GCC Family Office Rules, Sharia Succession and Islamic Funds

GCC family office, fund and succession decisions: why architecture comes first

A Gulf founder holds the family companies in his own name and dies without a tested plan. Under Faraid, the fixed shares of Islamic inheritance, his shares pass to a dozen heirs in set proportions, and the GCC family office meant to hold the group together owns nothing. A European fund manager with a strong track record tours Dubai and Riyadh; the private banks decline, politely, because the fund is not Sharia-compliant. Both scenarios are composites, and both share one root cause: the architecture was decided too late.

This guide is for UHNW (ultra-high-net-worth) Gulf families and the fund managers who want their capital. The GCC is not one market. It is a patchwork of onshore regulators and common-law financial free zones, each with its own rulebook. Three questions decide almost everything, in this order:

1. Whose money is being managed? This decides licensing.
2. What happens to control when the founder dies? For Muslim families, Sharia forced heirship decides the structure.
3. Will the office or the product present itself as Sharia-compliant? This decides product design, governance and distribution.

Most families and fund managers ask these in the wrong order, or treat Sharia compliance as a marketing label. The ones that succeed build it into the architecture from day one. We take each question in turn, with every threshold and rule dated as of October 2026.

What

Does a family office in the GCC need a licence?

Usually not, if it manages only one family’s own wealth. A single-family office in the DIFC, ADGM or QFC is registered rather than licensed by the financial regulator, and Bahrain exempts it. It needs a financial licence once it serves unrelated families by way of business or manages outside investors’ money, as a multi-family office or fund manager does.

Every GCC regime draws the same line in different words, with three categories around it.

A single-family office manages one family’s own wealth. It runs the family’s investments, entities, reporting, staff and administration, and has no outside clients. In the financial free zones it registers with the companies authority (the DIFC Registrar of Companies, the ADGM Registration Authority or the QFC Company Registration Office), not the financial regulator, because it provides no financial service to anyone else.

A multi-family office serves several unrelated families by way of business. Advising other families, arranging deals for them or managing their money is regulated in every GCC jurisdiction. The office needs authorisation from the DFSA, the FSRA, the QFCRA, the CBB or the relevant onshore regulator, with the governance, compliance, anti-money-laundering systems and capital that come with it.

A fund pools money from outside investors. The fund is registered or notified, the manager is licensed, and every offer follows marketing rules that differ by investor type and country.

The line that matters is third-party money. An office that manages money for unrelated families, takes in external co-investors or runs a vehicle with outside limited partners has crossed into regulated territory, whatever it calls itself. A friend’s family joining a co-investment is a licensing question first.

Who

GCC regulators and Islamic finance terms: a reference

The GCC’s institutions carry similar names and different powers: since January 2026, the UAE and Saudi Arabia each have a Capital Market Authority. This reference gives each body and term one line, by country, then the Islamic finance bodies and the Arabic terms used in this guide.

Where

Family office rules by jurisdiction in the GCC, as of October 2026

Setting up a family office in the UAE usually starts and stops at one question: DIFC or ADGM. The wider GCC offers eight answers. Three financial free zones (the DIFC, ADGM and the QFC) and Bahrain run written family-office regimes. Saudi Arabia, Oman, Kuwait and onshore UAE regulate the activity, not the family office. Thresholds and fees move; who needs a licence does not.

“No dedicated regime found” means we found no family-office-specific rules on the regulator’s site or in legal commentary as of October 2026; the general licensing rules still apply.

DIFC family office requirements

The DIFC Family Arrangements Regulations 2023, in force since 31 January 2023, govern DIFC family offices. They replaced the 2011 Single Family Office Regulations and ended DFSA registration of such offices as designated non-financial businesses or professions.

The test is wealth: at least USD 50 million in aggregate family net assets, as of October 2026. The test counts the family’s total net assets, including operating businesses and real estate, not the assets the office manages. The family confirms it each year at renewal, so it is a standing condition, not a one-off entry test.

The office registers with the DIFC Registrar of Companies and holds a family office licence, not a DFSA licence. The regulations also let a family office serve more than one family, with the Registrar’s approval. That is not a multi-family office: providing financial services to several families by way of business needs DFSA authorisation. Two related branches sharing one office is an arrangement; selling services to unrelated families is a business.

We do not quote DIFC fees: secondary sources disagree, and we could not open the DIFC’s own schedule on 7 October 2026. Ask the Registrar before budgeting.

ADGM single-family office

In ADGM, a pure single-family office holds a controlled-activity licence from the ADGM Registration Authority. It needs no financial services permission, and the FSRA does not regulate it.

As of October 2026, ADGM’s own family-office page states “minimum family net assets of USD 10 million”, measured on the family’s net asset value. ADGM cut its threshold by a notice of 1 May 2025, so older guides may describe a higher test. USD 10 million against the DIFC’s USD 50 million is ADGM’s clearest advantage for families in the USD 10–50 million band. Counsel confirms the rule in force on the filing date.

