A DIFC Prescribed Company (PC) is the DIFC’s light-touch holding/SPV vehicle – a private company limited by shares under the Prescribed Company Regulations 2024 (in force 15 July 2024, replacing the 2019 regime), used to hold shares, assets, intellectual property, real estate or financing. The 2024 reform widened who can use it – adding a GCC-nexus route, a “GCC Registrable Asset” route and a worldwide-applicant route via a Corporate Service Provider. A PC carries reduced substance requirements, generally needs no DIFC premises or staff, and needs no DFSA authorisation unless it carries on a regulated activity. This page covers the legal substance – eligibility, constitution, duties and risk.
The Prescribed Company at a glance
- Vehicle – Private company limited by shares
- Governing rules – DIFC Prescribed Company Regulations 2024 (over the DIFC Companies Law, Law No. 5 of 2018)
- Typical use – Holding, SPV, structured financing, IP, real estate and GCC-registrable asset holding
- Eligibility – One of four routes: GCC/Registered-Person control; GCC Registrable Assets; a Qualifying Purpose; or any worldwide applicant via a CSP-director
- Substance – No employees; generally no own premises; administered by a Corporate Service Provider
- Regulation – None, unless it carries on a regulated activity (then the DFSA)
1. What a Prescribed Company is
A PC is a company incorporated under the DIFC Companies Law (DIFC Law No. 5 of 2018) and the Prescribed Company Regulations 2024 as a vehicle for passive holding and financing rather than active, regulated business. It has separate legal personality and limited liability like any DIFC company, but benefits from a lighter operational footprint – it is exempt from the usual DIFC requirement to maintain operations or a principal place of business in the Centre, and its registered office and administration are provided by a Corporate Service Provider (CSP). It is a low-cost holding and SPV vehicle inside the DIFC’s onshore, common-law framework.
2. The 2024 reform: what changed
The Prescribed Company Regulations 2024 came into force on 15 July 2024 and replaced the 2019 Regulations (and their 2020 and 2022 amendments). The headline change was to widen access: the PC was repositioned as a regional alternative to Cayman or BVI structures by opening it to GCC-nexus owners, to the holding of “GCC Registrable Assets,” and – importantly – to applicants anywhere in the world who appoint a CSP-provided director.
At the same time, two points are easy to get wrong and worth stating plainly: the discrete “Qualifying Purpose” list was narrowed (the old “DIFC holding structure” and “innovation holding structure” categories were removed), and the reform created a separate “Commercial Package” for entities that need employees or active operations – that package is not a Prescribed Company and does not share the PC’s exemptions.
3. Eligibility: the four routes
A PC must qualify on one of four bases under the 2024 Regulations:
| Route | Who qualifies |
|---|---|
| Control / nexus | Controlled by one or more GCC persons (or entities they control), by DIFC Registered Persons, or by Authorised Firms |
| GCC Registrable Assets | Established solely to hold or control GCC Registrable Assets – land/real estate, company shares, partnership interests, intellectual property, aircraft and maritime vessels |
| Qualifying Purpose | Established for one of the prescribed purposes (see below) |
| Worldwide applicant | Established by any person resident anywhere, provided it appoints a director who is an employee of a DFSA-registered Corporate Service Provider that has a compliance arrangement with the DIFC Registrar of Companies |
Each route turns on defined terms and conditions in the current Regulations, which should be checked against the specific facts.
The worldwide-applicant route is the genuinely new gateway – it lets an international family or business use a DIFC PC without any pre-existing DIFC or GCC connection, in exchange for the CSP carrying the compliance and AML burden. The precise definitions and nexus tests are detailed and have been revised more than once, so the current Regulations should be checked against the specific facts before relying on eligibility.
4. The Qualifying Purpose list
Where a PC qualifies by purpose rather than by control or asset, the 2024 Regulations limit the “Qualifying Purpose” to five categories (as at June 2026): aviation structures, crowdfunding structures, intellectual property structures, maritime structures, and structured financing. A PC on the GCC-Registrable-Asset or Qualifying-Purpose route is given a grace period (six months, extendable by the Registrar) to put the qualifying arrangements in place after incorporation. If the intended use does not fit one of these purposes, the PC will usually need to qualify on the control or asset route instead.
5. What a Prescribed Company can – and cannot – do
A PC is a holding vehicle. It may only conduct holding-company business unless it is set up for a Qualifying Purpose, and it may not have employees. It generally needs no premises of its own. If a structure genuinely needs staff, an office or active trading, the PC is the wrong tool – the DIFC’s separate Commercial Package (Active Enterprise) exists for that, and it carries different (heavier) requirements. Keeping the PC strictly within its holding remit is part of preserving its status and its exemptions.
Note – The DIFC’s Commercial Package (Active Enterprise) is a separate product from a Prescribed Company: it is the route for entities that need employees or active operations, and it does not share the PC’s exemptions.
