Islamic Finance

Dubai issues new laws regulating awqaf and endowments

Photo: Prime Minister and Vice-President of the United Arab Emirates and ruler of Dubai Sheikh Mohammedbin Rashid al-Maktoum attends the 28th Ordinary Summit of the Arab League at the Dead Sea, Jordan March 29, 2017. REUTERS/Mohammad Hamed

Dubai has issued two new laws regulating awqaf and endowments to establish a modern legal framework for a sector that has traditionally played a role in development at the Arab and global level, reported United Arab Emirates state news agency WAM.

Law No. 14 of 2017 specifies the responsibilities and obligations of concerned entities and prescribes the regulations and procedures that govern the management and development of awqaf and endowments, according to WAM.

It will institutionalise the management, operations and protection of endowments and outlines the structure for an environment for charitable activities and community contributions in the fields of education, healthcare, culture, arts, environment, sports and social unity. 

The second law, No. 17 of 2017, was issued at the same time to define the role of the Mohammed bin Rashid Global Centre for Endowment Consultancy (MBRGCEC) that was launched in March 2016

Law No. 14 also regulates the MBRGCEC Dubai Endowment Sign awarded to government institutions and private companies. To obtain the sign, the institution, company or individual must have launched sustainable waqf-related initiatives, projects or contributions. The sign is awarded according to the standards approved by the MBRGCEC.

Law No. 14 also authorises Dubai’s Awqaf and Minors Affairs Foundation (AMAF) to issue licenses for waqf establishments in collaboration with the MBRGCEC.

AMAF, in collaboration with the MBRGCEC, outlines the regulations that govern waqf establishments, including licensing, governance regime and penalties for licensing violations. It is also responsible for overseeing and monitoring the waqf establishment.

Under Law No. 14 of 2017, endowments are subject to Federal Law No. 5 of 1985 without prejudice to the terms and conditions set forth by the grantor or otherwise by the AMAF and the MBRGCEC.

The Board of Dubai’s AMAF, in collaboration with the MBRGCEC, is authorised to issue the policies and procedures required to implement this law.

The law does not contradict or challenge the waqf-related laws applicable in the financial free zone, the Dubai International Financial Centre (DIFC), which opened a public consultation process for its proposed trust law and foundation law on October 10. 

Law No. 17 of 2017 authorises the MBRGCEC to provide consulting services for individuals and organisations according to international best practices, identify the critical development requirements that waqf can support, enhance knowledge and capabilities in the fields of awqaf and endowments by conducting research and studies, organise conferences and workshops and signing partnership agreements with specialised local, regional and international organisations. The centre is also authorised to issue the MBRGCEC’s Dubai Endowment Sign according to specified regulations and procedures.

The law also authorises the Board of Trustees of the Mohammed bin Rashid Al Maktoum Global Initiatives to appoint the Secretary-General of the MBRGCEC. It annuls any other legislation that contradicts or challenges its articles.

Established in October 2015, Mohammed bin Rashid Al Maktoum Global Initiatives is a foundation whose vision is to improve the Arab world through humanitarian, developmental and community work. 

Both laws will be published in the UAE Official Gazette and considered valid from the date of issuance, which was on October 29. 

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