The DIFC Prescribed Company Regulations 2026 (“Regulations”) came into force on 24 July 2026, introducing a significantly broader and more compliance-focused framework for Prescribed Companies (“PC’s”) in the DIFC. The updated regime is intended to make PC’s more accessible as special purpose and holding vehicles while strengthening the regulatory oversight surrounding their administration and ongoing compliance.
Prescribed companies have long been used in the DIFC for investment holding, asset ownership, financing and other structuring arrangements. The regulations make the regime more accessible, but they also make clear that the flexibility of the PC’s comes with a corresponding expectation of proper governance and regulatory compliance.
For businesses that already have a PC, or are considering establishing one, the following developments are particularly relevant:
One of the most significant changes is the removal of the previous qualifying requirements for establishing a PC.
Under the previous framework, applicants generally had to satisfy specific eligibility criteria, including requirements relating to the applicant, ownership or control, GCC registrable assets or a defined Qualifying Purpose. The regulations remove these general eligibility gateways and open the PC regime to any applicant, subject to the requirements of the Regulations.
This represents a material expansion of the regime. The qualifying purpose concept has been removed, and with it the Aviation, Intellectual Property and Maritime Structure categories that featured in the 2024 Regulations. The regulations nevertheless continue to recognise two specialised structures, Crowdfunding Structures and Structured Financing, because specific exemptions apply to PCs carrying on business for those purposes.
A Corporate Service Provider (“CSP”)is a person registered with the Dubai Financial Services Authority (DFSA) as a Designated Non-Financial Business or Profession (DNFBP) that undertakes corporate services business in the DIFC. They assist companies with their corporate and administrative requirements, including matters relating to company incorporation and registration, corporate secretarial services, maintenance of corporate records, statutory filings and ongoing corporate compliance.
Earlier, the appointment of a CSP was not a general mandatory requirement applicable to every PC. Rather, CSPs were contemplated in specific circumstances, including where the Registrar had an arrangement with a CSP to undertake certain assessments, checks and verifications in connection with the incorporation or continuation of a PC. A PC was also prermitted to use the registered office of a CSP appointed for that purpose. In addition, having a director who was an employee of a CSP with the requisite arrangement with the Registrar was one of the qualifying routes for establishing a PC.
Now, the 2026 regulations introduce a significant change by making the appointment of a CSP a general requirement for non-Exempt PC’s. An applicant seeking to incorporate or continue a PC must appoint a CSP to act on its behalf for the purposes specified in the Regulations.
An existing PC incorporated before 24 July 2026 that is not an Exempt PC must appoint a CSP within six months from the date on which the regulations came into force. Accordingly, the deadline for such PCs is 24 January 2027, unless the registrar approves a longer period upon application.
The regulations go beyond simply requiring the appointment of a CSP and set out specific statutory duties for the appointed CSP.
A CSP acting for a non-Exempt PC is required, among other things, to:
The CSP is also authorised to represent the PC in its dealings with the Registrar. The Registrar may therefore communicate directly with the CSP without having to communicate directly with the PC, except in relation to matters that the PC is required to undertake itself, such as certain strike-off or winding-up filings.
The regulations also establish clear obligations where a CSP ceases to act. Where the CSP resigns, is dismissed or otherwise ceases to provide its services, it must notify the registrar within 10 days of the cessation. The notification must include the cessation date and, where applicable, details of the replacement CSP or a statement that the PC no longer has prescribed company status. A CSP must also retain the books and records of the PC that it maintained during its appointment for six years from the cessation date
The regulations retain the requirement for PCs to maintain accounting records and prepare accounts in accordance with the DIFC Companies Law. However, the basis for certain exemptions has been updated to reflect the removal of the previous Qualifying Purpose framework.
A PC carrying on business for the purpose of a structured financing is exempt from the requirement to file its accounts with the Registrar and from the requirement to have those accounts audited.
