- within Family and Matrimonial, Criminal Law and Wealth Management topic(s)
The Middle East has firmly established itself as the world's fourth-largest wealth hub, powered by rapid economic growth, government investment, and entrepreneurial ambition1. Family businesses sit at the centre of this landscape, employing a substantial share of the private-sector workforce and shaping commercial norms and decision‑making across the region.
Yet, this prosperity brings forward complex legal challenges. Much of the region's wealth has been created within the last 50 years, meaning many families are now navigating their first major intergenerational wealth transfer. With an estimated USD 1 trillion expected to pass to the next generation by 20302, succession planning, wealth preservation, management and governance have never been more critical.
Despite this urgency, many families remain underprepared. A survey conducted in 20253 highlights the scale of this issue. Nearly half of families continue to postpone planning, not due to lack of opportunity, but because of internal divisions and generational friction. Among those who have started the process, almost a quarter report that family sensitivities and diverging views have stalled progress. Other challenges identified are limited access to expert advice, difficulty balancing traditional values with the need to modernise family and business leadership, lack of interest from family head and the next generation.
Beyond these internal dynamics, families must also navigate a complex legal environment. Succession planning in the Middle East is further complicated by the need to accommodate Sharia‑based inheritance principles. In practice, planning often proceeds along two parallel tracks (conventional legal structures and Sharia considerations) adding an additional layer of complexity to restructuring family businesses for future generation.
Absent structured planning, the transition from one generation to the next can be a critical turning point that results in operational complications, financial disputes, and, in the worst cases, the collapse of both the business and family relationships. In response, the number of families implementing governance frameworks and exploring private wealth solutions to secure their legacy is increasing.
Against this backdrop, this article focuses on private wealth structures available under the Qatar Financial Centre (QFC) regime, in particular trusts, holding companies, single family offices, and family foundations. It explores how such structures can support orderly succession and governance for family businesses. It does not cover QFC fund structures or other legal structures available outside the QFC regime, nor does it address tax, operational, Sharia or other specific considerations in restructuring the family businesses for succession planning purposes.
Trusts
In Qatar, trust structures are available only under the QFC regime and are governed by the QFC Trust Regulations4. A trust is not a separate legal entity; rather it is a fiduciary arrangement where a settlor transfers assets to a trustee to hold and manage for the benefit of one or more beneficiaries. Legal title to the trust assets vests in the trustee, who is bound to administer them in accordance with both the trust deed and the provisions of the QFC Trust Regulations.
Trusts are commonly recognised as effective tools for wealth planning, protection and succession. In this context, they offer two main advantages. First, they separate legal and beneficial ownership of trust assets, thereby ensuring continuity across generations and, in general, ring‑fencing trust assets from third party claims against both, the settlor and trustees. Second, they are inherently flexible. Their terms can be tailored to reflect family dynamics, objectives, whether by establishing fixed entitlements or by granting discretionary powers to the trustee. Trusts may be established to continue indefinitely or to terminate at a time specified in the trust instrument or under the QFC Trust Regulations.
Beyond succession planning, trusts can also serve as a mechanism for strengthening corporate governance for family businesses. For example, shares in subsidiaries may be consolidated within holding companies that are themselves owned by a trust. A corporate trustee, supported by a board that includes both family members and independent directors, can then oversee stewardship of the business. This arrangement separates management and control from beneficial ownership, protecting the business from short‑term family pressures and ensuring that long‑term goals remain at the forefront.
If properly structured, trusts can balance family sensitivities with commercial priorities, ensuring that assets are protected, businesses remain resilient, and legacies are preserved across generations.
Holding Companies
Holding companies are incorporated as limited liability companies under the provisions of the QFC Special Company Regulations5 and QFC Special Company Rules6 in conjunction with QFC Companies Regulations7. They have the capacity, rights and privileges of a natural person and can perform a variety of activities including raising finance, providing security or guarantees, managing or ring-fencing risk, acquisition and commercially driven restructurings, holding and divesting assets.
