Law No. (9) of 2004
In respect of
The Dubai International Financial Centre
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We, Maktoum Bin Rashid
Al Maktoum, Ruler of Dubai,
After having reviewed:
The Constitution
and its amendments; and
Federal Law
No. 8 for the year 2004 concerning Financial Free Zones; and
Federal Decree
No. 35 for the year 2004 concerning the Establishment of a Financial Free Zone
in the Emirate of Dubai; and
Law No. 3 for the year
2002 establishing the Dubai International Financial Centre;
Do hereby enact the
following Law:
Article (1)
This Law will be cited
as " The Law of the Dubai International Financial Centre, No. (9) for
the year 2004":
Definitions
Article (2)
The following words
and expressions shall have the respective meaning assigned to each of them,
unless the context otherwise requires:
The Ruler: H.H.
Ruler of the Emirate of Dubai.
The State: The
United Arab Emirates.
The Emirate: The
Emirate of Dubai.
The
Government: The Government of
the Emirate of Dubai.
The Centre: Dubai International Financial Centre.
The Financial
Services Authority: Dubai Financial Services Authority.
The Centre's
Courts: Dubai International
Financial Centre Courts.
The President:
The
President of the Centre.
Centre
Authority: Dubai International
Financial Centre Authority.
Centre's
Bodies: Those bodies
established pursuant to subparagraph 3 of Article 3 of this Law and any other
bodies created by those bodies or by the President.
Services,
Goods and Products: Any services, goods
or products including, without limitation, materials, equipment and goods of
whatever kind, whether tangible or intangible.
Licensed
Centre Establishments: Any
entity licensed, registered or otherwise authorised to carry on financial and
banking business including those activities and businesses referred to in
Article 9 of this Law.
Centre's Laws: Any laws issued by the Ruler relating to the
Centre.
Centre's
Regulations: Any rules, regulations, bylaws, or orders relating to the Centre
issued by the President or the Centre's Bodies.
Centre
Establishments: Any entity or business
duly established or carrying on activity in the Centre, including any Licensed
Centre Establishments.
The Centre
Article (3)
(1)
The financial free
zone established in the Emirate known as the "Dubai International
Financial Centre" – abbreviated as DIFC – shall have financial and
administrative independence, and shall be attached to the Government.
(2)
The Centre shall have
a President who shall be appointed by a decree issued by the Ruler.
(3)
The following bodies are established within
the Centre:
(a)
the Dubai
International Financial Centre Authority, to be known as "DIFCA";
(b)
the Dubai Financial Services Authority, to be known
as the DFSA; and
(c)
The Dubai international Financial Centre
Judicial Authority.
(4)
The Dubai
International Financial Centre Authority shall be the legal representative of
the Centre, and may sue or be sued in the capacity.
Objectives of the
Centre
Article (4)
The Centre
shall have, without limitation, the following objectives:
(1) To be a
financial centre in the Emirate, based on principles of efficiency,
transparency and integrity with a view to making an effective contribution to
the international financial services industry;
(2) To promote the
position of the Emirate as a leading international financial centre; and
(3)
To develop the economy of the Emirate.
The President
Article( 5)
(1)
In addition to any
other powers and functions described in this Law, the President shall have the
following powers, duties and functions:
(a) To approve the
goals, strategies and policies of the Centre;
(b) To create
registries, including registries of real estate, security and companies;
(c) To submit
proposed Centre's Laws to the Ruler for enactment;
(d) To issue
Centre's Regulations;
(e) To appoint,
dismiss and replace members of the Board of Directors of the Centre Authority
and to determine their duties, membership period and remuneration.
(f) To appoint,
dismiss and replace members of the Board of Directors of the Financial Services
Authority and to determine their duties, membership period and remuneration in
accordance with the Centre's Laws and Regulations;
(g) To create any
other administrations, councils or entities, to achieve the objectives of the
Centre and to determine the form, powers, functions and members of any of them,
and dissolve or reconstitute any of them in the form that the objectives of the
Centre requires; and
(h) To issue and
Order for the appointment of the members of the Advisory Board, on the
recommendation of both the Centre's Board of Directors and the Financial
Services Authority Board of Directors.
(i) To do anything
the President deems necessary or desirable in the interest of good governance
of the Centre.
(2)
The President may
delegate all or part of his powers and functions prescribed in Article 5 (1)
(a)(b)(c)(d)(e)(g)(h) and (i) and in any of the Centre's Laws to any of the
Centre's Bodies or any other person or body.
The Centre Authority
Article (6)
(1) The Centre
Authority is hereby established and shall be supervised by its Board of
Directors.
(2) The Centre
Authority shall carry out its functions without interference from any of the
other Centre's Bodies and reports, and is responsible to the President.