ADGM lists authority fees, as of October 2026, of USD 5,600 to incorporate a single-family office and USD 5,300 a year to renew; for a multi-family office, USD 16,800 and USD 16,500. Legal work, a registered agent, accounting and audit come on top.

Once an ADGM office serves other families, it needs FSRA permission. ADGM describes multi-family offices as “lightly regulated” under Category 4, the category for advising and arranging. Discretionary management of other families’ assets needs a broader permission with more capital.

Onshore UAE: fund rules and routes to onshore investors

Onshore UAE has no federal family-office regime. Outside the financial free zones, families use DMCC or DWTC single-family office licences, which are commercial, not financial.

The federal funds regulator changed its name in 2026. Federal Decree-Laws No. 32 and No. 33 of 2025, in force since 1 January 2026, renamed the Securities and Commodities Authority (SCA) as the Capital Market Authority, its legal successor. Earlier SCA decisions stay in force where they do not conflict. We call it the UAE CMA here, to keep it apart from Saudi Arabia’s CMA.

The fund rules still run under SCA Decision No. 1/RM of 2023, issued on 16 January 2023 and effective from 1 February. It introduced family funds, whose units only members of one family may hold, and cut the capital requirement for fund management companies from AED 50 million to AED 1 million.

Three routes reach onshore investors, as of October 2026:

1. An onshore manager licensed by the UAE CMA launches a UAE fund.
2. A DIFC or ADGM manager passports a free-zone fund onshore under the UAE Fund Passporting Regime, with the UAE CMA’s approval.
3. For professional investors, a foreign fund registers with the UAE CMA and is marketed through a locally licensed promoter.

Retail is narrower. SCA Decision No. 4/RM/2023 stopped the promotion of foreign funds to UAE retail investors; the grace period for registered funds ended on 31 March 2024. Retail investors now reach foreign strategies through local or passported funds, which is why several global managers built DIFC feeder funds.

Family office in Saudi Arabia

We found no dedicated family-office regime in Saudi Arabia as of October 2026. The Ministry of Commerce oversees the companies that hold family wealth; the CMA oversees investment activity. An office that manages only the family’s own assets is a corporate vehicle; one that manages, advises or deals for others needs a CMA licence as a Capital Market Institution. As of October 2026, the CMA issues five types of licence: dealing, managing investments, arranging, advising and custody.

The July 2025 amendments to the Investment Funds Regulations matter more to fund managers than to families:

• Capital Market Institutions licensed for managing investments may distribute foreign funds to Saudi investors.
• Feeder funds may no longer invest in private funds.
• Public and private funds may be distributed online and through apps, via licensed platforms.
• The CMA may review and cap the fees and commissions a fund manager charges.

Tax shapes the holding structure. As of October 2026, a Saudi company pays Zakat at 2.5% of the Zakat base on the Saudi- and GCC-owned share, and corporate income tax at 20% of net adjusted profits on the rest. A family holding company with foreign co-owners files both.

QFC single-family office in Qatar

Under its dedicated Single Family Office Regulations, the QFC’s set-up page lists four conditions as of October 2026: the office registers with the QFC Company Registration Office; it appoints a Designated Representative ordinarily resident in Qatar; it keeps a registered office in the QFC; and there is no minimum capital requirement. The office exists solely to manage the business, investments and wealth of a single qualifying family.

The QFC’s page states no family-wealth threshold, and we could not confirm one in the regulations on 7 October 2026; counsel confirms it before filing. Managing a fund or advising other families goes to the QFCRA. Proximity to the Qatar Investment Authority is part of Doha’s appeal: a location argument, not an allocation promise.

Bahrain family office regulation

The Central Bank of Bahrain introduced a Family Office Services Module into Volume 4 (Investment Business) of its rulebook in September 2023. A family office falls outside the licensing requirement if it meets three conditions: it provides services only to family clients; it is wholly owned by family clients and controlled by family members; and it does not hold itself out as providing regulated services to the public. Family clients include family members, trusts whose beneficiaries are family members and companies wholly owned by, and run for, family members.

An office that fails any condition needs a CBB licence, in one of the legal forms the module sets out.

Oman and Kuwait

We found no dedicated family-office regime in Oman (Financial Services Authority, since March 2024) or Kuwait (Capital Markets Authority) as of October 2026. A family’s own holding company is a corporate matter; managing others’ money needs the regulator’s licence.

Why

Sharia succession and Sharia-compliant investing are two separate questions

Succession under Sharia is mandatory for Muslim families: the law applies whether or not anyone plans for it. Sharia-compliant investing is a choice until a firm or fund claims it; then it becomes a regulated promise. Families that confuse the two over-engineer their investment policy or under-engineer their succession.

