UAE INHERITANCE PRINCIPLES – Overview
In every part of the world, there are laws that govern the citizens and defines what belongs to individuals per time. Inheritance principles for non-muslims in the United Arab Emirates are stipulated by the Islamic Sharia law (also known as Sharia) which establishes the fundamentals of inheritance and succession. Sharia is a religious form of law mainly; sourced from the Quran and the Sunnah (sayings of Prophet Muhammad PBUH) and regulates most aspects of the lives of Muslims, such as moral, family, personal status, charity, community life, and inheritance, among others.
Though Sharia, in essence, is not totally codified, in the UAE, provisions regarding inheritance principles for non-muslims in the United Arab Emirates – as well as personal status’ matters like marriage, divorce, capacity, and tutorship – are compiled in UAE Federal Law No. 28 of 2005 (also known as the Personal Affairs Law). Supplementary provisions may be found in UAE Federal Law No. 5 of 1985 (also known as the Civil Transactions Law of the Civil Code).
The Personal Affairs Law applies to all UAE citizens except non-Muslims. It also applies to all expatriate residents, regardless of their faith, unless they ask for the application of their national law. In line with the Personal Affairs Law, the Civil Code also provides that inheritance shall be governed by the law of the deceased, understood as the law of the deceased’s own country or the community at the time of death.
In any case, while dealing with inheritance principles for non-muslims in the United Arab Emirates, the Court of First Instance of the Family Division of the Dubai Courts would always consider UAE law principles, such as the mandatory compliance of the relevant foreign law with the country’s public order and morals.
Importance of The Wills
The application of foreign law by the UAE Courts is not automatic: evidence of the election of such foreign law will be obviously required. A will previously be executed and attested at the “Wills and Estates Registry for non-Muslims” at the Dubai Courts (Dubai Courts Registry), for instance, serves that purpose. This type of will may be governed by the law of the testator and may include any type of assets in spite of a provision of the Civil Code stating that the UAE law is applicable to real estate properties located in the country and disposed of by foreigners in their wills.
Eventually, the Dubai Courts treated freehold property as an exception to the rule, therefore, allowing the distribution of such properties pursuant to the deceased’s will. However, this scenario may change with the recent issuance of Dubai Law No. (15) of 2017 Concerning Administration of Non-Muslim Estates in Dubai and Execution of their Wills (Dubai Law), which was published in the Official Gazette in early November 2017. The Dubai Law apparently brought clarity to this issue stating that the law of the Emirate of Dubai applies to inheritance principles for non-muslims in the United Arab Emirates or wills that include real property.
In the absence of a will, the local Courts will likely apply the rules of Sharia. If the deceased left a will registered at the Dubai Courts Registry, at the probate stage the heirs will need to bring forward, in addition to the registered will, a copy of the relevant foreign legislation (legalized and translated to Arabic). If these or other requirements are not met, Sharia law shall probably be applied by default. In such a case, the interested parties may appeal to the Court of Appeal, and if the decision is still not favorable, the last resort is the Court of Cassation.
The DIFC Wills and Probate Registry
In addition to the Dubai Courts Registry option, a significant alternative is very popular in the UAE among non-Muslims expatriates: the DIFC Wills and Probate Registry (DIFC Registry).
The DIFC Registry is a wills’ registry for non-Muslims based inside the Dubai International Financial Centre (DIFC), a financial free zone with its own regulations and its own Courts and Dispute Resolution Authority, which are governed by common law as opposed to Sharia or Civil law. The DIFC Registry is a public entity of the Government of Dubai and was established under the jurisdiction of the DIFC Courts.
The validity of a DIFC Registry’s will is regulated by DIFC law thus ensuring testamentary freedom. It covers both movable and immovable assets (real estate, bank accounts, companies’ shares, etc.) owned by the testator at the time of his death and located in the Emirate of Dubai, and more recently, in the Emirate of Ras Al Khaimah. A property will, a free zone company will and financial assets will are also types of wills available to testators at the DIFC Registry subject to certain special conditions.
From a practical standpoint, it is worth noting that the DIFC Registry’s will is executed only in English and, in case of the death of the testator, it is enforced by DIFC Courts, hence eliminating the possibility of application of Sharia law in non-Muslim individual’s probates.
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