DIFC Companies Law, DIFC Law No. 5 of 2018 (consolidated March 2022)chapter by chapter

Companies Law Art 11(4), 14Formation

A Company not adopting Standard Articles must submit an Incorporators' statement ensuring compliance to the Registrar.

Companies Law Art 16, 17Articles

A Company must amend its Articles by Special Resolution and provide amendments and a compliance certificate to the Registrar before changes take effect.

Companies Law Art 19Filing

A Company must file copies of Special Resolutions or binding agreements with the Registrar within 30 days, facing fines for delays.

Companies Law Art 23Holding Company

Bodies corporate cannot be shareholders in their holding companies, with subsidiary restrictions on holding parent shares.

Companies Law Art 42Public offers

A private company cannot publicly offer securities or allot them with the intent to do so, with fines up to USD 30,000.

Companies Law Art 46, 50Transfers

Companies must register share transfers promptly upon written request and provide written reasons for transfer refusals within 14 days.

Companies Law Art 49Registers

A Company must rectify the register of Shareholders or debenture holders as ordered by the Registrar.

Companies Law Art 52Redemption

Shares may only be redeemed if fully paid and after all Directors certify the Company can pay its debts, with notification to the Registrar required.

Companies Law Art 53Share buy-back

A Public Company must obtain shareholder approval for share buy-backs and notify the Registrar within 30 days, facing fines for non-compliance.

Companies Law Art 55Financial assistance

A Public Company or Subsidiary cannot provide financial assistance for share acquisition unless specific exceptions are met, with fines for violations.

Companies Law Art 64Distributions

A Company can only distribute profits from accumulated realized profits and must maintain a net asset threshold; non-compliance incurs fines.

Companies Law Art 66Directors

A private company must have at least one director and a public company at least two, with specific eligibility criteria for directors.

Companies Law Art 79Director financial assistance

A Company may only provide a Director loan or assistance with 90% Shareholder approval and all Directors certifying no material prejudice.

Companies Law Art 81Secretary

A Public Company must appoint at least one Secretary with appropriate qualifications, with penalties for non-compliance.

Companies Law Art 82Registers

Companies must maintain a register of Directors and Secretaries at their registered office, accessible to certain parties for at least two hours daily, with fines up to USD 2,000.

Companies Law Art 84Disqualification

Individuals under a Court disqualification order cannot serve as Directors or manage a Company, facing fines up to USD 25,000.

Companies Law Art 96Minutes

A company must keep minutes of all meetings, which must be available at the registered office for Shareholders, providing copies within 7 days of request.

Companies Law Art 107Mergers

Companies must certify the grounds of a merger resolution with solvency statements before notifying the merger, incurring fines up to USD 25,000 for unfounded certifications.

Companies Law Art 114, 116Mergers

Merging companies, including a foreign company, must jointly apply to the Registrar with documentation and keep the Registrar updated on objections.

Companies Law Art 122Accounting records

Repeats: Companies must keep accounting records for six years, ensuring they are open to oversight and subject to fines for failure.

Companies Law Art 126Directors' report

Directors of a Public Company must prepare an annual report detailing activities and dividends, facing fines for non-compliance.

Companies Law Art 127Audit

Companies must appoint registered auditors, ensuring no conflicts of interest, with fines of up to USD 15,000 for unregistered auditing.

Companies Law Art 130Auditor resignation

An auditor must resign by notifying the registered office and the Company must inform the Registrar and shareholders within specified timeframes.

Companies Law Art 131Audit co-operation

A company and its officers must not provide false information to auditors, destroy documents, or coerce the auditor, with fines up to USD 5,000.

Companies Law Art 138Recognised Company

A Recognised Company is required to maintain Accounting Records for a minimum of 6 years, with significant penalties for non-compliance.

Companies Law Art 148Registrar directions

Companies must follow any directives issued by the Registrar under the Companies Law or Operating Law.

Companies Law Art 149Unfair prejudice

Court orders altering Articles must be delivered to the Registrar within 14 days, or longer if allowed by the Court.

