On 29th October 2017, Sheikh Mohammed Bin Rashid, Vice President and Prime Minister of UAE and Ruler of Dubai issued Law No. 14 of 2017 governing endowments, outlining the structure of charitable activities in the emirate and institutionalizing the regulation, management, protection and operation of endowments. A second Law No.17 of 2017 was also issued at the same time to formalize the role of the Mohammed Bin Rashid Global Centre for Endowment Consultancy, launched in early 2016.
Law No. 14 is in alignment with the country’s vision regarding charity and humanitarian efforts and details a comprehensive legal framework in order to preserve the significant history Endowments have had in the Arab world as community developing tools. It aims to promote Awqaf and endowments.
The law was drafted as a collaborative effort between the Mohammed Bin Rashid Global Centre for Endowment Consultancy, the Supreme Legislatives Committee and the AMAF. It authorities the Dubai Awqaf and Minors Affairs Foundation (AMAF) and the Mohammed Bin Rashid Global Centre for Endowment Consultancy (GCEC) to issue licenses for waqf establishment and also assigns them the responsibility of creating a governance system for the licensed endowment institutions, which includes the operational mechanisms of the institutions, management, obligations and penalties in the case of violations of terms of licensing. The law also authorizes the Mohammed Bin Rashid Global Centre for Endowment Consultancy to grant the Dubai Endowment Sign to institutions, companies or individuals that have contributed through sustainable waqf-related initiatives based on the concept of innovative endowment and as per standards approved by the MBRGCEC. The AMAF are responsible for overseeing and monitoring waqf establishments.
As per the law, the Dubai Endowment Sign recipients shall be granted preference in government procurement, hence incentivizing potential endowers as governmental agencies shall consider the Sign as an additional criterion when choosing contractors as long as other requirements have been met.
The new law entitles the MBRGCEC to provide consulting services for organizations and individuals in accordance with international best practices, identify sectors that waqf can support, enhance understanding of Awqaf and endowments by conducting research and studies, organizing conferences and workshops and signing strategic partnership agreements with specialize organizations. It also assigns the Board of Trustees of the MGBRCEC the responsibility of appointing a Secretary-General, making void any other piece of legislation that contradicts or challenges its articles.
The law defines the various endowments provisions including its creation, types and conditions. The law prescribes the conditions of an endowed party, the effects of an endowment and the party to which the property shall be endowed to. It also defines endowment custody including the appointment of a custodian for management of endowment, requirements of being a custodian and their respective rights and obligations. The law also sets out the procedures related to investing and replacing Waqf. The new law has been stressed to be instrumental for community development in its ability to address and provide for the local community needs and will create an incentivizing environment allowing for endowments to contribute to various social, scientific, cultural and environmental fields, as stated by Sheikh Mohammad. The new law promotes the ongoing benefits of endowments as financial assets for businessmen and the private sector, simultaneously stressing the core principle of endowments as sustainable community development measures. The law hopes to construct an environment wherein endowments and contributions to different fields such as education, culture, environments, sports and health are encouraged. It facilitates the Mohammed Bin Rashid Global Centre for Endowment Consultancy support for Dubai’s vision to become a global humanitarian hub, aiming to cater to the community needs at local, regional and international levels. As per Law No. 14, endowments are subject to Federal Law No.5 of 1985 without undermining the terms and conditions set forth by the grantor or otherwise by the AMAF and MBRGCEC. The law does not conflict with nor challenge the newly proposed trust law and foundation law, that the Dubai International Financial Centre, DIFC, has opened a public consultation program for in October. The law will be published in the Official Gazette and will be considered valid from the date of issuance.
The law will be published in the Official Gazette and will be considered valid from the date of issuance.
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