(3) The Centre
Authority shall have an independent budget and the Government shall provide
sufficient funds for this purpose.
(4) For the
purpose of attaining its objectives, and in addition to any other powers and
functions described in this Law, the Centre Authority shall have the following
powers, and functions:
(a) To propose to the President all
strategy and policies for the Centre, other than policies relating to the
regulation of financial services and related activities;
(b) To
report to the President on the implementation of the approved strategy and
policies of the Centre;
(c) To impose administrative penalties, as
provided for by the Centre's Laws and the Centre's Regulations;
(d) To review and submit to the President
any proposed Centre's Laws drafted by the Centre Authority Legislature;
(e) To agree with the Financial Services
Authority on a consultation process on Centre's Laws, which the Centre
Authority intends to propose to the President for enactment by the Ruler;
(f) To provide for public comment on
Centre's Laws, which the Centre Authority intends to propose to the President
for enactment by the Ruler prior to proposing such Centre's Laws to the
President.
(g) To review and issue any proposed
Centre's Regulations which may be drafted by the Centre Authority Legislature;
(h) To
establish other ancillary bodies and institutions.
(i) To
possess, own, sell and lease lands and any other immovable and moveable
properties, including financial instruments and to develop such projects that
are necessary to achieve the Centre's objectives, in accordance with the
Centre's Laws and the Centre's Regulations.
(j) To
set the rules of operating the Centre Authority's bank accounts to obtain loans
and financial facilities necessary for the operations of the Centre Authority,
and to provide the assets, benefits and dues of the Centre as a security for
the same;
(k) To
establish representative offices within the State and abroad, to promote the
objectives and operations of the Centre Authority;
(l)
To keep confidential any
confidential information obtained, disclosed or collected by the Centre
Authority, in the course of performing its functions. Such confidential information may not be
disclosed to third parties except in circumstances permitted by the Centre's
Laws and the Centre's Regulations; and
(m) To
do any other work or perform any other function that the President deems
necessary to attain the objective of the Centre.
(5) The Centre Authority shall have the right
to delegate all or part of its powers and functions prescribed by this Law to
any person or body.
(6) The Centre Authority shall have an Executive. The DIFCA Executive shall be supervised and
managed by a Director General, who will be a de facto member of the Centre's
Board of Directors and who will implement the strategies and policies of the
Centre Authority including:
(a) To
develop the Centre strategy and policies other than policies relating to the
regulation of financial services and related activities.
(b) To review the financial statements of
the Authority and to prepare and to revise its annual budget;
(c) To prepare and implement the Human
Resources Policy of the Authority.
(d) To provide the infrastructure,
premises, administrative services (including municipal, security,
transportation services and information communication technology infrastructure
and services) and any other services necessary for achieving the objectives of
the Centre;
(e) To impose administrative penalties as
provided for by the Centre's Laws and the Centre's Regulations;
(f) To develop relations with other free
zones and all governmental, quasi-governmental authorities, institutions,
entities and individuals inside and outside the Emirate, for the purpose of
achieving the objectives of the Centre and organising its operations and
conclude and execute all kinds of agreements, contracts, and memoranda of understanding,
other than those related to the regulation of financial services and related
activities, and any matter over which any other of the Centre's Bodies have
exclusive jurisdiction, as provided by the Centre's Laws;
(g) To incorporate and register companies
in the Centre in accordance with the Centre's Laws and Centre's Regulations;
(h) To assist and facilitate the Centre
Establishments in providing their workforce;
(i) To provide all kinds of services to
the Centre Establishments and others who are related to the Centre;
(j)To impose and collect any fees or user
charges that the Centre Authority requires for services provided by the Centre
Authority; and
(k) To open and operate the Centre
Authority's bank accounts.
(7) The Centre Authority shall have a
legislature, which shall be responsible for drafting the Centre's Laws and the
Centre's Regulations other than those relating to the regulation of financial
services and related activities or any matter over which any of the Centre's
Bodies have exclusive jurisdiction, as provided by the Centre's Laws.
(8) The Advisory Board:
(a) An Advisory Board shall be established
by the Authority to provide advice to the Centre on the strategy for achieving
its objectives.
(b) The Advisory Board shall be appointed
based on the recommendation of both the Centre Authority and the Financial
Services Authority and shall be comprised of persons with international
experience relative to the operation of the Centre.
The Dubai Financial
Services Authority
Article (7)
(1)
A body known as the
Dubai Financial Services Authority (DFSA) is hereby established. It shall have
a separate legal identity and may sue and be sued in such capacity.
(2)
The Financial Services
Authority is the body solely responsible for the regulation of financial
services and related activities in the Centre.
