In a latest development, the United Arab Emirates has allowed expatriate investors 100% ownership with effect from December 1, 2020, removing the need to have UAE nationals as sponsors. The decision comes after President His Highness Sheikh Khalifa Bin Zayed Al Nahyan issued an amendment to Law No. 2 of 2015 on companies and their shareholding. The full ownership by foreign nationals of companies licensed and registered in the UAE is allowed as per Cabinet Resolution No. 16 of 2020. In recent years, individual emirates allowed foreign national owned companies to acquire the remaining stakes on a case by case basis. The latest amendment thus extends the scope of that to a large extent, reported Gulf News.
The new law amended 51 articles and added new ones, primarily focusing on the regulation of provisions of establishing companies with limited liability shareholding. The amendments exempt expatriate investors from the minimum percentage ownership of UAE nationals. His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, announced the amendments to the law, noting that the UAE now enjoys a fertile legislative environment for the establishment of businesses in order to enhance the UAE’s competitiveness.
As per the Commercial Companies Law, Law No. 2 of 2015, foreign shareholders were limited to owning a maximum 49 per cent in a ‘limited liability company’ (LLC) operating as an onshore UAE business. This requires an Emirati individual or 100 per cent Emirati-owned company to hold the balance 51 per cent share as a local sponsor. The amended law allows natural and legal persons to establish companies without the need for a specific nationality. The law, however, will not apply to some companies that are excluded based on decisions by the Cabinet and those that are either wholly owned by federal or local governments or their subsidiaries.