Sharia inheritance law in the UAE: Faraid and the one-third will

For Muslims, Federal Decree-Law No. 41 of 2024 on Personal Status governs inheritance in the UAE. It came into force on 15 April 2025 and replaced Federal Law No. 28 of 2005. It applies Faraid: fixed shares for named heirs that a will cannot change. A Muslim may direct up to one-third of the estate by will, after debts and funeral costs. A bequest beyond one-third takes effect only to the extent the heirs consent, and a bequest to someone who is already a Sharia heir also needs the other heirs’ agreement. Where a Muslim leaves no will, the courts apply Sharia.

The 2024 law also lets non-citizen Muslim residents ask a UAE court to apply their home country’s personal status law, if the court accepts and that law does not conflict with UAE public order. That is a case-by-case court decision, not an advance election, and it does not help a citizen family.

Non-Muslims sit under Federal Decree-Law No. 41 of 2022 on Civil Personal Status, in force since 1 February 2023: without a will, half the estate goes to the surviving spouse and half to the children, equally regardless of gender. Non-Muslims can also register a will with the DIFC Courts or the Abu Dhabi Judicial Department. Dubai Law No. 2 of 2025, issued on 3 March 2025, gave the DIFC Courts exclusive jurisdiction over non-Muslim wills registered with them, and power to enforce them on assets inside or outside the DIFC. It does not change Faraid.

For a Muslim founder, at least two-thirds of whatever the founder owns personally at death passes in fixed shares, and a business held directly fragments with it. Succession planning, deciding in advance who will own and control what, therefore asks not “what should the will say” but “what should the founder own at death”.

Foundations and the holding stack for Muslim families

A foundation is a legal entity, distinct from the founder, that holds assets for beneficiaries or a purpose set out in its charter. The UAE offers three regimes: the ADGM Foundations Regulations 2017, the DIFC Foundations Law (DIFC Law No. 3 of 2018) and the RAK ICC Foundations Regulations, in force since 15 December 2019. Our piece on DIFC and ADGM foundations explains the vehicle itself.

For a Muslim family, the typical stack has three layers: a foundation at the top, a holding company (a company that exists to own the shares of the others) beneath it, and the operating businesses beneath that. The founder contributes the holding company shares to the foundation during his lifetime. Control then sits at a single point that does not die and does not pass by inheritance. The foundation’s council and its rules decide who votes the shares and how income reaches the family.

This is not a way around the faith. Families can write distribution rules that mirror Faraid shares, so each heir receives the economic benefit Sharia assigns while the business stays whole, and a scholar can review the charter and by-laws from the outset. The structure separates who benefits, which follows Faraid, from who controls, which follows the family’s governance.

Four tools usually sit around the stack:

• A shareholders’ or buy-sell agreement among the heirs who do hold shares directly, so a departing heir sells at a fair price instead of to an outsider.
• Life insurance or takaful to give heirs liquidity, so nobody needs to sell shares to pay their way.
• A family constitution that sets out who sits on the council, how the next generation qualifies for roles and how disputes are settled.
• The UAE Family Business Law, Federal Decree-Law No. 37 of 2022, in force since early 2023, which lets a family register its company as a family business and states that share transfers made under it do not breach the personal status law.

What the courts have not settled

Courts have not fully tested whether heirs can challenge foundation or trust distributions as contradicting Sharia. The founder’s capacity at transfer and the gap between transfer and death matter, and interpretations vary between schools of jurisprudence. No structure is safe because a document says so. The family’s licensed counsel and its own Sharia scholar sign off the charter, the by-laws and the transfers, and the family keeps a record of the reasoning.

Sharia-compliant investing: optional until you claim it

No GCC regulator requires a family office or a fund to invest Islamically; obligations begin when a firm holds itself out as Islamic or Sharia-compliant. A single-family office can invest in a Sharia-compliant way purely as internal policy. An investment policy statement (IPS) is the written rulebook for how a family’s money is invested; the office writes the Sharia rule into it: which screens, which scholar or board reviews them, how purification works, what happens on a breach. No endorsement is needed, because the office offers nothing to anyone else. Many families have a scholar or small board review the policy each year, and our investment oversight work checks that the regulated managers who run the portfolios stay inside it.

Onshore, the rules bind banks, not families. In the UAE, Higher Sharia Authority Resolution No. 18/3/2018 made AAOIFI’s Sharia standards binding from 1 September 2018 on Islamic banks, Islamic windows and finance companies. It does not reach a free-zone family office. In Bahrain, the CBB requires its Islamic bank licensees to comply with AAOIFI’s accounting standards and the Sharia pronouncements of AAOIFI’s Sharia board. In Saudi Arabia, the CMA’s Instructions for Shariah Governance in Capital Market Institutions, approved in June 2022 with some articles operative from 1 July 2023, require a Capital Market Institution that offers Sharia-compliant products to have a Shariah committee.

