Matter note: a will and estate plan covering UAE

A will and estate plan that sits across two legal systems is not simply a drafting exercise. When one of those systems is the UAE, the sequencing, choice of law and the interaction with the family's other jurisdictions become the substance of the work. This matter note describes, in anonymised form, how we approached a cross-border estate plan for a principal whose asset map ran from the UAE to Hong Kong and several offshore centres.

A will and estate plan covering assets in the UAE requires a careful analysis of UAE succession law – including the interaction between Shari'a (the body of Islamic law that informs default succession rules for Muslim nationals in the UAE) and the civil-law framework that applies to expatriate testators – set against the law of each jurisdiction where the principal holds assets, including Hong Kong as a common-law hub. The governing instruments span UAE civil legislation, the Dubai International Financial Centre (DIFC) Wills and Probate Registry rules for non-Muslim expatriates, and the Trustee Ordinance (Cap. 29) in Hong Kong. The sequencing of documents, the choice-of-law elections and the substance of the holding structure are all load-bearing.

This note covers the situation, the cross-border constraint, the route we chose, the sequence of steps and the transferable lesson for principals with a similar asset map.

What was the situation, and why did it require cross-border counsel?

The principal was an Asian entrepreneur with a long-standing residence in Hong Kong, a portfolio of UAE property interests held partly in personal name and partly through a UAE-registered entity, and a family structure that spanned three generations across two continents. The family included members of different nationalities. That combination – mixed nationality, UAE-situated real assets, Hong Kong common-law domicile, and offshore holding layers – produced a succession problem that no single-jurisdiction drafter could answer.

The immediate concern was this: the principal had existing testamentary documents prepared years earlier under the law of a European jurisdiction. Those documents had not been reviewed since the family's centre of gravity shifted to Hong Kong and the UAE. They did not address the UAE assets at all. There was no DIFC will in place. There was no trust structure over the UAE property. In the event of the principal's death, the default position would have been fragmented and contested administration across at least three systems.

In our cross-border practice, we see this pattern with regularity. A principal builds a business, accumulates assets, and moves jurisdictions. The estate documents simply do not keep pace. The Hong Kong element adds a layer that many advisers outside Asia do not fully account for: Hong Kong has no forced-heirship regime, and the Trustee Ordinance (Cap. 29) – substantially reformed with effect from 1 December 2013 – gives a settlor significant latitude to reserve powers and to structure succession away from default inheritance rules. That latitude is useful. But it has to be used deliberately.

What was the specific cross-border constraint?

The core constraint was the intersection of UAE succession rules and Hong Kong's common-law position on testamentary freedom. The two systems do not conflict irreconcilably – but they do not harmonise automatically either.

For UAE-situated assets held in personal name by a non-Muslim expatriate, the UAE civil framework provides a mechanism by which the testator may elect for the law of their home country to apply. That election must be made through the correct registration vehicle. For expatriates in Dubai, the DIFC Wills and Probate Registry – a dedicated registry for non-Muslim testators established under DIFC legislation – provides a recognised route to register a will that covers Dubai-situated property and other specified categories of asset. A validly registered DIFC will directs the administration of the covered assets according to the testator's expressed wishes, rather than the UAE default rules.

The constraint was that the principal's UAE property sat in two places: some in personal name within the Dubai onshore jurisdiction, and some held through a UAE entity. The DIFC will mechanism addressed the personally held Dubai assets directly. The entity-level assets required a different layer of planning. There was also a question of the offshore holding structure: BVI and Cayman entities were in the picture, each carrying assets that needed to be mapped to the succession plan without triggering unintended tax or corporate-law consequences in the relevant offshore jurisdictions.

A further constraint was the Hong Kong dimension. The principal was not a Hong Kong permanent resident in the legal sense for all purposes, but the family office was operated from Hong Kong, a Hong Kong trust had been informally discussed, and the principal's overall affairs had a significant Hong Kong connection. Hong Kong succession law – which, like the law of other common-law systems, will generally apply the law of the deceased's domicile to movables and the law of the situs to immovables – required careful analysis to understand which documents governed which assets.