(3)
The Financial Services
Authority shall carry out its functions without interference from any of the
other Centre's Bodies, and is accountable only to the President.
(4)
The Government shall
provide for the Financial Services Authority, independent from any Centre's
Bodies' control, necessary funds to discharge its powers and perform its
functions.
(5)
The Financial services
Authority shall be supervised by a Board of Directors and managed by an
executive. The members of the Board of
Directors shall be appointed for fixed terms and may be only be dismissed for
cause in accordance with the Centre's Laws and Regulations.
(6)
The Board of Directors
shall have exclusive authority to appoint, remove and determine the structure,
duties and service conditions of the Financial Services Authority executive.
(7)
The Board of Directors
shall have the authority to determine the infrastructure, premises,
administrative services and any other services necessary for achieving the objectives
of the Financial Services Authority.
(8)
The Financial Services
Authority shall have the following powers and functions:
(a)
To propose to the
President the Centre's Laws related to the regulation of financial services and
related activities and any matter over which the Financial Services Authority
has jurisdiction under the Centre's Laws. The Financial Services Authority's
policies shall be consistent with those laws;
(b)
To make policies
relating to the regulation of financial services and related activities;
(c)
To agree with the
Centre Authority on a consultation process on the Centre's Laws which the
Financial Services Authority intends to propose to the President for enactment
by the Ruler;
(d)
To provide for public
comment on any Centre's Laws the Financial Services Authority intends to
propose to the President for enactment by the Ruler, prior to proposing such
Centre's Laws to the President;
(e)
To issue Centre's
Regulations related to the regulation of financial services and related
activities and any matter over which the Financial Services Authority has
jurisdiction under the Centre's Laws;
(f)
To carry out, solely
and in an independent manner, the licensing, registration and supervision of
Licensed Centre Establishments and such other matters as provided by the Centre's
Laws and the Centre's Regulations;
(g)
To issue any rules or
regulations necessary to perform its functions;
(h)
To keep confidential
any confidential information obtained, disclosed or collected by the Financial
Services Authority, in the course of performing its functions. Such
confidential information may not be disclosed to third parties except in
circumstances permitted by the Centre's Laws and the Centre's Regulations.
(i)
To develop relations
with other governmental, quasi-governmental authorities, institutions, entities
and individuals inside and outside the Emirate for the purpose of achieving its
objectives and conclude and execute all kinds of agreements, contracts, and
memoranda of understanding related to the regulation of financial services and
related activities, and any matter over which the Financial Services Authority
has jurisdiction, as provided by the Centre's Laws;
(j)
To establish such
other ancillary bodies, as are necessary for discharging its functions, and may
delegate any of its powers to such ancillary bodies, to discharge its
functions;
(k)
To impose and collect
fees for services provided by the Financial Services Authority or as provided
for by the Centre's Laws and the Centre's Regulations;
(l)
To impose
administrative penalties as provided for by the Centre's Laws and the Centre's
Regulations;
(m)
To open and operate
bank accounts, to obtain loans and financial facilities necessary for the
operations of the Financial Services
Authority, and provide the assets, benefits and dues of the Financial Services
Authority as a security for the same;
(n)
To enter into
contracts and other agreements; acquire, hold and dispose of moveable property,
all as necessary to perform its functions; and
(o)
To appoint and
employee natural and corporate persons on terms it deems necessary to assist it
in exercising its powers and performing its functions.
The DIFC Judicial
Authority
Article (8)
(1)
The DIFC Courts shall
be formed and shall carry out their functions in an independent manner, in
accordance with the provisions of this Law, the other Centre's Laws and the
Centre's Regulations.
(2)
Unless otherwise
provided by any other Centre's Laws, the Centre's Courts shall have exclusive
jurisdiction to hear and determine any claims in which the Centre, the Centre
Establishments or any of the Centre's Bodies is party to and also to hear and
determine any dispute, arising out of any transaction carried out in the Centre
or an incident which took place therein. The President may also establish such
juristic committees and arbitration panels as are necessary.
(3)
The courts of the
Emirate shall entertain the prosecution of any crimes that take place within
the Centre.
(4)
The Centre's Courts
shall have exclusive competence to interpret this law, the Centre's Laws and
the Centre's Regulations.
(5)
The Government shall
provide the Centre's Courts with sufficient funds necessary to discharge their
powers and perform their functions.
(6)
The Centre's Courts
may appoint and employ persons on terms they deem necessary to exercise their
powers and perform their functions.
Licensed Centre
Establishments
Article (9)
Licensed
Centre Establishments may carry on financial and banking businesses, including
Islamic financing and business, and other activities, as permitted by their
licenses or registration, including the following:
(1)
Financial and banking
services including the business of investment and commercial banks, financing
companies, wholesale trading and electronic banking.
