Dr Omar Bin Sulaiman officially launches Family Office at DIFC

Speaking at the Middle East Families in Business Conference, Dr Omar Bin Sulaiman commented: "Seventy five per cent of the businesses in the region, which is estimated at US$ 500 billion, are family owned. These businesses dominate the national economy of the countries and constitute a significant force in the development of the region.

"However, being privately held, the family run business faces many challenges such as globalisation, the growing number of family members in each generation, growth of the company, succession plans and business continuity. It is well known that nearly 95 per cent of family businesses do not survive the third generation of ownership - primarily due to lack of planning in the succession.

"One of the key objectives of the DIFC is to make available the infrastructure which is ideally suited to provide wealth management services in the fullest sense. The Family Office will play a crucial role in the coming years. The DIFC has all the strategies in place to facilitate the Family Office. It is our aim to help preserve and grow family wealth for future generations. Family run businesses can look forward to the right organisation or individuals who will help them focus on issues such as anticipating the financial challenges ahead; identifying the right strategic advisors; supporting the development of a family "process"; serve as a communication conduit to keep family members informed; recognise and address family system dynamics that impede progress; and celebrate the success of the family through the transition. "

The Family Office will help protect the family's assets. Family businesses need appropriate legal structures for maintaining and transferring ownership of the assets. Some of the world's best known legal experts have established offices in the DIFC. They can assist families form family councils to agree family policy on succession planning and family "governance". Appropriate legal structures can go some way in protecting the family's wealth. Just as important, however, is the strategy which the family develops and implements for its own governance. The recently set up institute for corporate governance, Hawkama, will play a key role in helping to establish and tailor corporate governance codes for the individual family business.

Another important incentive for the Family Office is the DIFC Trust law which has been enacted specifically to enable the setting up of trusts. It is important to have in place a structure tailored such as a trust to achieve the individual specific objectives for the succession of the family wealth.

With the World Trade Organization (WTO) agreement looming large on the horizon, businesses need to be larger with a lot of capital, and one way of getting capital is to have a listed company where raising capital is easier than raising it through family members. Dubai International Financial Exchange is now well established as the ideal platform for raising of capital for business expansion. Restructuring, selling, introducing external capital into the family business and generating liquidity and diversifying risks can all be taken into account by a family office based in the DIFC. In short, the Family Office at the DIFC aims to play a key role in wealth management services in the coming years.