Similarly, a PC carrying on business for the purpose of a Crowdfunding Structure, with annual turnover not exceeding USD 5 million on a consolidated basis and with more than 20 shareholders, is exempt from certain requirements relating to the preparation and filing of audited accounts.
The regulations also amend the content of the confirmation statement. Rather than confirming that the PC continues to satisfy the former qualifying requirements, the confirmation statement must now confirm whether the PC is an exempt PC or not, while continuing to comply with the applicable corporate, governance, compliance and regulatory requirements
The regulations also strengthen the registrar's ability to monitor compliance through the CSP.
The registrar, or an Inspector appointed by the registrar, may require a CSP acting for a PC, or a former CSP with continuing obligations in respect of the PC, to provide information, documents or access to premises where the registrar reasonably considers this necessary to ensure compliance with the regulations or the relevant laws. These powers are in addition to the registrar’s existing powers under the operating law and other legislation he administers.
The registrar may also notify the DFSA of matters that may constitute a breach of the CSP's obligations under the DFSA rules and may refer suspected criminal conduct to law enforcement authorities.
The regulations introduce administrative fines for certain failures as follows:
The DIFC Prescribed Company Regulations 2026 represent a significant shift in the way PCs are structured and administered. The removal of the previous eligibility requirements makes the regime considerably more accessible, while the introduction of the exempt PC category and the formalisation of the CSP's role create a more structured compliance framework.
For businesses, the key consideration is therefore not only whether a PC can now be established more easily, but also whether the company's ownership, registered office, governance and ongoing compliance arrangements are aligned with the new regulations.
Note: This legal update / newsletter is intended for general informational purposes only and should not be construed as legal advice. It is based on laws and legal interpretations in effect as of the date of publication. Laws and regulations may change over time, and their application can vary depending on individual circumstances. Readers are strongly encouraged to seek specific legal counsel before acting on any of the information provided herein.
Prescribed companies have long been used in the DIFC for investment holding, asset ownership, financing and other structuring arrangements. The regulations make the regime more accessible, but they also make clear that the flexibility of the PC’s comes with a corresponding expectation of proper governance and regulatory compliance.
For businesses that already have a PC, or are considering establishing one, the following developments are particularly relevant:
1. Wider access to the prescribed company regime
One of the most significant changes is the removal of the previous qualifying requirements for establishing a PC.Under the previous framework, applicants generally had to satisfy specific eligibility criteria, including requirements relating to the applicant, ownership or control, GCC registrable assets or a defined Qualifying Purpose. The regulations remove these general eligibility gateways and open the PC regime to any applicant, subject to the requirements of the Regulations.
This represents a material expansion of the regime. The qualifying purpose concept has been removed, and with it the Aviation, Intellectual Property and Maritime Structure categories that featured in the 2024 Regulations. The regulations nevertheless continue to recognise two specialised structures, Crowdfunding Structures and Structured Financing, because specific exemptions apply to PCs carrying on business for those purposes.
2. The corporate service provider requirement
A Corporate Service Provider (“CSP”)is a person registered with the Dubai Financial Services Authority (DFSA) as a Designated Non-Financial Business or Profession (DNFBP) that undertakes corporate services business in the DIFC. They assist companies with their corporate and administrative requirements, including matters relating to company incorporation and registration, corporate secretarial services, maintenance of corporate records, statutory filings and ongoing corporate compliance.Earlier, the appointment of a CSP was not a general mandatory requirement applicable to every PC. Rather, CSPs were contemplated in specific circumstances, including where the Registrar had an arrangement with a CSP to undertake certain assessments, checks and verifications in connection with the incorporation or continuation of a PC. A PC was also prermitted to use the registered office of a CSP appointed for that purpose. In addition, having a director who was an employee of a CSP with the requisite arrangement with the Registrar was one of the qualifying routes for establishing a PC.
Now, the 2026 regulations introduce a significant change by making the appointment of a CSP a general requirement for non-Exempt PC’s. An applicant seeking to incorporate or continue a PC must appoint a CSP to act on its behalf for the purposes specified in the Regulations.