(2)
Insurance,
re-insurance and insurance brokerage services including property and casualty
insurance and other kinds of insurance and any other related services.
(3)
The trading of, and
advising on, securities, commodities and derivatives, and other related
financial services.
(4)
Money management
services, investment services and investment fund services for the purpose of
financing projects and providing capital for companies and establishments in
all fields of investment.
(5)
Pension funds,
investment funds and trust services.
(6)
Brokerage, clearing,
settlement and custody services.
(7)
Investment services
for all business and activities carried on in the Centre.
(8)
Legal, auditing and
accounting, and any other services ancillary to financial and banking
businesses and activities.
(9)
Supporting, and
assisting works and services and classification services and all forms of
information services for financial and banking businesses and activities.
Centre Establishments
Article (10)
Centre Establishments
shall carry out their activities in accordance with the Centre's Laws, Centre's
Regulations and the licenses issued to them.
Centre Establishments may be located in the Emirate outside the Centre
for a period not exceeding four years from the date of the establishment of the
Centre and in accordance with the conditions and restrictions determined by the
Centre Authority and, in the case of Licensed Centre Establishments, the
Financial Services Authority. For the
purposes of this Article, practicing such activities and business outside the
Centre shall be deemed as if conducted within the Centre, and shall be subject
to Centre's Laws and the Centre's Regulations.
Centre Activities
Article (11)
Subject to the terms
of Article 12 of this Law, the Centre's Laws and the Centre's Regulations, the
Centre Authority may provide and deal in all kinds of services, products and goods
from all sources whether local or foreign.
Prohibited Services and Goods
Article (12)
The Centre Authority
shall prepare a list of services, products and goods prohibited in the Centre
that may include, without limitation, the following:
(1) Services,
products and goods contradictory to the Centre's Laws and the Centre's
Regulations.
(2) Services,
products and goods that are prohibited by the laws applicable in the Emirate.
(3) Products
and goods carrying inscriptions, drawings, trademarks or signs considered to
contradict religious teachings and beliefs or public morals.
(4) Any service or
activity resulting in illegal competition.
Applicable and
excluded laws
Article (13)
(1)
The Centre's Bodies
and the Centre Establishments shall carry on business in accordance with the
Centre's Laws and the Centre's Regulations.
(2)
The Centre's Bodies
and the Centre Establishments and their employees ( for the purpose of the
transactions carried out within the Centre and related thereto) shall not be
subject to the rules or regulations of the Dubai Municipality, the Department
of Economic Development, the Department of Tourism and Commercial Marketing,
the rent committee or the authorities of any of those departments.
Tax Relief
Article (14)
The Centre's Bodies
and Centre Establishments and their employees shall be subject to a zero rate
of tax for 50 (fifty) years from the date of enactment of this Law, including
the income tax relating to their operations inside the Centre. The zero rate of
tax will also extend to transfers of assets or profits or salaries in any kind
of currency to any party outside the Centre for 50 (fifty) years from the date
of enactment of this Law. It is
permitted to renew this period for a similar period upon issuance of a resolution
by the Ruler.
Further Relief
Article (15)
(1)
Moneys and activities
of the Centre's Bodies and Centre Establishments shall not be subject to any
nationalisation procedures or any restrictions in regard to their personal
ownership.
(2)
All companies incorporated
with the Centre may be fully owned by persons or entities which are not
nationals of domiciled in the State.
The Centre's Employees
Article (16)
The Centre's
Bodies and Centre Establishments may employee or use any person provided that
they shall not be nationals of countries boycotted by the state.
Liabilities
Article (17)
The Government
and the President shall not be liable for any obligations arising out of the
operation of the Centre or the exercise by them of any power, duty or function
under this Law or the Centre's Laws and the Centre's Regulations.
Customs duties
Article (18)
The Centre
Bodies and Centre Establishments shall be exempt from custom duties on all
products and goods imported by them for the purpose of their works in the
Centre unless such goods are imported for trade.
Concluding Provisions
Article (19)
As from the
date of enactment of this Law the Centre Authority shall acquire and assume all
the assets and rights of the Dubai International Financial Centre Authority
established under Law No. (3) of 2002 , and the Centre Authority shall assume
all the liabilities of the Dubai International Finance Centre Authority
referred to above.
Article (20)
Any text in
any other Law to the extent that it contradicts this Law shall be repealed.
Article (21)
This Law shall
replace Law No. (3) of 2002 establishing the Dubai International Financial
Centre.
Article (22)
This Law shall
come into effect upon signature, and shall be published in the Official
Gazette.
Maktoum Bin
Rashid Al Maktoum
Ruler of Dubai
Issued in Dubai on 13th
of September 2004
Corresponding to 28th
of Rajab 1425