With global AML/CFT transparency standards, the implementation of CRS systems, and ultimate beneficial owner (UBO) registries, the concept of "absolute confidentiality" is a thing of the past. Today, creating a sustainable structure requires not data concealment but competent legal execution.

In the UAE, onshore foundations and family management foundations registered in leading financial hubs such as ADGM (Abu Dhabi) or DIFC (Dubai) have become a full-fledged alternative to traditional trusts.

Unlike offshore companies, an onshore foundation is a fully fledged legal entity with its own legal personality. It can own assets (real estate, shares) in its name, open accounts with virtually any bank in the UAE, and act as a party to transactions. At the same time, a balance is maintained: beneficiary information is disclosed to the regulator and banks but remains closed to the general public, ensuring a high level of privacy.

Onshore Fund Structure in the UAE

Onshore funds in the ADGM and DIFC have a clear and transparent structure for regulators, which includes:

• Founder – the person who donates property to the fund. From the moment of transfer, the assets are legally separated from the founder's personal property.
• Council Members – similar to a board of directors. They manage the fund's activities and ensure the achievement of its objectives (e.g., capital preservation).
• Beneficiaries – the individuals in whose interests the fund operates and who benefit from its assets.
• Guardian – the controller who ensures that the fund's council strictly adheres to the charter and the founder's will.
• Registrar – the financial center's government body that confirms the fund's legal status.

Advantages of an Onshore Foundation in the UAE

• Succession Planning: A foundation allows for asset transfer rules to be established outside of mandatory Shariah regulations (critical for expats and foreign investors).
• Asset Protection: Keeping the assets of the foundation segregated and separate from those of the founder, such that they are not subject to claims by third parties or future creditors.
• Tax Efficiency: Onshore foundations can obtain tax residency status in the UAE enjoying access to tax residency certificates and a 0% corporate income tax rate (subject to meeting qualifying income test)
• Timeless Ownership: The ADGM/DIFC foundations offer confidentiality until a court order is made, as compared to offshore islands that can only offer a few years of privacy before public scrutiny may reveal your ownership.
• Perpetuity: A foundation can last forever, like the business and capital they have built can continue for several generations of a family.

Opening an onshore fund in the ADGM or DIFC is a complex process that necessitates a sound understanding of local law as well as the drafting of compliance documentation and building good relationships with banking institutions.

Our team is skilled in the field of corporate consulting in the UAE and is prepared to offer you ready-made solutions for your project. We do not just register a legal entity — we create reliable instrument for preservation and succession of your capital according to the highest international standards.

• Checked / Updated: 05.17.2026
• Published on: 05.19.2016
• Author: Andrey Melnichuk