DFSA Islamic finance rules and the Islamic endorsement

In the DIFC and ADGM, holding out as Islamic is a licensing event. A firm that holds itself out as conducting Islamic financial business needs an Islamic endorsement on its licence, as a wholly Islamic firm or as an Islamic window. It must appoint a Sharia supervisory board (the DFSA’s Islamic Finance Rules require at least three members), run systems and controls that keep its Islamic business compliant, and disclose which board reviewed each product. ADGM’s Islamic Finance Rules apply in parallel to firms carrying on Islamic financial business and to managers of ADGM funds operated as Islamic funds.

The DFSA is clarifying the line. Its Consultation Paper No. 172, “Enhancements to the Islamic Finance Rules”, issued in May 2026 with comments due by 19 June 2026, proposes that a firm needs the endorsement when it says it conducts business under Sharia, provides a financial service in relation to an Islamic product, or manages a fund held out as Islamic or Sharia-compliant. A firm that only distributes Islamic products, such as sukuk or takaful, on an execution-only basis and makes no Sharia representations would not. As of early October 2026, we found no final rules published: these are proposals. The DFSA’s July 2026 fund-framework consultation, Consultation Paper No. 173, also touches the Islamic Finance Rules.

A succession map and a holding stack built at different times by different advisors rarely agree. The fastest first step is a written second opinion: one written review of the entities, succession exposure and licences, with the gaps in priority order. Where the work goes further, our succession and structuring service coordinates the family’s counsel and scholar to one brief.

Why

Sharia-compliant funds in the GCC: an operating model, not a label

Sharia compliance is an operating model, not a marketing label. Managers who treat it as a label build a share class, appoint a board and stop. Managers who treat it as an operating model redesign how the fund holds cash, hedges, borrows, reports and sells. Gulf investors can tell the difference. This section covers Sharia-compliant funds in the UAE and the wider Gulf, for managers and for the families who question them.

Why Gulf investors expect Sharia compliance

In Gulf retail and private banking, Sharia compliance is the default rather than a niche.

Demand is broad, as the figures show. Supply, in our reading, is uneven: Islamic money-market, sukuk and listed-equity products are easy to find, while credible shariah compliant private equity funds, private credit and real estate funds from international managers are thinner.

What a Sharia-compliant fund requires

Six components, each of which an informed Gulf investor checks.

1. A credible Sharia supervisory board. The board approves the fund’s structure, documents and screening methodology, issues certificates and reviews compliance over the fund’s life. Recognised scholars carry weight across the region; an unknown board invites questions. Because interpretations vary between schools, the board’s views on contested points are written down.
2. Screening. Business-activity screens exclude conventional banking and insurance, alcohol, pork, gambling and adult entertainment, and usually tobacco and weapons. Financial-ratio screens then test what remains. AAOIFI Sharia Standard No. 21 on financial papers sets interest-bearing debt below 30% of market capitalisation, interest-bearing cash and securities below 30%, and non-permissible income below 5% of revenue. MSCI’s Islamic index methodology uses total assets as the denominator instead, with a 33.33% limit for debt and for cash plus interest-bearing securities, and the same 5% income limit. Thresholds differ by provider; the fund names its standard.
3. Purification. The fund calculates residual income from non-compliant sources, such as interest on a portfolio company’s cash, gives it to charity and reports the amount to investors.
4. Operational redesign. Cash sits in Islamic money-market funds or commodity murabaha, not interest-bearing deposits. No conventional leverage. No conventional short-selling or derivatives. Hedging runs through wa’d-based and other Islamic structures. Fixed income means sukuk, not conventional bonds.
5. Licensing. In the DIFC and ADGM, a manager of a fund held out as Islamic needs the Islamic endorsement and a firm-level board, as described above. In Saudi Arabia, the CMA’s Shariah governance instructions apply to Capital Market Institutions offering Sharia-compliant products.
6. Ongoing Sharia audit and monitoring. A periodic Sharia audit, a breach log and a forced-divestment rule: when a holding fails a ratio, the fund sells within a set period and purifies any gain the board says must go.

The trade-offs: tracking error, cost and strategies that resist conversion

Screens change the portfolio. Excluding conventional financials and highly indebted companies tilts an equity portfolio towards technology and healthcare, which brings tracking error against a conventional benchmark and more concentration.

Costs are real. Scholar fees, the Sharia audit, purification administration, Islamic cash and hedging, and extra legal work add a fixed layer: workable at scale, but for a small fund or share class it can consume a meaningful part of the management fee.

Some strategies resist conversion. Buyouts financed with conventional debt, conventional credit and long/short equity all need restructuring that changes the product: Islamic acquisition finance, asset-backed credit instead of interest-bearing loans, no conventional shorting. Ask early whether the Sharia-compliant version is still the strategy investors are buying. Sometimes it is not.

