The UAE Government Decides to Grant Complete Foreign Ownership to Mainland Companies.
From June 1st 2021, the UAE government will be granting complete ownership to mainland companies. This news was announced by the UAE’s Ministry of Economy. This law will apply to all commercial companies in the UAE that are owned by foreign investors. This new change in the UAE mainland commercial company’s ownership constitution allows investors from around the world to perform business operations in Dubai without having to deal with the terms and conditions of local agents.
Previously, foreign firms were only allowed to get a 49 per cent share in their companies in the UAE. The other 51 per cent was mandated to be given to a citizen of the UAE or an Emirati-owned company except the company was established in one of the free zones in the UAE. This new development is remarkable as there are several foreign investors in the UAE. The new development is expected to boost the UAE business market. Abdulla Bin Touq Al Marri, UAE’s Minister of Economy mentioned that this amended law seeks to promote the country’s competitive edge. He also mentioned that the new development was a part of the government effort to expedite business operations.
Furthermore, the new law aims to open new gates for companies all over the world to take advantage of the growing potential of the UAE as a very feasible location for great business opportunities. The Minister of Economy describes the amendment as coming in line with the UAE’s broad vision to strengthen its status as a global business hub and to boost the confidence of entrepreneurs while supporting the economy of the major states of the UAE (Abu Dhabi/UAE).
The amended law will change the existing law and businessmen, entrepreneurs and foreign business investors will be able to obtain full ownership of their start-ups in the UAE. The Ministry of Economy intends to back this up by allowing foreign investors to solely control their companies without any interference from Emirati agents (shareholders) or local corporations. Existing and registered companies owned by foreign investors in the UAE are required to update their business license according to this latest amendment to the Commercial Companies Law.
The benefits of this new amendment may also extend to other spaces. Construction companies for example that had a rough year in 2020 can make up for their rough experiences due to the increase in the demand for office spaces that are bound to happen
The UAE business environment is evolving to get rid of issues that pose problems for local and international companies seeking to invest in the Dubai market. This 100% foreign ownership rule will ensure that international companies owners are able to perform their business operations in the UAE mainland zones by allowing them to get their full profits with no extra rules applied to their company formation.