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Transforming the DIFC Courts: Insights into Law No. (2) of 2025 governing the Dubai International Financial Centre (DIFC) Courts

On March 10, 2025, Sheikh Mohammed bin Rashid Al Maktoum issued Law No. (2) of 2025 (the “New Law”), a landmark legislation governing the Dubai International Financial Centre (DIFC) Courts. The New Law replaces the previous DIFC Law No. (10) of 2004 and Dubai Law No. (12) of 2004 (as amended) (collectively referred to as “Old Law”), marking a significant evolution in the DIFC legal framework and transforming the way disputes are resolved within the DIFC.

1. Expanded scope and exclusivity of Jurisdiction

  • Exclusive Jurisdiction: The DIFC Courts now have exclusive authority over civil, commercial, and labor disputes involving DIFC entities, reducing jurisdictional conflicts and providing legal certainty for businesses.
  • Expanded Scope: The DIFC Courts’ jurisdiction has been broadened to include claims arising out of or related to trusts, wills of non-Muslims, and arbitration-related applications, offering a more comprehensive legal framework.

2. Establishing a Mediation Services Centre

  • Alternative Dispute Resolution: The New Law establishes a new Mediation Centre providing an efficient and cost-effective way to resolve disputes amicably, reducing litigation costs and thereby preserving commercial relationships.

3. Judicial Efficiency and Transparency

  • Public Hearings and Judgments: The New Law mandates public access to court proceedings and judgments, enhancing transparency and accountability.
  • Provisional Measures: The DIFC Courts can now issue provisional or interim orders, such as asset freezes, to protect rights effectively.
Feature Old Law (DIFC Law No. 10/2004 & Dubai Law No. 12/2004) New Law (DIFC Law No. 2/2025)
Jurisdiction Parties may agree in writing to have civil or commercial claims or actions heard before the DIFC Courts. Expanded to include cases with employment disputes, trusts, wills of non-Muslims, and arbitration-related applications.
Enforcement of Judgments Less robust mechanisms for enforcing judgments outside the DIFC. Improved mechanisms for enforcing judgments both within the UAE and abroad.
Dispute Resolution Traditional litigation was the primary method. Introduction of a Mediation Centre for civil, commercial, and labor disputes, offering an alternative to litigation.
Alignment with UAE Laws Less emphasis on alignment with UAE federal laws. Strengthened alignment with UAE federal laws to ensure legal harmony across jurisdictions to aid in enforcing judgements.
Provisional Measures Limited ability to issue interim orders. Empowered to issue asset freezes, disclosure orders, and other interim measures to protect rights.
Transparency Less emphasis on public access to court proceedings. Mandates public hearings and announcements of judgments to enhance transparency.
Arbitration Recognition Less streamlined process for recognizing foreign arbitration awards. Simplified process for recognizing and enforcing foreign arbitration awards.
Enforcement Writ No explicit provision for Enforcement Writs. Enforcement was based on court orders and arbitral awards. Explicitly includes judgments, decisions, orders, arbitral awards, and settlement agreements, enhancing clarity and efficiency in enforcement procedures.

 

For parties interacting with the DIFC Courts, the New Law offers several benefits:

  • Legal Certainty: Businesses have clearer guidelines on jurisdiction, reducing legal risks and enhancing contract enforcement.
  • Enhanced Legal Protection: The ability to issue provisional measures provides better protection for individuals’ rights during legal proceedings.
  • Efficient Dispute Resolution: The mediation centre and streamlined procedures reduce the time and cost associated with disputes.
  • Enhanced Enforcement: The New Law strengthens the enforcement of judgments, including the ability to execute judgments against assets outside the DIFC.
  • Increased Transparency: Public access to court proceedings ensures that justice is not only served but also seen to be served.

In conclusion, Law No. (2) of 2025 marks a significant step forward for the DIFC Courts, enhancing legal certainty, efficiency, and transparency. The benefits of streamlined dispute resolution and stronger enforcement mechanisms cannot be overstated and are likely to make the DIFC an even more attractive hub for international business and investment.

At Al Midfa & Associates, we offer comprehensive services tailored to meet your needs, ensuring that your rights are protected at every step of the way. Please feel free to contact us.

