Abu Dhabi has recently issued a resolution outlining new rules for the establishment and licensing of endowment companies, announced by the Abu Dhabi Department of Economic Development (ADDED) in collaboration with the Endowments and Minors’ Funds Management Authority (Awqaf Abu Dhabi). This new framework aims to improve governance and accountability within the sector while encouraging sustainable development.
The resolution, which came into effect on February 17, 2025, provides clear guidelines for the creation and administration of endowment companies. It covers essential aspects such as the legal status of these entities, their permitted activities, and the necessary licensing requirements. The new framework builds upon existing laws related to family-owned endowments and introduces structured governance for such entities.
Under this new resolution, endowment companies will be able to manage private grants while engaging in commercial activities that support the growth and sustainability of endowed assets. These companies will focus on maximizing both financial returns and social impact. The framework also includes strong monitoring and supervisory mechanisms to enhance transparency and ensure accountability within the sector.
To ensure compliance with current regulations, all applications for endowment companies must be approved by Awqaf Abu Dhabi. This approval process will help align the companies’ operations with donor intentions and the broader goals of the grant. The resolution encompasses several types of endowment institutions, including private family-owned endowments, charitable endowments, and joint endowments.
In addition, the new resolution allows the management of endowed shares and equity stakes in commercial enterprises, provided these provisions are explicitly outlined in the companies’ articles of incorporation and comply with relevant laws. The government plans to issue further guidelines and manuals to ensure the highest standards of governance and transparency for all endowment institutions.
The resolution also aims to encourage investments in strategic areas such as manufacturing, education, healthcare, agriculture, culture, and innovation, promoting cooperation between the public and private sectors. The ultimate goal is to achieve sustainable development and efficient use of resources for the benefit of both founders and beneficiaries.
This move by the Abu Dhabi government signals a commitment to enhancing the endowment sector’s role in achieving long-term social and economic goals for the emirate.
For further updates, follow the official websites of the Abu Dhabi Department of Economic Development (ADDED) and the Endowments and Minors’ Funds Management Authority (Awqaf Abu Dhabi).
