RAK ICC Foundations, UAE Wealth Planning Structures

Overview

What is a RAK ICC Foundation?

The RAK ICC Foundation is a distinct legal vehicle governed by the RAK ICC Foundations Regulations 2019, a modern, purpose-built regulatory framework that has established the UAE as one of the world's leading jurisdictions for private foundation structures. Unlike a trust, which is a relationship between a trustee and beneficiaries, the Foundation is a legal person in its own right: it can own assets, enter contracts, sue and be sued, and continue to exist in perpetuity beyond the lifetime of its founder.

The Foundation is particularly well-suited to clients from civil law jurisdictions, including continental Europe, Latin America, the Gulf, and many parts of Asia, where the foundation concept is more familiar than the common law trust. The civil law tradition has long used foundations for wealth accumulation, family patrimony preservation, and charitable activity, and the RAK ICC Foundation provides an internationally credible UAE-based vehicle aligned with that tradition.

Governance of the Foundation is set out in its charter and by-laws, documents drafted at establishment that specify its purpose (private, charitable, or mixed), the composition and powers of its governing council, the identity and rights of its beneficiaries, and any reserved powers retained by the founder. The founder can retain meaningful control, for example, retaining the right to direct investments, veto council decisions, or add and remove beneficiaries, without those rights compromising the asset-separation effect of the Foundation.

Aurevya provides comprehensive Foundation structuring services, from initial purpose and governance design through charter and by-laws drafting, council appointment, RAK ICC registration, asset transfer planning, and ongoing governance support, with deep experience in cross-border estate and succession matters.

Full

Legal Personality, Assets in Own Name

Unlike a trust, the Foundation owns its assets directly in its own name, providing clear asset separation, creditor protection, and legal certainty.

Private

Beneficiary Register

The register of beneficiaries is held privately and is not publicly accessible, providing confidentiality for family members and beneficiaries of the Foundation.

2019

Regulatory Framework Established

The RAK ICC Foundations Regulations 2019 provide a modern, comprehensive legal foundation, benchmarked against leading international private foundation jurisdictions.

Key Features

Why Choose a RAK ICC Foundation?

The RAK ICC Foundation combines the legal certainty and asset-holding capacity of a corporate entity with the flexibility and succession-planning utility of a private foundation, creating a uniquely powerful wealth planning structure for internationally mobile families.

01

Full Legal Personality and Asset Ownership

The Foundation is a legal person that owns its assets directly, shares in companies, real estate, financial instruments, cash, and intellectual property. Assets transferred to a Foundation no longer form part of the founder's personal estate, providing clear legal separation from the founder's creditors and succession claims.

02

Private Beneficiary Register

The names of beneficiaries are not publicly disclosed. The register is maintained privately by RAK ICC and the Foundation's registered agent. This confidentiality is significant for high-net-worth families seeking to keep wealth distribution arrangements private, particularly in jurisdictions where public registers create unwanted exposure.

03

Flexible Governance Structure

The Foundation is governed by a council, a body equivalent to a board of directors or a trust committee. Council members, their powers, decision-making procedures, and succession are specified in the by-laws. The founder can retain reserved powers over investment decisions, council appointments, and beneficiary changes, maintaining practical control without compromising the Foundation's legal structure.

04

Charitable and Private Purpose Permitted

A RAK ICC Foundation can be established for private purposes (benefiting named individuals or a defined class), charitable purposes (educational, humanitarian, cultural), or a combination of both. The purpose is specified in the charter and can be broad or specific, providing maximum flexibility for diverse family and philanthropic objectives.

05

Asset Protection and Creditor Insulation

Assets properly settled into a Foundation are separated from the founder's personal estate. Subject to fraudulent conveyance provisions, Foundation assets are insulated from the founder's future creditors and are not subject to forced heirship claims from the founder's heirs under UAE federal succession law.

06

Multi-Generational Succession Certainty

The Foundation continues to exist perpetually beyond the founder's lifetime, distributing income or capital to beneficiaries across multiple generations in accordance with the by-laws. This provides succession certainty that is difficult to achieve through a will alone, particularly for international families with assets in multiple jurisdictions.

Process

How It Works

Establishing a RAK ICC Foundation is a carefully designed process combining legal structuring, governance drafting, and regulatory registration, with Aurevya coordinating each stage from initial design through to asset transfer and ongoing administration.

1

Purpose and Governance Design

We work with the founder to define the Foundation's purpose, private, charitable, or mixed, and design the governance framework: council composition, founder's reserved powers, beneficiary provisions, investment mandate, and distribution mechanics. This design stage is the most important step in the entire process.

2

Charter and By-Laws Drafting

The Foundation's constitutional documents, the charter (setting out name, purpose, and seat) and by-laws (setting out governance, distribution provisions, and reserved powers), are drafted in accordance with the RAK ICC Foundations Regulations 2019. We prepare bespoke documents tailored precisely to the founder's objectives rather than generic templates.

