Reviewing a succession arrangement that is already in place

Where articles of association, a charter, shareholder arrangements and wills already exist, a review concerns whether those documents still agree with one another and with current law, rather than what to put in place.

The hierarchy between them is set by statute. Under Federal Decree-Law No. 37 of 2022, where the articles of association and the charter conflict, the articles apply and the conflicting provision is repealed from the charter (Article 6(3)). In the absence or ambiguity of an explicit text in either, both are interpreted in accordance with the common intention of the founders and the partners, in a manner that helps its continuity and smooth transition (Article 22(1)). A condition inconsistent with that decree-law, the legislation in force in the State or public order is invalid while the document itself remains valid (Article 22(2)).

Several instruments that older documents lean on have been reissued or amended. The Civil Transactions Law now in force is Federal Decree by Law No. 25 of 2025, effective 1 June 2026, which replaces the 1985 law of the same name. The consolidated text of the Commercial Companies Law on the official legislation portal carries an Article 14(4), under which partners in a limited liability company or shareholders in a private joint stock company may include in the memorandum or articles provisions obliging others to sell to a third party once pre-agreed conditions are met, allowing a holder to join an existing sale on the same terms, and regulating the mechanism for dealing with the stakes or shares of a deceased partner or shareholder, including a pre-emptive right to purchase at the price agreed with the heirs. A clause that cites a repealed article by number is not necessarily one that no longer works.

Arrangements balanced when written also drift as ownership concentrates or disperses. Where one partner owns a share of not less than 90 per cent of the shares, that partner notifies the non-family partners of a desire to buy their shares, which they have the right to sell at an agreed price or at a price the committee determines where there is disagreement, and a comparable route applies at not less than 95 per cent of the voting shares against the rest of the family partners (Article 9). The percentage of ownership of family members is not to fall below the majority of the shares (Article 8(5)), and where persons from outside the family own the majority of the voting shares, the business ceases to be a family business and is cancelled from the register, continuing in the form it held before (Article 23(1)).

Liquidity provisions sit alongside these. A family business may purchase no more than 30 per cent of its own shares in the cases the law lists, on approval by partners representing the majority of the shares represented at the general assembly, and shares the company holds carry no vote (Article 11).

Disputes have a statutory sequence that older documents may not follow. The articles or the charter may provide for a board of partners, family members or third parties to consider disputes and attempt reconciliation (Article 19(1)). Where they contain no such provision, or that board does not succeed within three months of the dispute being presented to it, disputes go to the committee established in each emirate for family business disputes (Article 19(2) and Article 20), which decides within three months, extendable on a reasoned request, and may take urgent measures to maintain continuity (Article 19(3)), with its decisions subject to appeal to the competent court (Article 19(4)). As an exception, the parties may agree on arbitration or on the courts of the financial free zones (Article 19(5)).

Wills sit beside this rather than above it. A will registered with the DIFC Courts governs the property it deals with under the DIFC Rules and the laws of the DIFC, which the will has to state (Rule 9(1)(g)), and it applies only to the part of the estate to which the testator is entitled at death (Rule 9(2)). A stake in a mainland company moves by the attested instrument and the registration in the commercial register that the Commercial Companies Law requires (Articles 79 and 15).

Sources, retrieved 11 August 2026:

• Federal Decree-Law No. 37 of 2022 on Family Businesses: https://uaelegislation.gov.ae/en/legislations/1608
• Commercial Companies Law, Federal Decree-Law No. 32 of 2021, consolidated text: https://uaelegislation.gov.ae/en/legislations/1542
• Civil Transactions Law, Federal Decree by Law No. 25 of 2025: https://uaelegislation.gov.ae/en/legislations/4011
• DIFC Wills and Probate Registry Rules, version updated 30 June 2019: https://www.difccourts.ae/application/files/6916/0474/0825/DIFC-Wills-and-Probate-Registry-Rules-updated-30-June-2019.pdf

This article is educational. It is written with law firms and describes mechanisms in general terms, and the programme has not verified or endorsed any structure described here. A family should take its own legal, tax and Sharia advice.