Establishes the Ports, Customs and Free Zone Corporation as the public corporation supervising Dubai Customs and the free zone authorities, including JAFZA, approving their budgets and coordinating their activities; the Jafza Rules and Offshore Companies Regulations are issued by its Chairman under this law; in force on Gazette publication.
Law No. (1) of 2001 established the Ports, Customs and Free Zone Corporation (PCFC), the Dubai public corporation that sits above Dubai Customs, the Dubai Ports Authority and the Jebel Ali Free Zone Authority. It is the reason Jafza instruments, including the Jafza Rules and the offshore companies regulations, are issued under the signature of the PCFC Chairman. The Ruler of Dubai issued it on 1 April 2001 and, under Article 19, it came into force on the day of its publication in the Official Gazette. It remains in force; Law No. (12) of 2007, in force on issue on 3 June 2007, inserted Article 18 bis allowing the corporation to outsource its operations to operators.
Article 3 creates PCFC as a public corporation with legal personality and financial and administrative autonomy, able to sue and be sued and managed on a commercial basis. Article 4 affiliates to it the Customs Department, the Dubai Ports Authority and the Free Zone Authority and their subsidiaries. Article 5 sets its supervisory role: it supervises and audits the affiliates and coordinates among them, develops their work plans, prepares their draft budgets for the Ruler's approval, drafts their administrative and financial regulations for the Chairman's approval, may establish companies and hold shares with the Chairman's approval, may lend to or guarantee the affiliates, may borrow from banks, the Government or public financial institutions, and approves the affiliates' purchase contracts, tenders and projects. Article 6 allows PCFC to invest its assets in commercial, financial or services activities.
Article 7 defines PCFC's resources as government allocations, the net profits of the authorities and subsidiaries and other revenue, but keeps customs duties and other Customs Department revenue out of PCFC's hands: those go directly to the Government, which also pays Customs' salaries and expenses. Article 8 has the Chairman appointed by Ruler's decree, Article 9 puts the board under the Chairman's supervision and control, and Articles 10 and 11 have the Chairman appoint the board and the chief executive officer, who chairs the board, runs the corporation and represents it before third parties and the courts.
Article 13 makes PCFC property public property. Article 14 preserves the legal personality of Customs, the authorities and the subsidiaries, which continue under their own laws so far as consistent with this one, and allows each authority to convert to a commercial company form with the Chairman's approval. Article 16 exempts PCFC and its affiliates from all taxes, company registration fees and customs duties on operational imports, and Article 18 provides that the Government is not liable for PCFC's debts and PCFC is not liable for its subsidiaries' debts. The 2007 Article 18 bis lets PCFC outsource all or any of its own or its affiliates' operations to one or more operators and authorises the Chairman to sign the related contracts, with no liability for the operators' debts.
The Ports, Customs and Free Zone Corporation, its Chairman, board and chief executive; its affiliates, namely Dubai Customs, the Dubai Ports Authority and the Jebel Ali Free Zone Authority and their subsidiaries; and, through JAFZA, the companies licensed in Jebel Ali Free Zone whose rules and regulations are issued under the Chairman's authority.
| Article 3 | Establishes the Ports, Customs and Free Zone Corporation as a public corporation with legal personality and financial and administrative autonomy, able to sue and be sued and managed on a commercial basis. |
| Article 4 | Affiliates the Customs Department, the Dubai Ports Authority and the Jebel Ali Free Zone Authority, together with the companies they own, to the corporation. |
| Article 5 | The corporation supervises and audits its affiliates, develops their work plans, prepares their budgets for the Ruler's approval, drafts their administrative and financial regulations for the Chairman's approval, may establish companies, lend to or guarantee affiliates, borrow, and approves their contracts, tenders and projects. |
| Article 7 | The corporation's resources are government funds, the net profits of the authorities and subsidiaries and its own revenue; customs duties and other Customs Department revenue are excluded and paid directly to the Government, which bears Customs' salaries and expenses. |
| Article 9 | The board of directors manages the corporation under the supervision and control of the Chairman, who issues the regulation on the board's formation, tenure, meetings and resolutions. |
| Article 14 | Customs, the authorities and the subsidiaries keep their legal personality and operate under their own laws so far as consistent with this law; with the Chairman's approval an authority may convert to a commercial company form and the corporation may form a holding company. |
| Article 16 | The corporation and its affiliates are exempt from all taxes, company registration fees and customs duties on all imports required for their operations and objectives. |
| Article 18 | The Government is not liable for the debts or obligations of the corporation or its affiliates, and the corporation is not liable for the debts or obligations of its subsidiaries. |
| Article 18 bis | Inserted by Law No. (12) of 2007: the corporation may outsource all or any of its own or its affiliates' operations to one or more operators, assign, transfer, mortgage or dispose of assets for that purpose, and the Chairman signs the related documents; neither the corporation nor its affiliates are liable for the operators' debts. |
| Article 19 | The law is published in the Official Gazette and comes into force on the day of publication. |
This law does not bind our clients directly, but it explains the authority behind the documents they rely on. A Jafza onshore or offshore company's licence, lease, rulebook and registrar all trace to the Jebel Ali Free Zone Authority, which Article 4 places under the Ports, Customs and Free Zone Corporation and whose regulations the PCFC Chairman approves under Article 5. When we prepare a legal opinion, a bank KYC pack or a certificate of good standing narrative for a Jafza entity, we set out that chain: Law No. (1) of 1980 and Decree No. (1) of 1985 create the zone and its authority, this law puts the authority under PCFC, and the Jafza Rules and companies regulations are issued by the Chairman accordingly. The operator model in Article 18 bis is also why day-to-day registrar and licensing functions are carried out by Jafza's operating company rather than a government department.
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