The much-awaited law pertaining to 100% ownership for foreign nationals while starting a business in UAE mainland has been approved by His Highness Sheikh Khalifa bin Zayed Al Nahyan. The law will come into effect from December 1st of 2020.
Foreign investors do not have complete ownership of business on UAE mainland as of now and requires an Emirati sponsor to start a business The UAE Cabinet issued Cabinet Resolution No. 16 of 2020 containing the complete FDI Positive List and the requirements for starting companies on UAE mainland in the beginning of this year. His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai said that, “the UAE enjoys a fertile legislative environment now for foreign direct investment and looks forward to enhance the nation’s competitiveness.”
The new law amends 51 articles of the Commercial Companies Law (CCL) and added several new, most of it aiming on the regulations for companies with limited liability shareholding.
As per the existing CCL, foreign investors were only allowed to have a maximum of 49% of share in a limited liability company (LLC) that functions as an onshore UAE business. The remaining 51% was to be owned by an Emirati individual or a company owned by an Emirati as their local sponsor. The new law grants permission for foreign shareholders to have complete ownership without the presence of a sponsor. This will not be applicable to companies owned by the federal or local government or their subsidiaries, or for those excluded by the Cabinet decisions.
UAE is reaching out to investors all across the globe with its new and improved laws. The country is aiming to be the most suitable place for investments and is all set to welcome the new business owners to the world of opportunities.
HLB HAMT’s Consultants closely interact with clients to help setup business on UAE mainland, from the initial to final phase and also assists them with strategic ideas. We provide assistance in;
- Getting approvals and clearances from various departments,
- Drafting Memorandum of Association and other necessary agreements
- Opening bank accounts
- Finding a proper office location
- Handling other documentation formalities
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