Month: November 2020

Inheritance Law in UAE for Expats

Inheritance Law in UAE for Expats | Hire Inheritance Lawyer in Dubai UAE

United Arab Emirates is a desirable country of dreams, for residence for many citizens of other countries, a country that is distinguished by hospitality to all nations in the world, a country that has managed to create an atmosphere of goodwill and mutual respect among different nationalities, a country that has managed to attract investors and workers from many countries around the world. Due to this, about 90% of the population of the UAE are expats, many of whom have been successfully living, working and having business in the Emirates for many years, while others have invested in the local real estate market in order to obtain a stable income from renting out real estate.

Sooner or later, expats are like to face the issue of inheriting property. It is good if the owners of various types of property have taken care of these issues in advance, and it is better to take care of this issue in advance, why, we will discuss in this article.

Despite the incredible progress of the Emirates in the implementation of Western institutions of law, the prevailing rules of law are Sharia laws, which underlie all the legislation of the UAE, which many expats forget or simply do not think about, feeling so comfortable in the UAE like in their home countries or even better.

Therefore, it is very important to understand the cultural and social differences that effects the legislation of the UAE.

The principal source of law of inheritance in UAE is Sharia and on this basis, Federal Laws bases. Main laws governing succession are Federal Law Number 5 of 1985 concerning the Civil Transactions Code and Federal Law Number 28 of 2005 regarding the Personal Status Law.

Article 1(2) of the Personal Law states that the law will be applicable on all the citizens of UAE unless a non-Muslim foreign national have special provisions according to their community, which empowers the foreigner to have a choice of the law and avoid application of Sharia. Simultaneously, Article 17 of the Civil Law states that the inheritance will be governed by the law of the testator at the time of his death.

The Personal Law in UAE permits the non-Muslim to draft a will and divide the property according to their will. However, if a foreign national dies without a will, the Civil Law and the Personal Law will allow the courts to distribute the assets of the deceased according to the principles of Sharia.

According to Article 17(1) of the Civil Law, the inheritance will be regulated by the law of the deceased during the time of his death, whereas, Article 17(5) of the Civil Law states that the UAE law will be applicable on non-Muslim expatriate wills regarding the property located in the country. In addition to this, Article 1(2) of the Personal Law states that the law will be applicable to non-Muslim unless he elects otherwise. Thus, if a non-Muslim foreign national die in the state are leaving the real property or other assets in the country, his home country law can be applicable, and his heirs can request the court accordingly. However, there is a restriction on dealing with the assets for property located in UAE.

On November 2020 President His Highness Sheikh Khalifa Bin Zayed Al Nahyan approved a number of Presidential Decrees amending the Personal Status Law, Federal Penal Code and the Federal Penal Procedural Law with immediate effect.

These amendments illustrate a shift from UAE based Sharia law towards a more secular system. Changes include the decriminalization of suicide, cohabitation of unmarried couples and reforms to the inheritance and divorce laws.

The innovations approved by the UAE President His Highness Sheikh Khalifa Bin Zayed Al Nahyan, were enthusiastically received by expats, as they create even more comfortable and familiar conditions for them to live, study and work in UAE. It was a positive and bold step by the Government of UAE.

Expatriates can now use the laws of their own country or nationality to deal with their personal estate and their assets would no longer be automatically divided under Islamic law. Previously, unless official legal measures were taken, the Sharia Law of Inheritance was applied to the estates of expats who passed away. This meant that assets were distributed according to Sharia law and even the custodianship of children was subject to the same laws.

Now, if a person dies in the UAE without a will in place, their estate will be divided as per the applicable law according to their citizenship – regardless of their religion.

The only exception here applies to the properties which are owned by the person within the UAE. These properties will be managed and divided according to UAE laws.

It is important to have a solid estate plan in place to ensure that your loved ones receive your assets. A will in the UAE is the simplest way for an expat to ensure their assets will be transferred as per their wishes.

Before the new changes to the inheritance law, if a person dies without a will, this can cause issues. Sharia law will be applied to any assets that are held in the UAE and this causes most complications in the event of a person’s death. Anyway, the assets will be frozen and will only be released upon the advice of the local courts. Any UAE bank accounts in the person`s name will also be frozen, even those in joint names, and vehicles in his name will be impounded. This happens very quickly and you should be prepared to it in advance. All women should have access to a bank account in their sole name, either here or in their home country, so as not to be left without a livelihood.