They can sit above operating subsidiaries and asset‑holding vehicles to centralise ownership and control of a family business group. By consolidating shares and other strategic assets at a single holding company level, families can separate day‑to‑day operations from capital and control, which is the foundation for orderly succession and governance. Subsidiaries and asset-holding vehicles need not be incorporated in the QFC, which allows families to use the holding company as a hub for global assets and operations.
Succession planning is simplified when ownership interests are allocated at the holding company level rather than fragmented across operating subsidiaries. Families can issue different classes of shares to balance the interests of active and passive heirs, for example by granting voting rights to those engaged in the business while providing non‑voting shares to those who are not.
Governance frameworks within QFC holding companies benefit from a high degree of structural flexibility. Unlike the mainland regime, the QFC allows family businesses to design and implement bespoke governance arrangements, provided they comply with applicable rules and regulations. This flexibility enables family businesses to tailor governance to their values, risk appetite, and long‑term succession objectives. As a result, families can adopt constitutions, shareholder agreements, and board charters that define decision‑making rights, establish procedures for handling conflicts of interest, and set out how the holding company board interacts with the family council (if any). Independent directors may also be appointed to provide continuity, resolve disputes, and bring professional expertise to strategic oversight.
Day‑to‑day operations remain the responsibility of subsidiary's boards and executives, while the holding company board provides strategic oversight. This layered governance ensures that family values are embedded at the top level while professional management drives operational performance.
Holding companies are not only succession tools but also vehicles for growth. They can ring‑fence liabilities between subsidiaries, protecting core family assets from commercial exposure. They can also facilitate IPOs, partial divestments, or external investment, giving families flexibility to pursue liquidity or expansion when the time is right.
Single Family Offices
In 2023, the QFC Authority ("QFCA") introduced a dedicated regulatory framework for single family offices (SFOs) through the Single-Family Office Regulations8 and Rules9. Under this framework, a SFO is defined as a legal entity established solely to manage the wealth, assets, and affairs of a single family. For these purposes, a "single family" refers to a group of individuals who are bloodline descendants of a common ancestor, together with their spouses (including widows and widowers, whether or not remarried). This ensures privacy and exclusivity by strictly prohibiting the provision of services to third parties.
To operate as an SFO, an entity must be incorporated as a limited liability company within the QFC, hold a QFCA licence, and maintain a minimum of USD 5 million in investable assets. The framework imposes ongoing obligations such as record-keeping, AML/KYC compliance, and annual filings while allowing operational flexibility within a clear supervisory regime.
Once licensed by the QFCA, the SFO may offer a range of highly personalised and specialised services tailored to (i) one or more family members (ii) a family fiduciary structure, or (iii) a family entity. Although SFOs are as unique as the DNA of their founders, their typical services include investment management, administration of trusts, foundations, and holding companies, philanthropy, and reporting/compliance. They also provide lifestyle support such as real estate oversight and coordination of professional advisers. It is important to note that the scope of services offered—whether delivered directly or outsourced—typically depends on the purpose of establishing the family office and the expectations of family members. Generally, an SFO acts as a centralized hub for financial, administrative, and governance functions, enhancing control, confidentiality, and efficiency by consolidating responsibilities that might otherwise be spread across multiple advisers.
An SFO can play an important role in strengthening succession planning and governance within family businesses. It does so by educating and engaging next-generation family members through tailored training programmes and participation in governance committees. By sequencing roles and responsibilities, the SFO helps reduce fragmentation and succession risks, while harmonising family and corporate policies to ensure alignment. It also clarifies the distinct roles of owners, boards, and management, and establishes structured frameworks for reporting, risk management, and conflict resolution. Through centralised information flows and robust governance protocols, an SFO supports orderly transitions and preserves continuity across generations.