How international managers reach GCC investors: a six-step playbook

What managers who succeed with GCC investors tend to do:

1. Launch a parallel vehicle rather than converting the flagship. An Islamic share class, a feeder fund or a parallel fund keeps the conventional strategy intact for existing investors and gives the Sharia board a clean structure to approve.
2. Win the Islamic banks’ private-banking platforms. In much of the Gulf they are the gatekeepers to Sharia-sensitive wealth. Their product committees run their own Sharia review on top of the fund’s.
3. Domicile locally where it helps. DIFC or ADGM funds can be passported onshore with the UAE CMA’s approval. In Saudi Arabia, the July 2025 rules let Saudi CMA-licensed managers distribute foreign funds. A local licensed partner is usually the realistic entry. In 2024, for example, Franklin Templeton set up two DIFC umbrella funds, one conventional and one Shariah-compliant, whose sub-funds feed internationally domiciled UCITS funds and reach onshore UAE and ADGM investors under the passporting regime.
4. Lead with under-served asset classes. Private equity, Islamic private credit and private real estate, where credible international products are thinnest.
5. Pitch two buyers at once. The patriarch or matriarch weighs religious legitimacy and legacy. The family-office chief investment officer weighs returns, fees and governance. A pitch that serves only one of them stalls.
6. Build investor reporting around Sharia. Each report carries the board’s certificate, the screening methodology, the purification amount, any breaches and how they were remedied.

Sharia-washing and compliance drift

Gulf investors are sophisticated. A weak board, opaque screening or a missing purification report travels quickly through family networks, and a manager rarely gets a second meeting. Regulators are also tightening what counts as holding out as Islamic, as the DFSA’s consultation shows. Compliance drift is the quieter risk: a holding breaches a ratio after a market move, and nobody acts because no process exists. Forced selling belongs in the investment process, with its timetable and purification rule, not improvised after the board’s audit.

Fund managers who want help with structure, Sharia governance and what Gulf family offices expect can get in touch and book a meeting.

How

How to sequence GCC structuring decisions: two tracks

Families and fund managers face the same three questions from opposite sides. Each track puts the expensive, hard-to-reverse decisions first.

On both tracks, the first three steps cost the most to redo. A jurisdiction chosen before the succession map, or a domicile chosen before anyone tests the strategy against the screens, locks in a structure that later decisions must work around.

When

When to review a GCC family office or fund structure

A structure that fitted the family five years ago may not fit it now. Review it after any of these events:

• The founder’s age or health. Faraid applies to whatever the founder owns personally at death. The review is cheapest while the founder can still sign.
• A generational transition. New council members, branches and spouses. The family constitution and the foundation’s rules must keep pace; our family governance work exists for this.
• A liquidity event or business sale. Cash replaces operating shares, and Sharia-compliant investing becomes a practical question.
• Relocation to or from the Gulf. A family moving between Lisbon and Dubai changes which personal status law applies and where its entities should sit; our Portugal vs Dubai comparison covers the residence side.
• Admitting outside investors or co-investors. This moves the office across the third-party-money line and into licensing.
• Launching a fund or entering a new GCC market. Each market has its own distribution channels and Sharia expectations.
• Regulatory change. Two live examples as of October 2026: the DFSA’s Consultation Papers 172 and 173, and ADGM’s lower threshold since May 2025. A family below the DIFC’s USD 50 million line may now qualify in ADGM; one asking do I need a family office at all should start there.

The renewals and filings these decisions create (licences, annual threshold confirmations, foundation filings, Zakat and tax returns) belong on one calendar. Our administration and back office work keeps it.

Where PWA fits in a GCC structure, and where it stops

PWA — Private Wealth Advisory is the independent architecture layer. For a family, we map the entities, succession exposure and licences across every jurisdiction involved, and coordinate the lawyers, Sharia scholars, banks, fund administrators and the family’s regulated managers to one brief, without replacing any of them. Our Gulf economies in 2026 piece gives the wider context.

For a family assessing a fund, we put the questions from the fund section to the manager in writing and have the family’s own scholar and counsel answer the Sharia and legal points. We do not certify Sharia compliance and give no religious opinion. For a fund manager, we help with structure, Sharia governance and what Gulf family offices expect. We do not market, arrange, promote or place funds, and we introduce no manager to any investor. More on how this works is in coordinating family advisors.

When we work for a family, the family pays us, and only the family: no commissions or retrocessions from anyone. We also work with fund managers, as consultants or within their structure, depending on the engagement. Each engagement has one client and one source of payment; we are never paid from two sides on the same matter.

PWA does not manage money, hold mandates, take commissions or give regulated investment, tax or legal advice.

This guide is not legal, tax or religious advice. Every rule, threshold and fee above is dated and can change; the family’s licensed counsel and its Sharia scholar decide what applies. More guides on structure and succession are in the Library.