At this moment, the law enforcement practice of new changes in laws is in the stage of formation and it would be reasonable to consider how a non-Muslim can draw up a will before the adoption of new laws.

In the UAE, non-Muslims can draw up and register wills for their UAE assets that follow common law. In Dubai, wills can be notarized and registered in the Dubai Courts or at the DIFC Wills Service Centre and the Non-Muslim Wills & Probates Office at the Abu Dhabi Judicial Department. Will registered with the Dubai Courts apply to all Emirates, the will registered with the DIFC Wills Service Centre apply only to Dubai and Ras Al Khaim. However, in reality sometimes happens, that validity of the wills notarized and registered in the Dubai Courts decides by the court during probate.

Eligible individuals have the option to register different types of wills at the DIFC Courts Wills Registry for non-Muslims depending on the assets they wish to cover and whether or not the will is to encompass guardianship arrangements. There are currently five types of ‘DIFC Courts Will’ that can be registered, referred to as the ‘Guardianship Will’, ‘Property Will’, ‘Business Owners Will’, the ‘Financial Assets Will’ and the ‘Full Will’.

To register a DIFC Courts Will you must satisfy listed criteria:

  • You are not a Muslim, and have never been a Muslim.
  • You are over 21 years of age.
  • You own assets within the UAE.
  • Any children for which you wish to appoint guardians for must be habitually resident in the UAE.

Many expats may wonder, do I need a lawyer to prepare a will, and that is the right question. Given the diversity of assets that may be owned by a person who wishes to draw up a will, real estate, an operating business, financial liabilities, intangible assets, bank accounts, etc., we recommend to have a consultation with a lawyer before drawing up the will in order to avoid mistakes that will become irreparable in the future.

 

Compensation for Occupational Injury

Employees Compensation for Occupational Injury | Injury Lawyer in Dubai UAE

Federal Law No. 8 of 1980, UAE Labor law outlines employee’s right of compensation if they suffer injury at work. Under this law, employers are liable for workplace injuries sustained by employees.

Workplace injuries are defined broadly to include any accident sustained by the employee during their work or as a result of performing their work.

In addition to employees’ rights under the Federal Law No. 8 of 1980, employees can also bring claim against the employer under Federal Law No. 5 of 1987 (UAE Civil Code). However, under the Civil Code, the employee must prove the fault or negligence on the part of the employer in order to claim successfully.

UAE law guarantees safety of employee during work and therefore impose upon employers to ensure safety working environment to its employees. Employers are mandated by law to provide and have suitable health and safety guidelines in place, including policies and proper incident report protocol in order to promptly address and comply with the mandate of the Labor Law.

Below is the summary of the procedure and corresponding guarantees provided under the Labor law:

  1. In the event of injury sustained during employment, report must be immediately made by employees to the police and Labor Department or local office who has jurisdiction in the area where the injury took place. Investigation will be carried out thereafter.
  2. Copy of Investigation report will be sent by the police to the Labor Department and another to the employer.
  3. In cases of labor accidents, the employer shall be liable to pay for the treatment of the employee which includes hospitalization, medical test and medicines prescribed including rehabilitation.
  4. If the injury resulted and prevented the employee from performing his work, the employer shall pay him an allowance equivalent to full wage during the entire period of treatment or for a period of six month, whichever is shorter. If the medication requires more that six months or until the employee fully recovers, the allowance shall be reduced by half until the employee fully recovers, declared disabled or dies, whichever occurs first.

+ Article (147)

  1. Any dispute arises in regard to employee’s fitness for work or degree of disability shall be govern and shall be referred to the Ministry of Health through competent Labor Department. Medical Board will be formed to determine the matter related to the injury or treatment. Assistance of the expert may be sought, and the decision of the Committee shall be final and will submitted to the Labor Department for execution.
  2. In the event the occupational injury resulted to death of the employee, the person who at the time of death of the employee used to be entirely or mainly supported by the income of the descend shall be entitled to compensation equal to basic wage of the employee for 24 months, provided that the amount of compensation is not less than AED 18,000 or more than AED 35,000. Calculated as per the guidelines set forth under the Labor Law.
  3. Should the injury results to partial disability or permanent disability of the employee, compensation shall be calculated set forth under the Labor Law.

In summary, determination of the issues relating to the occupational injury shall be determined in accordance with the level or type of injury and the proportion of disability sustained by the employee.