3

Council Appointment

The Foundation's council members are identified and appointed. Council members can be individuals or corporate entities, and can include the founder, family members, professional advisers, or a combination. Independent council members may be appointed where governance independence is required or desired by the founder.

4

RAK ICC Registration

The Foundation is registered with RAK ICC through a licensed registered agent. Registration requires the charter, by-laws, KYC for the founder and all council members, and payment of registration fees. RAK ICC issues the Certificate of Registration upon completion of its review, formally establishing the Foundation as a legal person.

5

Asset Transfer and Ongoing Governance

We advise on the appropriate mechanism for transferring assets into the Foundation, whether by way of gift, sale, or contribution, and coordinate any ancillary steps required (e.g., share transfer agreements, property conveyances, bank account opening). We also provide ongoing governance support including council meeting administration, annual renewal, and compliance monitoring.

Requirements

Requirements and Costs

Foundation Requirements

Minimum of one council member (individual or corporate)
Licensed registered agent required in RAK ICC
Charter must state the Foundation's name, purpose, seat, and initial assets
By-laws must set out governance, council powers, and beneficiary provisions
Compliance with RAK ICC Foundations Regulations 2019 and applicable AML/KYC obligations
Annual fees payable to RAK ICC and registered agent

Documentation Required

Certified passport copies for the founder and all council members
Proof of residential address for founder and council members
Source of funds and source of wealth declarations
Details of proposed beneficiaries (held on private register)
Description of assets to be settled into the Foundation
Corporate KYC for any corporate council members or beneficiaries

FAQ

Frequently Asked Questions

How is a RAK ICC Foundation different from a trust?

The fundamental distinction is legal personality. A trust is not a legal person, it is a relationship between a trustee (who holds legal title to assets) and beneficiaries (who have the equitable interest). A Foundation is a legal person in its own right: it holds assets in its own name, can enter contracts directly, and continues to exist independently of any individual. This makes the Foundation more familiar to clients from civil law traditions, and provides arguably clearer asset separation. Trusts are more flexible in certain common law respects; Foundations are preferred where the founder wants a structured governance body (the council) rather than delegating entirely to a trustee.

Can the founder also be a council member?

Yes. The RAK ICC Foundations Regulations 2019 permit the founder to serve on the council, and indeed the founder can retain significant powers over the Foundation's activities through both council membership and reserved powers specified in the by-laws. Founders commonly sit on the council while also retaining reserved powers to direct investment decisions, amend the by-laws with consent, or appoint and remove council members. However, care must be taken to ensure that the founder's retained powers do not compromise the asset-separation objectives of the Foundation for tax or legal purposes.

Is the Foundation taxed in the UAE?

RAK ICC Foundations are not subject to UAE corporate income tax at the Foundation level under the current framework. The UAE does not levy inheritance tax, gift tax, or wealth tax. Income generated by Foundation assets may be subject to tax in the jurisdictions where those assets are located or where income arises, for example, rental income from foreign real estate or dividends from operating companies in tax jurisdictions. Aurevya provides holistic structuring advice to ensure the overall structure achieves tax efficiency across all relevant jurisdictions.

Can a RAK ICC Foundation own property outside the UAE?

Yes. A RAK ICC Foundation can own assets located anywhere in the world, including real estate, listed securities, shares in operating companies, bank accounts, and other financial assets in any jurisdiction. The Foundation's ability to own foreign assets is one of its key strengths as a multi-jurisdictional holding vehicle. Whether foreign jurisdictions recognise the Foundation as the legal owner of assets located there will depend on local law, and Aurevya advises on jurisdiction-specific recognition and structuring considerations.

Who supervises UAE foundations?

RAK ICC Foundations are regulated and supervised by the Ras Al Khaimah International Corporate Centre (RAK ICC). RAK ICC is the registration authority and has oversight of Foundation compliance with the Foundations Regulations 2019. The Foundation's registered agent (licensed by RAK ICC) is responsible for maintaining the registered office, filing annual renewals, and ensuring compliance with AML/KYC obligations. The UAE's Financial Intelligence Unit and relevant UAE authorities have access to Foundation information for regulatory and law enforcement purposes.

What happens to the Foundation when the founder dies?

This is one of the Foundation's most important advantages. On the founder's death, the Foundation continues to exist as a legal person, entirely unaffected by the founder's death or by the probate process in any jurisdiction. The Foundation's assets do not form part of the founder's estate and are not subject to grant of probate. The council continues to govern the Foundation in accordance with the charter and by-laws. Distribution to beneficiaries occurs as specified in the by-laws, providing seamless, pre-planned succession without the delays, costs, and uncertainties of a multi-jurisdictional probate process.

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The UAE's Most Flexible Wealth Planning Vehicle