The aim is a structure that respects the family’s faith, protects control and outlasts the founder.

Questions we hear

Does a single family office in the UAE need a licence?

Not a financial licence, if it serves only one family’s own wealth. In the DIFC it registers with the Registrar of Companies under the Family Arrangements Regulations 2023; in ADGM it holds a controlled-activity licence from the Registration Authority. Serving unrelated families by way of business, or managing outside investors’ money, needs DFSA or FSRA authorisation (as of October 2026).

What are the DIFC family office requirements?

As of October 2026, the family must hold at least USD 50 million in aggregate net assets, counting the whole family’s wealth, including operating businesses and property, not just what the office manages. The office registers under the DIFC Family Arrangements Regulations 2023, in force since 31 January 2023, and confirms the threshold each year at renewal.

What is the minimum wealth for an ADGM single family office?

As of October 2026, ADGM’s own website states minimum family net assets of USD 10 million, measured on the family’s net asset value rather than the office’s balance sheet. ADGM cut the threshold by a notice of 1 May 2025, so guides written before then may quote a different test. Counsel confirms the rule in force before filing.

Can you set up a family office in Saudi Arabia?

Yes, as a company registered with the Ministry of Commerce, but we found no dedicated family-office regime in Saudi Arabia as of October 2026. An office that manages only the family’s own wealth is a corporate vehicle. Managing outside money, or advising and dealing for others, needs a Capital Market Authority licence as a Capital Market Institution.

How does Sharia inheritance work in the UAE?

For Muslims, Federal Decree-Law No. 41 of 2024 on Personal Status, in force since 15 April 2025, applies fixed Sharia shares, known as Faraid. A will can direct up to one-third of the estate; more needs the heirs’ consent. Without a will, courts apply Sharia. Non-Muslims can use civil personal status law or a registered will.

Can a foundation protect a family business from being split among heirs?

It can keep control in one place. A foundation that owns a holding company does not die, so the shares in the operating businesses do not pass through the founder’s estate. Its rules can distribute benefits in line with Faraid. Courts have not fully tested such structures, so the family’s counsel and its Sharia scholar sign off.

What makes a fund Sharia-compliant?

A Sharia supervisory board that approves the structure, business and financial-ratio screens, purification of residual non-compliant income, Islamic cash management and hedging, and ongoing Sharia audit and reporting. In the DIFC and ADGM, a firm that manages a fund held out as Islamic also needs an Islamic endorsement on its licence, as of October 2026.

What does a Sharia supervisory board do?

It approves a fund’s structure, documents and screening methodology, issues certificates of compliance, oversees purification and reviews compliance over the fund’s life. DFSA rules require at least three members on the board of a firm conducting Islamic financial business. Investors judge a fund partly by who sits on its board and how often it meets.

Do I need a DFSA Islamic endorsement to sell an Islamic fund?

If your DIFC firm holds itself out as conducting Islamic business, or manages a fund held out as Islamic, yes. Under DFSA Consultation Paper 172, which closed on 19 June 2026, a firm that only distributes Islamic products without making Sharia representations would not need one. As of early October 2026, we found no final rules published.

How can a foreign fund be offered to investors in the GCC?

Through local licensed channels. In the UAE, a DIFC or ADGM fund can be passported onshore with the approval of the UAE Capital Market Authority, formerly the SCA, and a foreign fund can reach professional investors through a locally licensed promoter. In Saudi Arabia, CMA-licensed managers may distribute foreign funds since July 2025. Rules differ by investor type.

Sources

All pages opened or searched and checked on 7 October 2026. Where a regulator’s page blocked automated access, the secondary source that reproduces the rule is named.