Cryptocurrency Law in UAE

Cryptocurrency Law in UAE | UAE Blockchain Laws and Regulations

In the field of financial and capital markets, the United Arab Emirates Central Bank and the Securities and Commodities Authority (SCA) are the federal regulators.

The legal regulations that we should bear in mind in the United Arab Emirates is the different regulatory positions that are being adopted by the UAE federal regulators the Central Bank, SCA and free zone regulators the Dubai Financial Services Authority (DFSA) and the Financial Services Regulatory Authority (FSRA). With the use of virtual coins and tokens becoming more popular in the Middle East, and the aspiration of the UAE to be at the forefront of new business regulations, the UAE will seek to carve a dominant space in the field of blockchain and DLT and for that purpose adopt pro-business regulatory measures. By introducing its virtual asset framework early, the Abu Dhabi Global Market (ADGM) has garnered wide international attention and attracted several centralized crypto exchanges to operate out of the ADGM.

Regulation of cryptocurrency and blockchain projects in UAE is performed by the FSRA regarding ADGM. This authority publishes guidance on cryptocurrencies. It also monitors blockchain businesses to ensure transparency as well as prevent money laundering and financing terrorism. Other authorities that might contribute to crypto regulations in UAE in the future are the SCA and the DFSA.

The DFSA is the independent regulator of financial services conducted in or from the DIFC, a purpose-built financial free zone in Dubai, UAE.

The DFSA’s regulatory mandate includes asset management, banking and credit services, securities, collective investment funds, custody and trust services, commodities futures trading, Islamic finance, insurance, an international equities exchange, and an international commodities derivatives exchange. In addition to regulating financial and ancillary services, the DFSA is responsible for supervising and enforcing anti-money laundering (AML) and counter-terrorist financing (CTF) requirements applicable in the DIFC.

The Dubai Multi Commodities Centre Free Zone (DMCC) is a place worth considering for working with cryptocurrencies in UAE. The DMCC crypto license will guarantee the legality of your business.

The first company to receive this license was Regal Assets, which offered cold storage of cryptocurrencies for its customers. In February 2018 Regal RA DMCC, subsidiary of Regal Assets Inc., an internationally renowned gold investment company, and the Middle East’s first company to have been issued a Crypto trading license, launched today a “deep cold storage” solution for investors and traders. For the first time, crypto-commodities owners can now store their Bitcoin, Ethereum and other altcoins in a vault located in Almas Tower, Dubai – the headquarters of DMCC, the world’s most interconnected Free Zone, and the leading trade and enterprise hub for commodities.

However, according to the Library of Congress “Under article D. 7.3 of the Regulatory Framework for Stored Values and an Electronic Payment System, issued by the Central Bank of the UAE in January 2017, all transactions in “virtual currencies” (encompassing cryptocurrencies in Arabic) are prohibited.” and companies only allowed to trade on their own behalf.

As of today, there is no crypto law in UAE. «Regulation of Crypto Asset Activities in ADGM» by the FSRA is the most detailed guide of cryptocurrencies in United Arab Emirates. According to it, there are regulatory requirements for operating crypto asset business including allowed crypto assets, holding equivalent capital resources, KYC and others.

With this The SCA aims to complete the legislative infrastructure for the crypto assets in relation to financial markets and instruments, in addition to commodities from one side as well as the licensing of financial activities related to crypto assets especially when it comes to exchanges, and crowd funding platforms while ensuring security, encouraging innovations and competition in the alternative finance sector. The SCA will endeavor to ensure the protection of investors dealing in crypto assets, and ensure there is no money laundering activities or financing of terrorism.

The market has been waiting for the final regulations concerning crypto assets in the UAE. The SCA had announced the draft crypto asset regulation in October of 2019, a year later it seems, that the law will be approved. This will create a huge boost when it comes to crypto trading, crypto assets as an alternative investment tool, and the implementation of digital currencies in general.

In October 2020 the UAE SCA during its recent Board of Directors virtual meeting headed by H.E.  Abdulla Bin Touq, Minister of Economy and President of Board of Director, has approved the crypto assets legislation. The law will be published soon on UAE SCA’s website.

In April 2018, the UAE Government launched the Emirates Blockchain Strategy 2021. The UAE will use blockchain for digital transactions, giving each customer a unique identification number that points to their information on the secure chain. Information and data on the blockchain cannot be hacked or changed, which will ensure the digital security of national documents and transactions and eventually reduce operational cost and accelerate decision-making, which will affect the vision, rules and regulations of crypto currency, including cryptocurrency.