The UAE Personal Status Law defines ‘inheritance' as ‘the imperative devolution of the property and financial rights upon the death of their owner to those deserving' (Article 313). Inheritance conventionally means handing over one's assets to his/her descendants, family, or other legally entitled beneficiaries. The process becomes complicated when the deceased has not left a will behind. Therefore, the right process would be to have a registered will at hand to ensure that your property and assets are divided as per the provisions of the will, which in turn reflects your wishes.
What happens when there is no ‘will':
When an expatriate dies without a Will then the provisions of the Federal law number 28 of 2005 promulgating the personal status law and its amendment (‘personal status law') and the federal law number 5 of 1985 concerning the civil transaction law (‘civil transaction law') and its amendments apply.
In the absence of a registered will, the following undesirable process may apply by default:
- Immediate freezing of the bank accounts, whether it be a joint bank account or an individual bank account.
- Immediate freezing of investments made in the UAE in the form of shares and other investment options.
- Prolonged and costly litigation process, especially when the assets are being disputed amongst the family members.
New amendment in Personal Laws in the UAE and what it means for you:
The Government of the United Arab Emirates has enacted ground-breaking changes to personal laws to promote multiculturalism and progressivism. The decision amends strict Islamic laws and modernizes several elements of family and personal law to keep pace with changing times. The amendments aim to strike a delicate balance between celebrating the heritage and culture of the Emirates and creating a modern society endowed with laws that reflect its diverse obligations.
What has changed:
The latest changes explicitly allow expats to use the law of their home country for inheritance matters, but in the event that a registered will exists, the terms recorded in the will be followed. Pursuant to the new amendments, the provisions of Article 17 have been replaced by virtue of Article 1 of Federal Decree-Law no. 30/2020 as follows:
- Subject to the provisions of Paragraphs (3) and (4) of this Article, heritage shall be governed by the law applicable in the state of testator at the time of his death.
- The financial rights present on the State's territory and which belong to a foreigner having no heirs shall be transferred to the State.
- The substantive provisions of the will and all actions related to the after-death stage shall be governed by the law of the State as specified by the will or the alienation act, or the law of the state to which the person carrying out such action belonged upon his death if no law is specified by the will or the alienation act.
- The form of the will and all alienations related to the after-death stage shall be governed by the law of the State of the person carrying out such alienations upon the issuance thereof, or the law of the State in which such action took place.
- Provided that the law of the United Arab Emirates prevails regarding the will issued by a foreigner for the real-estates thereof in the State.
With the new changes, the UAE is once again demonstrating its ability to attract millions of people from around the world to live and work here. The changes reflect the welcoming environment sought by the diverse expats and which are important especially for families who settle in the UAE and make it their home.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.