DIFC - Prescibed Company

What is a Prescribed Company?

A DIFC Prescribed Company is a private company limited by shares that falls under the regime of a Small Private Company, as per the Companies Law. For companies already established as a Special Purpose Company (SPC) and Intermediate Special Purpose Vehicle (ISPV) will automatically become Prescribed Companies whilst certain other entities can be formed as a Prescribed Company.

Who can setup a Prescribed Company?

  1. An Authorised Firm;

  2. Fund;

  3. Family Office;

  4. Fintech Entity

  5. Foundation;

  6. Government Entity;

  7. Holding Company;

  8. Private Trust Company;

  9. Proprietary Investment Company; or

  10. Person wholly owned by one (1) or more of the foregoing Qualifying Applicants, and the DIFC

  11. DIFC Entities*

Authorised Firm is defined as ‘a person who holds a licence from the DFSA or a Recognised Financial Services Regulator to carry out one or more Financial Services, excluding a representative office.

*Any DIFC registered entity with the exception of retail entity and a prescribed company.

What are the qualifying purposes for a Prescribed Company?

  • Aviation Structure

  • Crowd Funding Structure

  • Structured Finance

  • DIFC Holding Structure – Entity established for the sole purpose of owning DIFC entity(s)

What are the Prescribed Company Regulations?

Using this link, you will be re- directed to the Prescribed Company’s Regulations issued by the DIFC: https://www.difc.ae/files/7015/7639/9818/Prescribed_Company_Regulations_2019.pdf

What are the advantages of a DIFC Prescribed Company?

Strategic structuring

Focus on objectives with a structure that encompasses decision making and accountability.

Protects intellectual property

Allows IP to be used as security against fund raising or for commercialisation purposes.

Ring-fence assets

Own assets to reduce the complexity of the ownership and sale process in large companies.

Financing and securitisation

Asset securitisation as a means to raise funds, finance purchase of assets by raising capital.

Risk mitigation

Isolate risk by holding assets or liabilities, particularly where the parent company may be exposed to volatile markets.

Tax efficiency

Free-of-tax structure on profits, gains and shareholder returns can improve tax efficiencies.

Succession planning

Ideal for family businesses, can be used to manage a specific business continuity plan and ring-fencing assets.