On 19 May 2021 the UAE Minister of Economy, His Excellency Abdulla Al Marri, announced that amendments to the Companies Law in respect of foreign ownership will be implemented from 1 June.
The amendments to the law allow foreign, non-UAE national, investors to wholly own companies ‘onshore’ in the UAE, unless a restriction exists and the company carries on what is called a ‘strategic impact’ activity.
There have been a number of interesting developments since the 19 May announcement:
Abu Dhabi
The Abu Dhabi Department of Economic Development has announced a list of licence activities which may be conducted by a company which is wholly owned by foreign investors in Abu Dhabi. There are over 1,100 licence activities included on the list from a range of sectors of the economy. Amongst other things, it was interesting to read that:
- the list contains an extensive range of manufacturing activities,
- building and other contracting activities are included in the list,
- repair, maintenance and installation activities feature across a range of fields,
- e-commerce is included,
- a range of rental and leasing activities are included,
- the list includes a number of marketing and events related activities,
- the licence activity of ‘onshore and offshore oil and gas fields and facilities services’ is included,
- hospitals are included in the list, and
- trading activities are not included in the list.
Dubai
The Dubai Department of Economic Development has issued an announcement stating that, amongst other things:
- there will be more than 1,000 commercial and industrial licence activities which it will be possible for a company which is wholly owned by foreign investors to carry on,
- ‘professional activities’ will be restricted from foreign ownership,
- no specific capital requirements will be imposed on companies which are wholly owned by foreign investors, and
- foreign companies operating through a branch office will not be required to appoint a UAE national agent.
Based on announcements from the Dubai Department of Economic Development, the list of ‘strategic impact’ activities in which foreign investment will not be permitted includes:
- security, defence and military activities,
- fisheries and associated services,
- certain financial institutions,
- printing banknotes,
- communications,
- Hajj and Umrah services, and
- centres for memorising the Holy Quran.
It's an interesting time to be advising on FDI and corporate structuring in the UAE...
“This announcement of the list of economic activities available for foreign ownership reflects the keenness of the Abu Dhabi Government to attract further foreign direct investments and to promote an open and resilient competitive business environment. The decision is one of many decisions and initiatives to provide incentives for the private sector in Abu Dhabi and to enhance the status of Abu Dhabi on the global investment map.” HE Mohamed Ali Al Shorafa, Chairman of ADDED
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