What did foreign counsel typically get wrong in situations like this? The most common error is treating the DIFC will as a complete solution. It is a powerful and well-designed instrument. But it covers a defined scope. Assets held through UAE entities, assets outside the DIFC geographic perimeter, and the articulation of the DIFC will with the broader succession plan require coordinated advice. A DIFC will drafted in isolation, without reference to the trust structure and the offshore holding layer, can produce gaps that surface only at the administration stage.

How did we structure the route, and what was the turning point?

The first step was mapping. Before any document was drafted, we prepared a full asset-and-jurisdiction map: every category of asset, the legal form in which it was held, the jurisdiction of that asset's situs, and the succession rule that would apply in the absence of deliberate planning. This map drove the document architecture.

The map revealed four distinct asset categories requiring separate treatment: (1) UAE real property held personally, addressed by the DIFC will; (2) the UAE-registered entity, which required a separate shareholders' agreement mechanism and, depending on the applicable UAE corporate rules, a specific form of testamentary disposition; (3) the BVI and Cayman holding entities, addressed through a Hong Kong-law trust structure under the Trustee Ordinance (Cap. 29), taking advantage of the 2013 reform's abolition of the rule against perpetuities and the strengthened firewall against foreign forced-heirship claims; and (4) liquid financial assets held in personal name in Hong Kong, addressed by a Hong Kong will.

The turning point came mid-process, during the review of the UAE entity documents. The existing corporate documents contained a provision that, on the death of a shareholder, effectively triggered a compulsory transfer mechanism under UAE law. This was not a succession document at all – it was a corporate governance clause. But in the absence of a specific testamentary instruction, it would have operated to transfer the deceased's interest in the entity on terms that were inconsistent with the principal's wishes. Identifying this clause, and preparing a coordinated corporate and testamentary response to it, was the moment that determined whether the estate plan would hold together.

We worked alongside UAE-admitted counsel on the entity-level documents and the DIFC will registration. On the Hong Kong side, we prepared the trust structure under the Trustee Ordinance and advised on the interaction between the Hong Kong will, the DIFC will and the trust. The BVI and Cayman holding entities were addressed through their respective corporate documents, with the trust as the holding vehicle above the offshore layer.

The sequence mattered. The trust was established before the DIFC will was registered, so that the DIFC will could correctly describe the beneficial interests the principal intended to preserve. The Hong Kong will was drafted last, to reflect the final structure and to avoid any risk of inadvertent revocation of the DIFC will by operation of law.

The sequence above describes the standard analytical position. Your matter turns on the documents, the jurisdictions actually engaged, and the order of steps – which is where the plan is won or lost. For a structured read of your asset map across the UAE and the relevant common-law jurisdictions, write to us at info@lockhartyip.com.

What was the outcome, and what does it transfer to similar matters?

The qualitative outcome was a documented estate plan that operated consistently across all four asset categories, with no gaps between the documents and no jurisdiction whose default rules could override the principal's expressed wishes. The DIFC will covered the personally held Dubai property. The trust held the offshore corporate layer and the Hong Kong-connected assets, with the statutory protections of the 2013 Trustee Ordinance reform applied to the choice-of-law and firewall provisions. The Hong Kong will addressed personal Hong Kong movables. The UAE entity documents were amended to remove the inconsistent corporate mechanism.

The plan was also living in a structural sense: the trust provided a vehicle through which future assets could be added, and the governance of the trust was documented to give the principal the level of retained involvement that was commercially appropriate, within the protections available under Hong Kong trust law.

What does this transfer to similar matters? Three practical points.

First, the UAE is not a monolithic jurisdiction for succession purposes. The DIFC, the Abu Dhabi Global Market and the UAE onshore civil system each operate distinct regimes. The nationality and religion of the testator, the form in which assets are held, and the geographic situs of those assets all determine which regime governs. Any estate plan touching the UAE must start with this classification exercise, not with the documents.

Second, corporate documents are succession documents. The death of a shareholder in an operating or holding entity triggers corporate mechanisms that may not be consistent with the testamentary plan. Reviewing shareholder agreements, articles of association and other corporate instruments as part of the estate-planning exercise is not optional; it is part of the map.

