Why choose us

United Arab Emirates consists of seven Emirates- Abu Dhabi, Dubai, Ajman, Fujairah, Sharjah, Ras al Khaimah, Umm al Quwain. It is a resourceful country and often attracts international investors to have business base in this country. UAE is widely known for its oil and natural gas reserves that acts as the pillars to strengthen its economy.

Economy

Economic growth and expansion of UAE has been a roller coaster ride, but it has managed to stand strong and has always been a consistent economy in the world. But 2020 has been challenging for the market stability of UAE. The pandemic has weakened the economy and has decreased the economy by 6.6% as per the report by International Monetary Fund. So, authorities have taken important steps to revive the business and economy conditions.

Business and laws

Various business laws are designed by the UAE government to meet the national and international standards and requirements effectively. Several rules are being implemented and upgraded in the past years for improving the economy.

The foreign investment laws are implemented to attract international investors and companies to easily expand its business in UAE. This law provides legal structures for registration, licensing; and guarantees the investors, protects their rights. These laws also regulate investments and tax exemptions.

The federal law is framed to govern and protect the shareholder rights, financial information and to improve the companies work efficiency and integrity.

The recent upgradation of the Company law in 2020:

In November 2020, the President of the United Arab Emirates, Sheikh Khalifa bin Zayed Al Nahyan passed an amendment stating approval for 100% foreign ownership of companies inside UAE and annulled the need of shareholdings in the Emirates as per previous laws. These laws were reported to have been effective from 1st December, 2020.

Previously, the companies who have an interest to establish their firm in UAE; need to have shares acquired by the UAE origins, as per the Government laws. But according to a recent news update by the official news agency of UAE (WAM), an amendment has been passed by the UAE Government. The new changes states that there is no need for foreign companies to have shareholders in UAE. They can establish their own company with a 100% self-ownership.

Other notable changes in law apart from 100 % foreign ownership includes-:

  • The companies can be sued by the shareholders in the civil court, if they fail to perform well or cause any kind of damage.
  • Putting an end to the requirement of majority shareholdings by the Emiratis for an onshore company.
  • Joint stock companies share increases from 30% to 70%.
  • The local authorities of UAE now have the power to grant approval to onshore company establishment, to determine the percentage of shareholdings and also to determine the monetary transactions. All these processes are governed by the Government of UAE.
  • Electronic voting has been granted to the general assembly meetings.

Conclusion

The above-mentioned laws can be beneficial for the investors in the present and future market. These changes would further attract investors from foreign countries to enter the business world of UAE.

 

 

© 2020 Gulf-lex. All rights reserved.
Privacy Policy | Disclaimer