12 January 2021 - The UAE has commenced the new year by introducing a series of amendments to the key piece of legislation governing business activities in the UAE - Law 2 of 2015 Regarding Commercial Companies.
The amendments, projected to be a significant element in the liberalization of foreign ownership in the UAE, were published on 2 January, 2021 and will take effect on 2 July, 2021.
The amendments introduce a series of significant changes, most notably the elimination of:
- The requirement of minimum 51% Emirati ownership of capital in onshore companies;
- The ownership restrictions requiring for a majority of certain UAE companies’ directors to be UAE nationals.
However, some foreign ownership restrictions will remain for companies carrying out economic activities considered to be of “strategic impact”, the list of which is expected to be clarified by the Government within the 6 month transition period.
The amendments may also carry implications for UAE free zones, reduction of the number of the free zones is possible.