DIFC - Prescibed Company
A DIFC Prescribed Company is a private company limited by shares, classified under the “Small Private Company” regime as defined by the Companies Law. Entities previously established as a Special Purpose Company (SPC) or Intermediate Special Purpose Vehicle (ISPV) are automatically recognised as Prescribed Companies. Other eligible applicants may also incorporate a Prescribed Company subject to DIFC approval.
Prescribed Companies may only be established by the following qualifying applicants:
- Authorised Firms
- Funds
- Family Offices
- FinTech Entities
- Foundations
- Government Entities
- Holding Companies
- Private Trust Companies
- Proprietary Investment Companies
- Individuals or entities wholly owned by any of the above
- DIFC-registered entities (excluding retail entities and other Prescribed Companies)
Note: An Authorised Firm refers to a person or entity holding a licence from the DFSA or a Recognised Financial Services Regulator to carry out one or more Financial Services, excluding representative offices.
Prescribed Companies must operate for one or more of the following permitted purposes:
- Aviation structures
- Crowdfunding structures
- Structured finance
- DIFC Holding Structures – entities formed exclusively to hold DIFC-based businesses or entities
DIFC Prescribed Companies offer a strategic platform for a variety of business, investment, and family structuring objectives:
Strategic structuring
Tailored to focus on specific objectives with built-in governance, control, and accountability mechanisms.
Intellectual property protection
Hold and manage IP rights, which can be leveraged for capital raising or commercialization.
Asset ring-fencing
Isolate ownership of key assets, simplifying ownership, transfer, or disposal – particularly useful in larger organizations.
Financing and securitisation
Use assets as security to raise finance or capitalise purchases, including securitisation structures.
Risk mitigation
Separate specific assets or liabilities from the parent group to limit exposure to high-risk environments.
Tax efficiency
Benefit from DIFC’s tax-neutral regime on profits, gains, and distributions, allowing for enhanced tax planning.
A flexible vehicle for business continuity planning, including the orderly transfer and protection of assets within family enterprises.
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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?
An Authorised Firm;
Fund;
Family Office;
Fintech Entity
Foundation;
Government Entity;
Holding Company;
Private Trust Company;
Proprietary Investment Company; or
Person wholly owned by one (1) or more of the foregoing Qualifying Applicants, and the DIFC
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: Click here
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.