Family Foundations
Family foundations are incorporated under the QFC Foundation Regulations10 and Rules11. In contrast to trust, a family foundation is a distinct legal entity, offering the capacity, rights, and privileges of a natural person, thereby permitting the separation of liability between the founder and the foundation. This means a family foundation can own assets of any type, enter into contracts, sue and be sued, and operate independently of its founder—an advantage over trusts, which are fiduciary relationships.
A family foundation is created when a founder endows assets for specified purposes and for the benefit of identified beneficiaries or classes of beneficiaries. Title to the assets vests in the foundation itself, not in the founder. The family foundation is administered by a council in accordance with its constitution, and an enforcer must be appointed to oversee key decisions and ensure that the council acts in the best interests of the foundation. The founder may sit on the council, enabling ongoing influence over strategic direction.
Family foundations can serve as an effective vehicle for family succession and governance, as they combine the asset segregation and perpetuity features typically associated with trusts with a corporate-style governance framework. The founder can set high level purposes and objectives, define the role of beneficiaries and other stakeholders, and set parameters for how the council exercises its powers. Since the foundation owns assets in its own name, it can provide robust protection against personal claims affecting the founder or individual family members, supporting continuity across generations.
Family foundations are often utilised to hold shares in family holding companies, enabling centralised ownership and facilitating streamlined succession planning. They can also hold different classes of shares to distinguish between active and passive heirs, with internal governance rules defining the application of voting and economic rights. The framework under the QFC also provides international flexibility. The foundation property, founder(s), dedicator(s), members of council, and beneficiaries can be from any jurisdiction acceptable to the QFCA12. This makes QFC foundations an attractive option for families with global assets and cross-border considerations.
Conclusion
All these structures can be combined and integrated to create tailored solutions for asset protection, governance, and succession planning for family businesses. For instance, a holding company may be owned by a trust or foundation, while its assets may be managed by a single-family office. Likewise, a trust's assets can be managed by a single-family office acting in its capacity as trustee. In more sophisticated arrangements, a single-family office, a trust, and a holding company may be layered together: trustees hold ownership and control of the holding company, while the family office provides fiduciary, administrative, and advisory services to the trust, as well as management and operational support to the holding company.
However, it is important to recognize that every family business is different, and every family is unique. Objectives, values, and internal dynamics vary widely, meaning there is no universal "one‑size‑fits‑all" solution. The viability of any structure depends on a range of factors, including the nature of the business and the type of activities it undertakes, the geographic location of operations and assets, the presence of real property and the jurisdictions in which they are held, and the complexity of family arrangements and governance requirements, as well as other considerations such as family law and inheritance regimes, Sharia principles, and tax implications. Families should also ensure that they fully understand the legal consequences of the chosen structure, that they are prepared to accept and live with those consequences, that all members comply with and implement the structure even if individual preferences differ, that everyone is willing to uphold its integrity, and that ongoing compliance obligations are met consistently and transparently.
Ultimately, selecting the right structure is not simply a legal exercise; it is the outcome of all these commercial, legal, Sharia, tax, and family considerations combined together. It is a reflection of the family's values, its commitment to governance, and its vision for continuity across generations. The QFC provides the legal tools and frameworks, but it is up to each family to determine how best to use them in building resilient, sustainable, and future‑proof businesses.
Footnotes
4. https://qfcra-en.thomsonreuters.com/rulebook/trust-regulations-2007
5. https://qfcra-en.thomsonreuters.com/rulebook/special-company-regulations
6. https://qfcra-en.thomsonreuters.com/rulebook/special-company-rules
7. Companies Regulations 2005 | Rulebook
8. https://qfcra-en.thomsonreuters.com/sites/default/files/net_file_store/QFCRA_8879_VER4.pdf
9. https://qfcra-en.thomsonreuters.com/sites/default/files/net_file_store/QFCRA_9244_VER3.pdf
10. https://qfcra-en.thomsonreuters.com/sites/default/files/net_file_store/QFCRA_11116_VER1.pdf
11. https://qfcra-en.thomsonreuters.com/sites/default/files/net_file_store/QFCRA_11117_VER2.pdf
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.
