The Riffle
The DIFC Authority has proposed a significant overhaul of the Prescribed Company (PC) regime, transforming it from a restricted-use vehicle into an open-access structuring option available to all applicants.
At the core of this reform is a shift from eligibility-based entry to a compliance-led framework, with Corporate Service Providers (CSPs) playing a central regulatory role.
Key Highlights
1. Universal Eligibility
Removal of all qualifying purpose, applicant, and nexus requirements
PCs can now be established by any applicant as passive holding vehicles
Aligns DIFC with global transparency standards such as OECD CRS and FATCA
2. Mandatory CSP Appointment
All PCs must appoint a DFSA-licensed CSP, unless classified as Exempt
CSPs act as the primary interface with the Registrar
Exempt PCs include those controlled by:
DIFC Registered Persons
DFSA-authorised firms
Government entities
Publicly listed entities
3. Expanded Role of CSPs
CSPs will have statutory responsibilities including:
Filing all documents and regulatory submissions
Maintaining records (minimum 6 years post-cessation)
Providing registered office for non-exempt PCs
4. Transition Requirement
Existing non-exempt PCs must appoint a CSP within 6 months
Failure may lead to status revocation and penalties
5. Enhanced Regulatory Transparency
Registrar empowered to collect financial data for statistical reporting to UAE authorities
Operational Framework for Prescribed Companies
Despite broader access, PCs remain specialised, passive vehicles:
Cannot employ individuals
Cannot provide financial services unless DFSA-authorised
Cannot act as fund managers, trustees, or GPs
No requirement for physical office space in DIFC
Must operate as passive holding structures only
Accounting & Audit Position
Structured Financing PCs: Exempt from audit and filing
Crowdfunding Structures: Exempt if turnover ≤ USD 5M and >20 shareholders
General PCs: Must maintain accounts as per Companies Law
Enforcement, Fees & Compliance
Proposed Fees
Incorporation: USD 100
Licence Grant/Renewal: USD 1,000
Confirmation Statement: USD 300
Key Penalties
Failure to appoint CSP: up to USD 20,000
Failure to provide information to CSP: up to USD 100,000
CSP non-compliance (e.g., cessation notice): up to USD 2,000
Why This Matters
This reform marks a structural shift in DIFC’s approach to SPVs and holding vehicles:
Access expands significantly – PCs move from niche structures to mainstream use
Compliance responsibility shifts – CSPs become central to governance and filings
Alignment with global standards strengthens DIFC’s positioning as a mature financial centre
Corporate tax environment integration reflects evolving UAE regulatory realities
What Firms Should Do Now
Assess existing PC structures for CSP requirements
Engage with DFSA-licensed CSPs early to ensure compliance readiness
Evaluate restructuring opportunities using PCs under the new open-access regime
Submit consultation feedback where relevant before the deadline
Consultation Timeline
Publication Date: 30 April 2026
Consultation Period: 30 days
Deadline for Comments: 2 June 2026
Next Step: Final regulations to be enacted post consultation
Conclusion
The proposed amendments signal DIFC’s evolution toward a more inclusive, compliance-driven ecosystem, where access is broadened but governance expectations are significantly strengthened.
For firms, this creates both new structuring opportunities and clear compliance obligations, particularly through the central role of Corporate Service Providers.