An existing PC incorporated before 24 July 2026 that is not an Exempt PC must appoint a CSP within six months from the date on which the regulations came into force. Accordingly, the deadline for such PCs is 24 January 2027, unless the registrar approves a longer period upon application.
3. The role and responsibilities of the CSP
The regulations go beyond simply requiring the appointment of a CSP and set out specific statutory duties for the appointed CSP.A CSP acting for a non-Exempt PC is required, among other things, to:
- lodge documents, forms and fees required for the incorporation or continuation of the PC;
- make filings and provide documents, forms and notices that the PC is required to submit to the Registrar; and
- maintain copies of the records that the PC is required to keep under the applicable laws, ensuring that those copies are kept up to date and readily accessible where required. DIFC
The CSP is also authorised to represent the PC in its dealings with the Registrar. The Registrar may therefore communicate directly with the CSP without having to communicate directly with the PC, except in relation to matters that the PC is required to undertake itself, such as certain strike-off or winding-up filings.
The regulations also establish clear obligations where a CSP ceases to act. Where the CSP resigns, is dismissed or otherwise ceases to provide its services, it must notify the registrar within 10 days of the cessation. The notification must include the cessation date and, where applicable, details of the replacement CSP or a statement that the PC no longer has prescribed company status. A CSP must also retain the books and records of the PC that it maintained during its appointment for six years from the cessation date
4. Changes to accounting and reporting requirements
The regulations retain the requirement for PCs to maintain accounting records and prepare accounts in accordance with the DIFC Companies Law. However, the basis for certain exemptions has been updated to reflect the removal of the previous Qualifying Purpose framework.A PC carrying on business for the purpose of a structured financing is exempt from the requirement to file its accounts with the Registrar and from the requirement to have those accounts audited.
Similarly, a PC carrying on business for the purpose of a Crowdfunding Structure, with annual turnover not exceeding USD 5 million on a consolidated basis and with more than 20 shareholders, is exempt from certain requirements relating to the preparation and filing of audited accounts.
The regulations also amend the content of the confirmation statement. Rather than confirming that the PC continues to satisfy the former qualifying requirements, the confirmation statement must now confirm whether the PC is an exempt PC or not, while continuing to comply with the applicable corporate, governance, compliance and regulatory requirements
5. Increased powers of the registrar
The regulations also strengthen the registrar's ability to monitor compliance through the CSP.The registrar, or an Inspector appointed by the registrar, may require a CSP acting for a PC, or a former CSP with continuing obligations in respect of the PC, to provide information, documents or access to premises where the registrar reasonably considers this necessary to ensure compliance with the regulations or the relevant laws. These powers are in addition to the registrar’s existing powers under the operating law and other legislation he administers.
The registrar may also notify the DFSA of matters that may constitute a breach of the CSP's obligations under the DFSA rules and may refer suspected criminal conduct to law enforcement authorities.
6. Stronger consequences for non-compliance
The regulations introduce administrative fines for certain failures as follows:
- Failure by a prescribed company to appoint a required CSP may result in a fine of up to USD 20,000.
- Failure to make required documents and information available to the CSP may result in a fine of up to USD 100,000.
- A CSP that fails to submit the required cessation notice within the prescribed period may also be subject to fine up to USD 2,000.
Conclusion
The DIFC Prescribed Company Regulations 2026 represent a significant shift in the way PCs are structured and administered. The removal of the previous eligibility requirements makes the regime considerably more accessible, while the introduction of the exempt PC category and the formalisation of the CSP's role create a more structured compliance framework.For businesses, the key consideration is therefore not only whether a PC can now be established more easily, but also whether the company's ownership, registered office, governance and ongoing compliance arrangements are aligned with the new regulations.
Note: This legal update / newsletter is intended for general informational purposes only and should not be construed as legal advice. It is based on laws and legal interpretations in effect as of the date of publication. Laws and regulations may change over time, and their application can vary depending on individual circumstances. Readers are strongly encouraged to seek specific legal counsel before acting on any of the information provided herein.