Family-office regimes

• Dubai International Financial Centre, Family Arrangements Regulations (consolidated, updated August 2023). Supports: DIFC family office regime; USD 50 million minimum net asset requirement. difc.com
• private.law wiki, “DIFC Family Office”, checked 7 October 2026. Supports: in force 31 January 2023; replaced the Single Family Office Regulations of 27 December 2011; removal of DFSA DNFBP registration; aggregate family net assets, including operating businesses and real estate; annual confirmation; third-party money as the DFSA line. wiki.private.law
• Al Tamimi & Company, “DIFC Family Office” (Law Update). Supports: a family office may serve more than one family with the Registrar’s approval; multi-family offices serving families by way of business need DFSA authorisation. tamimi.com
• Abu Dhabi Global Market, “Family Offices” set-up page, checked 7 October 2026. Supports: minimum family net assets of USD 10 million; controlled licence activity, no financial services permission; multi-family offices under FSRA Category 4; fees USD 5,600 / 5,300 (single-family office) and USD 16,800 / 16,500 (multi-family office). adgm.com
• ATB Legal, “ADGM’s Mid-2025 Rule Updates”. Supports: a 1 May 2025 notice cut the minimum asset threshold for ADGM single-family offices. atblegal.com
• Qatar Financial Centre, “Single Family Offices”, checked 7 October 2026. Supports: Single Family Office Regulations; CRO registration; Designated Representative ordinarily resident in Qatar; registered office in the QFC; no minimum capital; no asset threshold stated. qfc.qa
• Al Tamimi & Company, “The Central Bank of Bahrain issues new regulation in relation to investment services provided by family offices”, 21 September 2023; and CBB Rulebook Volume 4, Family Office Services Module, October 2023. Supports: module introduced 14 September 2023; three exemption conditions; definition of family clients. tamimi.com · cbben.thomsonreuters.com
• Al Tamimi & Company, “The establishment of the Financial Services Authority in Oman”, 28 March 2024; Royal Decree 20/2024. Supports: FSA established 25 March 2024, replacing the Capital Market Authority. tamimi.com · decree.om
• UN ESCWA Arab Legislation Portal, “Law 7 of 2010 on Establishing the Capital Markets Authority” (Kuwait). alp.unescwa.org

UAE and Saudi fund rules

• King & Spalding, “A New Era for UAE Federal Securities Regulation: The 2025 CMA Decree-Laws”, 13 February 2026. Supports: Federal Decree-Laws No. 32 and 33 of 2025; SCA renamed Capital Market Authority; in force 1 January 2026; one-year regularisation; earlier decisions remain in force where consistent. kslaw.com · Latham & Watkins, “Major Updates Recalibrate the UAE Capital Markets Regime” (CMA as legal successor of the SCA, effective 1 January 2026). lw.com
• Hadef & Partners, “New UAE Investment Funds Regime”. Supports: SCA Decision No. 1/RM of 2023, issued 16 January 2023, effective 1 February 2023; family funds; fund manager capital cut from AED 50 million to AED 1 million. hadefpartners.com
• Simmons & Simmons, “Promotion of foreign funds to UAE retail investors: what’s next?”, 1 April 2024, as reported in the trade press on 2 April 2024. Supports: Decision No. 4/RM/2023; retail grace period ended 31 March 2024; passporting with the DIFC and ADGM continues; professional investors via licensed promoters. simmons-simmons.com
• King & Spalding, “King & Spalding advises Franklin Templeton on launch of two open-ended umbrella funds in DIFC”, 4 September 2024. Supports: one conventional and one Shari’ah-compliant umbrella; seven sub-funds feeding UCITS funds; offered onshore and in ADGM under the UAE Fund Passporting Regime. kslaw.com
• King & Spalding, “The Capital Market Authority issues key regulatory enhancements impacting investment funds in the Kingdom of Saudi Arabia”, 30 July 2025. Supports: foreign fund distribution by CMIs licensed for managing investments; online and app distribution; CMA fee caps. kslaw.com
• Asia Asset Management, “Saudi Arabian capital market regulator revises investment fund rules”, 30 July 2025. Supports: feeder funds barred from investing in private funds. asiaasset.com
• King & Spalding, “Establishing a regulated financial institution in Saudi Arabia: key considerations for capital market institutions”, February 2025. Supports: five CMA licence types. kslaw.com
• PwC Worldwide Tax Summaries, “Saudi Arabia: Corporate – Taxes on corporate income”, last reviewed 29 July 2026. Supports: corporate income tax 20% on the non-Saudi, non-GCC share; Zakat 2.5% of the Zakat base for Saudi and GCC shareholders. taxsummaries.pwc.com

Succession and foundations

• private.law wiki, “Inheritance in the UAE: Sharia defaults, DIFC Wills and ADJD”, checked 7 October 2026. Supports: Federal Decree-Law No. 41 of 2024 in force 15 April 2025, replacing Federal Law No. 28 of 2005; courts apply Sharia without a will; Federal Decree-Law No. 41 of 2022 in force 1 February 2023, intestacy half to spouse and half to children; DIFC and ADJD wills. wiki.private.law
• Gulf Today, “New personal status law introduced in UAE: here are the details”, 15 April 2025. Supports: entry into force of the 2024 Personal Status Law. gulftoday.ae
• Horizlaw, “Key Amendments and Legal Implications of Federal Decree-Law No. 41 of 2024 on Personal Status for Muslims in the UAE”. Supports: wills executed within one-third of the estate after debts; excess valid only with the heirs’ consent. horizlaw.ae
• LY Lawyers, “New UAE Personal Status Law: Muslim residents opt out of Sharia”. Supports: non-citizen Muslims may request home-country personal status law, subject to court acceptance and public order. lylawyers.com
• Dubai Legislation Portal, Law No. (2) of 2025 Concerning Dubai International Financial Centre Courts, issued 3 March 2025. Supports: Wills Registry for non-Muslims; exclusive jurisdiction over registered non-Muslim wills (Art. 14); enforcement inside or outside the DIFC (Art. 31(5)). dlp.dubai.gov.ae
• DIFC Foundations Law, DIFC Law No. 3 of 2018; ADGM Foundations Regulations 2017. difc.com · adgm.com
• Sovereign Group, “Ras Al Khaimah introduces Foundation structure”. Supports: RAK ICC Foundations Regulations in force 15 December 2019. sovereigngroup.com
• Ocorian, “Shariah-compliant family foundations UAE”. Supports: DIFC and ADGM foundations can be established to Shari’ah principles with appropriate measures. ocorian.com
• Al Tamimi & Company, “Federal Decree-Law No. 37 of 2022 in relation to family companies”, 7 November 2022; Gulf News on the January 2023 effective date. Supports: family business register; share transfers under the law do not breach the personal status law. tamimi.com · gulfnews.com