Third, Hong Kong trust law is a genuine planning tool for this kind of matter. The Trustee Ordinance (Cap. 29), as reformed, offers no forced-heirship exposure, a meaningful firewall against foreign claims, and the ability to structure settlor-reserved powers in a way that preserves the principal's practical involvement while providing the succession protections the trust is designed to deliver. For Asian-based principals with UAE and offshore exposure, a Hong Kong trust as the holding and succession vehicle above the asset layer is a well-tested route.

If an earlier plan, structure or set of documents produced gaps or an inconsistent result across jurisdictions, a fresh cross-border review can identify what is open and what the forward route looks like. Contact us at info@lockhartyip.com.

The objection handler: "my existing documents already cover the UAE"

The most persistent misconception we encounter in this area is the belief that a valid will drafted in one jurisdiction automatically governs all assets, wherever they sit. It does not. The law of the situs governs the succession to immovable property in almost every legal system, including the UAE. A European or common-law will may be valid in the jurisdiction of its making. It may be recognised in Hong Kong for Hong Kong-situated movables. But it will not override the UAE's succession rules for UAE-situated real property without a specific mechanism – in Dubai, the DIFC Wills and Probate Registry regime – to give it effect.

The secondary misconception is that holding UAE property through a corporate entity eliminates the succession problem. It shifts it. The shares in the corporate entity become the asset that passes on death, and the succession rules of the jurisdiction where those shares are situated (or, in some systems, where the company is incorporated) will apply to them. Unless the corporate documents are consistent with the testamentary plan, the entity adds a layer of complexity rather than resolving it.

Hong Kong's common-law tradition gives significant testamentary freedom, and the Trustee Ordinance's firewall provisions are a material planning tool. But that freedom has to be documented correctly, with the UAE layer addressed through the appropriate UAE mechanism, and the offshore corporate layer addressed through the trust and the corporate instruments simultaneously.

Our private wealth practice covers succession and asset-protection planning across Hong Kong, the UAE and the principal offshore centres. For related analysis, see our practice page at Private Wealth, our matter note on a will and estate plan covering assets in the Cayman Islands, and our guide to private trusts covering family assets in the United Kingdom.

Related practices

Private Wealth – succession, trust structures, asset protection and cross-border estate planning
Holding Structures – offshore and Hong Kong holding architecture for international principals

Frequently asked questions

What is the first step in a will and estate plan covering assets in the UAE?

The first step is an asset-and-jurisdiction map: every category of asset, the legal form in which it is held, and the succession rule that applies to it by default in the relevant UAE system. For non-Muslim expatriates with Dubai-situated property, the DIFC Wills and Probate Registry mechanism is typically the central instrument for personally held UAE assets. Corporate and offshore assets require separate treatment alongside the testamentary documents. This classification exercise determines the document architecture; drafting before it is complete produces gaps.

Which jurisdiction's law applies to a will and estate plan covering assets in the UAE?

UAE-situated immovable property is generally governed by UAE law, with the applicable sub-regime – onshore UAE civil law, DIFC, or ADGM – determined by the asset's situs. Non-Muslim expatriates with Dubai property can elect for their home-country law to apply through a registered DIFC will. Movable assets and shares in companies are typically governed by the law of domicile or the law of incorporation. A Hong Kong common-law domicile provides broad testamentary freedom over movables and a strong trust-law base for the offshore holding layer.

How long does a will and estate plan covering assets in the UAE usually take?

The timeline depends on the complexity of the asset map, the number of jurisdictions engaged, and whether corporate documents require amendment alongside the testamentary instruments. A plan of the kind described in this matter note – spanning the UAE, Hong Kong and offshore holding centres – typically requires several months from the initial map through to executed documents and registered instruments. The DIFC will registration process itself involves a defined registry procedure in Dubai; parties should verify the current timeline and requirements directly before proceeding.

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This publication is general information and does not constitute legal advice. For advice on your situation, contact info@lockhartyip.com.

Matter note: a will and estate plan covering assets in the UAE