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DIFC Introduces Digital Assets Wills

 

Traditional wills often fail to address the technical and legal complexities of digital ownership, leaving heirs unable to access or claim these assets. With the increased popularity of crypto and digital assets within the last few years, the ability to transfer and treat digital assets as you would more traditional assets, such as property, funds or shares, has become a pressing concern for many individuals and investors. Therefore, In October 2024, the Dubai International Financial Centre (DIFC) introduced the innovative Digital Assets Will, providing a groundbreaking framework for distributing digital assets upon passing that resolves these challenges, addressing the critical gaps in estate planning.

 

The Problem of Digital Asset Inheritance

Digital assets pose unique risks in estate planning:

  • Loss of Access: Without explicit instructions, beneficiaries may lack the technical means (e.g., private keys) to access digital wallets.
  • Legal Ambiguity: Many jurisdictions lack clear laws recognising digital assets as transferable property.
  • Security Risks: Centralized exchanges or custodial wallets may freeze accounts upon the owner’s death, leading to permanent asset loss.

The DIFC’s Legal Framework

The DIFC Digital Assets Will operates under Digital Assets Law No. 2 of 2024 and integrates three key components:

  • Non-Custodial Wallet: Built on Hedera Distributed Ledger Technology (DLT), it allows testators to retain complete control of assets during their lifetime while freely allocating them to beneficiaries as specific gifts upon their passing.
  • Tejouri Integration: Digital Assets Wills are linked with the DIFC’s Tejouri digital vault, which securely stores data in encrypted formats. Tejouri provides a unique platform that functions as an online safe for data, supported by a state-of-the-art onsite DIFC data centre and a secondary UAE-based backup data centre. This integration enhances security and accessibility for testators and beneficiaries.
  • Online Registration: The entire process, from drafting to registration, is conducted online. Testators can electronically sign their wills via video conferencing in the presence of witnesses. Once registered, the will is securely stored in the DIFC Courts’ database.

Key provisions include:

  • Support for BTC, ETH, USDC, USDT, MATIC. In the future, the DIFC wallet expects to support NFTs such as ERC 721, ERC 1155, Ordinals and HTS.
  • Flexibility to update beneficiary allocations without revising the entire will.

 

How the Digital Assets Will Works

Case StudyJohn, an investor, uses the DIFC Digital Assets Will to:

  • Register: He drafts his will online, listing his Ethereum holdings and NFTs as “specific gifts” to his children.
  • Assign Assets: Using the non-custodial wallet, he links his crypto wallets and allocates 60% of his Bitcoin to his spouse and 40% to a charitable trust.
  • Secure Storage: His will is encrypted and stored in Tejouri, accessible only to his designated executor.

Upon his passing:

  • The DIFC Courts validate the will via video-conferencing with witnesses.
  • Executors receive access credentials, ensuring seamless asset distribution without third-party interference.

 

Advantages and Implications

The DIFC Digital Assets Will solves critical problems by:

  • Ensuring Control: Testators maintain ownership until death, preventing unauthorised access.
  • Providing Legal Clarity: Digital assets are recognised as property under DIFC law, reducing disputes.
  • Enhancing Security: Decentralized storage and biometric authentication mitigate hacking risks.

For jurisdictions like the UAE, where 23% of residents hold digital assets, this framework positions Dubai as a leader in fintech innovation. 

 

Why This Matters

The DIFC’s solution exemplifies how legal systems can adapt to technological advancements. By addressing ownership, access, and enforcement, the Digital Assets Will offers a replicable model for other jurisdictions grappling with similar challenges. 

The DIFC Digital Assets Will represents a significant advancement in estate planning for the digital age. The UAE is one of the premier destinations for those seeking an organised, safe and promising digital investing environment. By addressing the complexities of digital asset inheritance with innovative solutions like non-custodial wallets and global accessibility, the Introduction of the Digital Assets Will positions Dubai as a leading hub for digital asset management and legal innovation. For individuals, it provides peace of mind—ensuring their digital legacy is preserved as meticulously as their physical one. It also strengthens Dubai’s reputation as a forward-thinking jurisdiction in the evolving world of digital finance.

 

How We Can Help

If you have any questions or require assistance with drafting and registering a Will, either a Simple Will or a Digital Assets Will, please get in touch with us at here.