6. What a Prescribed Company is used for
Common uses include holding shares in operating companies, holding intellectual property or real estate, ring-fencing assets, holding GCC-registrable assets (including aircraft and vessels), and acting as an SPV in structured finance and securitisation. A PC frequently sits beneath a DIFC Foundation in a family or wealth structure – the Foundation provides governance and succession at the top, the PC holds and ring-fences the underlying assets. See DIFC Foundations for the governance layer.
7. Constitution and governance
A PC is governed by its articles of association and the Companies Law, with directors who owe the usual statutory and fiduciary duties – to act within powers, in the company’s interests, with reasonable care and skill, and to avoid unauthorised conflicts. The CSP acts as registered agent, maintains the registered office and statutory registers and (on the worldwide-applicant route) provides the required director and discharges the agreed compliance and AML functions. Getting the constitution right at the outset – share rights, reserved matters, transfer restrictions – avoids disputes later.
8. Security, ring-fencing and financing
Because a PC is often an SPV, the legal mechanics of security and limited recourse matter: charges over the PC’s shares or assets, the registration of security under the DIFC Law of Security 2024, orphan or limited-recourse structures, and the insolvency-remoteness features lenders expect. ATB Legal drafts and reviews the constitution and the finance and security documents so that the ring-fencing actually holds when it is tested.
9. Maintaining qualifying status
Eligibility is not only an entry test. A PC must continue to meet its qualifying conditions, and a change in ownership, control or purpose can affect its status – as can a failure to complete the qualifying arrangements within the grace period. Because there are legal consequences if a PC ceases to qualify, the conditions should be monitored and any change managed deliberately rather than discovered after the fact.
10. Where the Prescribed Company sits among DIFC vehicles
The PC is the DIFC’s holding/SPV workhorse, broadly comparable to the ADGM SPV. For open-ended or multi-strategy investment, the DIFC’s newer Variable Capital Company may fit better; for succession and governance, a Foundation sits above the holding tier. The right vehicle depends on the legal purpose – which is the analysis we focus on.
The DIFC structuring practice
ATB Legal advises on the legal substance of a Prescribed Company: confirming eligibility against the current Regulations, drafting the constitution and shareholder arrangements, structuring security and limited-recourse financing, advising directors on their duties, and acting in disputes.
Frequently asked questions
What is a DIFC Prescribed Company used for?
It is a light-touch holding/SPV company used to hold shares, assets, intellectual property, real estate, aircraft or vessels, or to act as a financing SPV – often beneath a DIFC Foundation in a wealth structure. It is a passive holding vehicle, not an operating business.
Who can establish a Prescribed Company?
Under the 2024 Regulations, a PC qualifies on one of four routes: control by a GCC person, a DIFC Registered Person or an Authorised Firm; holding GCC Registrable Assets; a Qualifying Purpose; or – for any applicant worldwide – via a director provided by a DFSA-registered Corporate Service Provider. The current Regulations should be checked against the facts.
Does a Prescribed Company need DFSA authorisation?
No – not unless it carries on a regulated financial-services activity. A PC is a corporate holding/financing vehicle, not a financial-services firm; establishing one creates no exemption from DFSA regulation if a regulated activity is in fact carried on.
How is a Prescribed Company administered?
Through a Corporate Service Provider, which provides the registered office and registered agent, maintains the statutory registers and, on the worldwide-applicant route, provides the required director and handles compliance and AML. The PC generally needs no premises or staff of its own.
What changed in the 2024 Prescribed Company Regulations?
The 2024 Regulations (in force 15 July 2024) replaced the 2019 regime and widened access – adding a GCC-nexus route, a GCC Registrable Asset route and a worldwide-applicant route via a CSP. They also narrowed the discrete Qualifying Purpose list and created a separate Commercial Package for entities that need employees or active operations.
What is a “GCC Registrable Asset”?
It is a category of asset a PC may be established solely to hold or control – broadly land and real estate, company shares, partnership interests, intellectual property, aircraft and maritime vessels. Holding such an asset is one of the four qualifying routes.
Can a Prescribed Company have employees or its own office?
No. A PC may not have employees and generally needs no premises of its own – it is a holding vehicle exempt from the usual DIFC operating requirements. A structure that needs staff or active operations should use the DIFC’s separate Commercial Package, not a PC.
What is a “Qualifying Purpose”?
Where a PC qualifies by purpose, the 2024 Regulations limit this to five categories: aviation, crowdfunding, intellectual property, maritime and structured financing structures. A PC on this route has a grace period (six months, extendable) to put the qualifying arrangements in place.
Can a person outside the GCC or DIFC set up a Prescribed Company?
Yes. The 2024 Regulations added a worldwide-applicant route: a person resident anywhere can establish a PC provided it appoints a director who is an employee of a DFSA-registered Corporate Service Provider that has a compliance arrangement with the DIFC Registrar of Companies.
What happens if a Prescribed Company stops meeting the qualifying conditions?
Qualifying status is an ongoing requirement, so a change of ownership, control or purpose – or a failure to complete the qualifying arrangements within the grace period – can put the PC offside, with legal consequences for its status. The conditions should be monitored and any change managed deliberately.