100% foreign ownership in UAE LLC -Applicability

100% foreign ownership in UAE : As per the new commercial companies law that will come into effect from June 1, 2021, investors can have 100% ownership. UAE allows 100 ownership of the mainland company.

Moreover, the prevailing companies also can change their status to suits the new commercial companies’ law. The new laws will change the whole ownership program. The new law are going to be valid for commercial companies, especially for foreign investors.

Not all kinds of companies will qualify for one hundred percent foreign ownership and every Emirate will issue specific guidelines. At this stage we understand there’ll be minimum share capital requirements attached to one hundred pc foreign owned companies and within the recently published Abu Dhabi guidance we’ve seen minimum share capital requirements surely businesses as high as $4 million.

The same guidance also states that certain businesses are required to use a minimum of 5 sector specialists – technology businesses especially are subject to the present requirement including computing system and software designing. the principles are still ambiguous for a few activities like ecommerce or online marketplaces. So it might take a while before early stage companies in these sectors can cash in of the change in law until the wants are clarified.

Particularly from a setup perspective, high minimum share capital and specialist employee requirements create hurdles especially for early stage businesses – as albeit the high minimum share capital and hiring costs were affordable its cash burn rate could make the long-term operation unsustainable.

In line with the recent amendment of the Commercial Companies Law, Abu Dhabi Department of Economic Development (ADDED) has listed out 1,105 registered commercial and industrial activities open for 100% foreign ownership.

The list reflects “the keenness of the Abu Dhabi Government to draw in further foreign direct investments and to market an open and resilient competitive business environment,” Mohamed Ali Al Shorafa, Chairman of ADDED, highlighted. The list is out there on their official website, reflects

Owners of existing companies can adjust their status, provided they “comply with the regulations on activities or other applicable restrictions”.

Full List of activities available for foreign ownership: Click here

Related: UAE allows 100% foreign ownership

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