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How to Establish a Non-Profit Organization in Dubai?
Non-profit organizations play a crucial role in enhancing social development, supporting community initiatives, and promoting volunteer work in the Emirate of Dubai. This sector is regulated byLaw No. (12) of 2017 regarding the regulation of non-profit organizations in the Emirate of Dubai, which outlines the conditions for establishment, licensing procedures, and oversight of these entities.
Our office team reviews in this article the key information you need to know if you are considering establishing a non-profit organization in Dubai.
First: What is meant by a non-profit organization?
The law defines a non-profit organization as either a non-profit association or a non-profit institution, both of which are entities that do not aim to make a profit and engage in activities of public benefit across various fields.
| Entity Type | Legal Nature |
|---|---|
| Non-Profit Association | Includes a number of founding members and is managed by an elected board of directors. |
| Non-Profit Institution | Established by the will of one or more founders and allocates assets for specific non-profit purposes. |
Second: Permissible Activities
The law permits non-profit organizations to engage in activities across various fields according to the regulations approved by the Community Development Authority in Dubai, including:
- Social and humanitarian activities.
- Health and educational activities.
- Cultural and scientific activities.
- Creative and artistic activities.
Third: Conditions for Establishing a Non-Profit Association
1. Number of Founders
The number of founders must not be less thanten members, with at least two members being citizens of the United Arab Emirates, although exceptions can be made by a decision from the General Director.
2. Age and Legal Capacity
Each founding member must be at least21 years oldand possess full legal capacity.
3. Good Conduct and Behavior
It is required that the founder has not been convicted of a felony or a crime that undermines honor or trust unless their status has been restored.
4. Articles of Association
An Articles of Association must be prepared that includes at least:
- The name of the association, its headquarters, and its objectives.
- Membership conditions and the mechanism for electing the board of directors.
- Financial resources and mechanisms for oversight.
- Dissolution and liquidation procedures.
Fourth: Licensing procedures
| Stage | Procedure |
|---|---|
| Submission | Submit the application to the Community Development Authority in Dubai along with all required documents. |
| Study | The authority studies the application and issues its decision within 30 days from the date of submission. |
| Extension | The study period may be extended once if necessary. |
| Acquisition of legal personality | After the issuance of the license and registration in the approved register and publication according to legal procedures. |
Once legal personality is acquired, the association has an independent financial liability and legal capacity.
Fifth: Key obligations after licensing
The law requires non-profit organizations to continuously adhere to several duties, the most important of which are:
- Compliance with the purposes of the license and not engaging in unauthorized activities.
- Not collecting or advertising donations without obtaining official approvals.
- Not interfering in political affairs in any form.
- Maintaining the required records and accounting books.
- Enabling the Community Development Authority to exercise oversight and inspection.
Sixth: Penalties for violating the law
In the event of any violation, the following administrative penalties may be imposed depending on the severity of the violation:
| Administrative penalty | Notes |
|---|---|
| Warning | In cases of minor violations for the first time. |
| Financial fine | Up to 100,000 dirhams and doubles upon repetition. |
| Suspension of activity | Temporarily until the violation is corrected. |
| Dissolution of the board of directors | In serious cases. |
| Cancellation of the license and closure of the establishment. | In the most serious cases of violation. |
Frequently Asked Questions
Can an association be established with the aim of making a profit?
No. The non-profit organizations stipulated by law are not intended to make a profit by nature, and any profit-making activity contradicts their legal nature and exposes them to administrative penalties.
Is it permissible for the association to collect donations directly after obtaining a license?
No. Collecting donations and advertising it requires obtaining independent official approvals from the relevant authorities, and it is not enough for the association to simply have a founding license.
What is the required number of founders?
At least ten members according to the general rule, including two members who are UAE nationals, with the possibility of exemption by a decision from the director general in certain cases.
Can foreigners participate in establishing the association?
Yes, foreigners are allowed to participate in the establishment according to the conditions and regulations specified in the law, including the requirement of having at least two Emirati members among the founders.
Who is the supervising authority for non-profit organizations in Dubai?
The Community Development Authority in Dubai is the competent authority for granting licenses and supervising and monitoring all non-profit organizations in the emirate.
Summary
- Non-profit organizations are non-profit entities licensed and supervised by the Community Development Authority in Dubai.
- The minimum number of founders is ten members, including at least two Emiratis.
- The articles of association are a crucial document that must be carefully prepared before submission.
- Collecting donations requires independent official approvals separate from the founding license.
- Violations may result in fines of up to 100,000 dirhams or cancellation of the license.
If you are planning to establish an association or non-profit organization or need advice on compliance with the legal requirements governing it in Dubai, our office team is fully prepared to provide the necessary assistance.