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Schedule 1: Interpretation



1. Rules of interpretation

(1) In the Law, a reference to:
(a) a statutory provision includes a reference to the statutory provision as amended or re-enacted from time to time;
(b) a Person includes a reference to a government, State, State agency, corporation, Body Corporate, association or partnership; and
(c) a calendar year shall mean a year of the Gregorian calendar.
(2) The headings in the Law shall not affect its interpretation.

2. Defined terms

In the Law, unless the context indicates otherwise, the defined terms listed below shall have the corresponding meanings:

Term Definition
Action includes counterclaim and set-off
Bearer security a Security which by its terms is payable to the bearer of the Security Certificate, and includes any Certificate which has been generally endorsed
Certificated security a Security whose existence is embodied in a physical certificate
Chairman the chairman of the Centre, established under Dubai Law No. 3 of 2002
Commodity contract a commodity Futures contract, an option on a commodity Futures contract, or a commodity option
Communication includes any form of communication, whether written, oral or electronic
Contract of sale includes an agreement to sell As well as a sale
Control has the meaning given to it in Article 23
Council the Governing Body of the Financial Services Regulatory Authority of DIFC established under the Regulatory Law No. I of 2003
Debt security a Security which is not a share under which the Issuer is required to pay the holder of the Security one or more sums of Money at a future time; a Security is a debt Security regardless of whether the obligation to pay is absolute or contingent, whether the amount which will be payable is known on the date of issue of the Security, or whether the date of payment is certain on the date of issue
Delivery voluntary transfer of possession from one Person to another and includes any act of separation by which Property becomes unconditionally appropriated to a contract
DIFC the Dubai International Financial Centre, established under Article 3(l) of Dubai Law No. 3 of 2002
Endorsement a signature that alone or accompanied by other words is made on a Security or on a separate document for the purpose of assigning, transferring, or redeeming, the Security or underlying Property or granting a power to assign, transfer, or redeem the Security or underlying property
Entitlement holder a Person identified in the records of a Securities intermediary as the Person having a Security entitlement against the Securities intermediary; if a Person acquires a Security entitlement by virtue of Article 31 (1) (b) or (c), that Person is the entitlement holder
Entitlement order a notification communicated to a Securities intermediary directing transfer or redemption of a financial asset to which the entitlement holder has a Security entitlement
Financial asset except as otherwise provided in Article 20 means (i) a Security or an interest in or right to a security; (ii) any obligation of a type usually dealt in or traded on financial markets or an interest in or right to such an obligation; or (iii) any other Property which is held by a Securities intermediary in a Securities account where the Securities intermediary has expressly agreed with the account holder that the Property is to be treated as a financial asset under this Law or an interest in or right to such property; as the context requires, the term means either the interest itself or the means by which a person's claim to it is evidenced, including a certificated or uncertificated Security, a Security Certificate, or a Security entitlement
Instruction which directs that the transfer of the Security be registered or that the Security be redeemed
[Investment vehicle security a share or similar equity interest issued by an entity that is regarded as an Security Investment vehicle [collective Investment scheme?] under the [Securities Law]; Investment vehicle Security does not include an insurance policy or endowment policy or annuity contract issued by an insurance company, nor does it include any contract by which an amount is payable which is calculated by reference to the value of an asset or portfolio of assets]
Law the Personal Property Law No. I of 2003
Law of Security the Law of Security No. I of 2003
Office-holder has the meaning set out in the Insolvency Law No. I of 2003
Property anything which is capable of being owned and transferred and as the context requires denotes either the Property itself or title to the property
Purchaser a Person who has acquired or is in the process of acquiring title (whether contingent or absolute) to any Property other than as a recipient of a gift or other voluntary transfer
Real property any right or interest in land
Registered form as applied to a certificated Security, means a form in which a transfer of the Security may be registered upon books maintained for that purpose by or on behalf of the issuer
Sale includes an agreement as well as a sale and delivery
Schedule a schedule to the Law
Securities account an account to which a financial asset is or may be credited in accordance with an agreement under which the Person maintaining the account undertakes to treat the Person for whom the account is maintained as entitled to exercise the rights that comprise the financial asset
Securities intermediary a Person who in the ordinary course of business transacts Securities or other financial assets
Security except as otherwise provided in Article 20, means an obligation of or interest in an Issuer or in Property which is represented by a Security Certificate in bearer or registered form, or the transfer of which may be registered upon books maintained for that purpose by or on behalf of the issuer; any Instrument which satisfies these criteria, is a medium for Investment and by its terms expressly provides that it is a Security governed by this Law is a Security for the purposes of this Law
Security certificate a Certificate representing a Security Security entitlement the rights of an entitlement holder with respect to a financial asset specified in Part 5
Share a Security which represents any interest in the capital of any enterprise which is characterised by the law of the place of incorporation or establishment of that enterprise as a share
Third party Property interest an interest in any Property which could be asserted adversely to the interest interest of a purchaser of that property; this includes both Property rights in existence at the time of purchase and Property rights which may arise, by operation of law or judicial decision
Tier 4 Legislation Regulations and Orders made by the Council
Transfer in respect of Property, a transfer of title to property
Transfer authority has the meaning given to it in Article 19
Transferee in respect of Property, a Person who seeks to have title to Property transferred to himself, and includes a buyer
Transferor in respect of Property, a Person who seeks to transfer title to that Property to another, whether or not he owns such Property at the time of the transfer, and includes a seller
Uncertificated security a Security that is not represented by a certificate

3. Good faith

A thing is deemed to be done in good faith within the meaning of this Law when it is in fact done honestly, whether it is done negligently or not.

4. Third party Property interests

(1) A Person has notice of a third party Property interest if he:
(a) has actual knowledge of the third party Property interest;
(b) is aware of facts sufficient to indicate that there is a significant probability that the third party Property interest exists and deliberately avoids enquiring into the existence of the third party Property interest; or
(c) the Person has a duty, imposed by statute or Regulation, to investigate whether a third party Property interest exists, and the investigation so required would establish the existence of the third party Property interest.
(2) Having knowledge that an asset or an interest therein is or has been transferred by a representative imposes no duty of inquiry into the rightfulness of a Transaction and is not notice of a third party Property interest. However, a Person who knows that a representative has transferred a financial asset or interest therein in a Transaction that is, or whose proceeds are being used, for the individual benefit of the representative or otherwise in breach of duty has notice of a third party Property interest.