Islamic finance rules and standards

• Central Bank of the UAE, Higher Shari’ah Authority Resolution No. 18/3/2018. Supports: AAOIFI Shari’ah standards binding on internal Shari’ah supervision committees of financial institutions operating under Shari’ah from 1 September 2018. centralbank.ae
• Central Bank of Bahrain Rulebook, Volume 2 (Islamic banks). Supports: Islamic bank licensees comply with AAOIFI accounting standards and Shari’a pronouncements. cbben.thomsonreuters.com
• Saudi Capital Market Authority, Instructions for Shariah Governance in Capital Market Institutions (Board Resolution 3-77-2022, 22 June 2022), via Mondo Visione, 19 July 2022. Supports: Shariah committee for CMIs offering Sharia-compliant products; some articles operative from 1 July 2023. cma.org.sa · mondovisione.com
• DFSA Rulebook, Islamic Finance Rules (IFR) module, version VER22/12-25, Rule IFR 3.5.1. Supports: Islamic endorsement; Shari’a Supervisory Board of “at least three members”; disclosure of the board. dfsaen.thomsonreuters.com · dfsa.ae
• ADGM FSRA, Islamic Finance Rules (IFR). Supports: application to firms carrying on Islamic financial business and to fund managers of Islamic funds. adgm.com
• Pinsent Masons Out-Law, “DFSA opens consultation on Islamic finance rules changes”, 13 May 2026; Waystone Compliance Solutions, “Regulatory Update May 2026 – ME Region”. Supports: CP 172 issued 4 May 2026; endorsement triggers; execution-only distribution exempt; comments due 19 June 2026. pinsentmasons.com · waystone.com
• Waystone Compliance Solutions, “Regulatory Update July 2026 – ME Region” and “Regulatory Update August 2026 – ME Region”. Supports: CP 173 on the fund framework (7 July 2026, includes the IFR module); no final CP 172 rules reported through August 2026. waystone.com (July) · waystone.com (August)
• AAOIFI, “About AAOIFI”. Supports: established 1991, based in Bahrain, not-for-profit standard-setter. aaoifi.com
• IFSB, “Inaugural Council Meeting and General Assembly of the Islamic Financial Services Board”. Supports: IFSB founded 2002, Kuala Lumpur. ifsb.org
• AAOIFI Shari’ah Standard No. 21, Financial Papers (Shares and Bonds). Supports: 30% interest-bearing debt, 30% interest-bearing cash and securities, 5% non-permissible income. pse.com.ph
• MSCI, “MSCI Islamic Indexes Methodology”, January 2023. Supports: 33.33% of total assets for debt and for cash plus interest-bearing securities; 5% impure income. msci.com

Market figures

• Fitch Ratings, global public Islamic funds report, March 2024, as reported by The Edge Malaysia. Supports: Islamic funds close to 80% of total public funds in the GCC at end-2023. theedgemalaysia.com
• BNY Wealth, “Shaping the Future: Single Family Offices in the Gulf Region”, May 2025. Supports: 93% of surveyed Gulf single-family offices call Shariah compliance very or moderately important (survey of offices in Saudi Arabia, the UAE and Kuwait). bny.com
• BCG, “Global Asset Management Report 2026”, GCC press release via Zawya. Supports: GCC AuM USD 2.7 trillion in 2025, up 10%; 93% institutional, 7% retail. zawya.com
• Islamic Financial Services Board, “IFSB Releases Islamic Financial Stability Report 2026”, 26 May 2026; Daily Trust, 7 July 2026. Supports: global Islamic financial services assets about USD 4.4 trillion in 2025, up 13.4%. ifsb.org · dailytrust.com

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Pedro Souto is the founder of PWA — Private Wealth Advisory. He works with UHNW founders, families, and single-family offices to build an independent operating layer around complex wealth — combining markets, analytics, technology, and governance to turn fragmented advice into one coherent picture, and to make someone, finally, responsible for the whole of it.