Companies Law Art 150Strike off

Directors must maintain the company’s records for 6 years after the name is struck off the Public Register.

Companies Law Arts 24-25Class rights

Class rights can only be changed by a 75% majority consent or a Special Resolution, allowing dissenting holders to petition the Court within 30 days.

Companies Law Arts 27-30Company type

Private Companies are limited to 50 shareholders and cannot offer public securities, while Public Companies must comply with naming and reporting rules.

Companies Law Arts 31-32Re-registration

A Public Company may re-register as Private with shareholder approval, while a Private Company must provide financial statements to re-register as Public.

Companies Law Arts 35-36, 39Share capital

Public Companies must have at least $100,000 in share capital, with shares issued only at or above nominal value, and bearer shares are prohibited.

Companies Law Arts 37-38Allotment

A Private Company must allot Shares for cash unless the board appraises other consideration, while a Public Company requires an independent valuation filed with the allotment notice.

Companies Law Arts 40-41Pre-emption

Prior to allotting Equity Securities, Companies must offer them to existing holders on proportional terms, barring certain exceptions.

Companies Law Arts 44-48Registers

Companies must maintain a register of Shareholders at the registered office and allow for inspections, with fines for non-compliance.

Companies Law Arts 56-58Reduction of capital

A Private Company reduces capital through a Special Resolution with solvency statements, filing requirements, and public notice.

Companies Law Arts 73-77Director interests

A Director must declare any interest in proposed or existing transactions to fellow Directors, failing which may result in penalties.

Companies Law Arts 86-88Meetings

Public Companies must hold an Annual General Meeting within 6 months of the financial year end, with penalties for failure to do so.

Companies Law Arts 89, 92-94Meetings

A General Meeting necessitates 14 days' notice, including details of time, place, business, and resolutions.

Companies Law Arts 98-100Takeovers

An offeror with 90% of shares may issue squeeze-out notices within 120 days, inform minority shareholders, and must pay within six weeks.

Companies Law Arts 108, 110-113Mergers

Mergers must wait 28 days post-Special Resolution approval for creditor objections, with notices sent to creditors claiming over USD 5,000.

Companies Law Arts 117-118Compromise

Compromises with Creditors or Shareholders require majority approval and Court sanction, with certified orders delivered to the Registrar within 7 days.

Companies Law Arts 123-125Accounts

Directors must prepare and approve annual accounts within 6 months of year-end, file them with the Registrar within 30 days, and provide copies to Shareholders upon request.

Companies Law Arts 128-129Audit

Auditors must report to Shareholders on the accuracy of financial statements and have access to company records and meetings to conduct their audit.

Companies Law Arts 133, 136Recognised Company

A Foreign Company must register as a Recognised Company and appoint an Approved Person to operate in the DIFC, with penalties for non-compliance.

Companies Law Arts 140-142, 145Transfer of incorporation

A foreign company must apply with an affidavit and articles to continue in DIFC, while a DIFC company needs a special resolution to move out.

Companies Law Art 122, 138-retRecord Retention — Accounting Records

Companies must retain accounting records for at least six years from the date each record is created.

Companies Law Art 150(2)-retRecord Retention — Books and Records of a struck-off Company

Books and Records of a struck-off Company must be retained for 6 years from the date of striking off the Public Register.

Companies Law Art 53(6)-retRecord Retention — Contract for the purchase of own Shares (Public Company)

Public Companies must retain contracts for the purchase of their own shares for 10 years from the purchase date.

Companies Law Arts 140-144; Companies Regulations 8.1Transfer of incorporation into the DIFC

Foreign Companies wishing to incorporate in the DIFC must submit a formal application, including proof of solvency and required documents for approval.

Companies Law Arts 145-146; Companies Regulations 8.3.1-8.3.2Transfer of incorporation out of the DIFC: authorisation

A DIFC Company requires a Special Resolution and Registrar's authorization to transfer incorporation abroad, ensuring solvency and compliance with foreign law.