Setting Up A Business Under The New UAE FDI Rule | EEG
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3 Things You Should Know About The 100% Company Ownership in The UAE

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The UAE government has been involved in economic diversification for quite some time now. Without doubt, these regular rule updations have helped the country’s economy to grow stronger and move away from its dependence on oil wealth. Setting up a business in the UAE has become easy and hassle-free over the years due to the nation’s increasingly lenient Foreign Direct Investment (FDI) rules.

 

This has been especially true for the Emirate of Dubai, where over the years, more than 30 Free Zone has started operating. And with the new rule of 100% foreign ownership to 122 economic sectors, Dubai, as well as the whole of UAE, is aiming to bring bigger and better FDI opportunities to investors from across the globe.

 

Expanding Horizons

The earlier FDI law No.19 that was passed in the year 2018 spoke of the possibility of 100% foreign ownership for investors who are interested in setting up a business in the UAE mainland, forfeiting the long-lasting rule of 51%-49% foreign ownership included in the Companies Law. However, the last update still enforced a negative list of sectors which didn’t allow 100% ownership in more than, with the promise of a revised positive list.

 

The recent announcement from the Cabinet came out with a positive list of 122 economic activities across different sectors. These include the following 13 sectors:

  • Agriculture
  • Renewable energy
  • Food and hospitality services
  • Healthcare industry
  • Storage and transportation
  • Product manufacturing
  • Civil construction
  • IT and communication
  • Space technology
  • Scientific activities
  • Administration and support
  • Education
  • Art and entertainment industry

 

Things to look forward to

On enforcing the new law, the UAE government is looking forward to three key results. 

 

  • On a very positive note, the rule will help in developing the economic sectors in the positive list. Economic activities like hybrid power plants, solar panels and other green technologies will grow with the aid of overseas investment and talent.
  • As we have seen before, an FDI positive rule always attracts new foreign investors from across the globe who sees growth potential in the much sought after Middle Eastern market.
  • In essence, this move will also increase global competitiveness. While the law applies to all the Emirates, the local governments can decide the actual foreign ownership percentage, which can be up to 100% if need be.

 

In conclusion, the new foreign ownership rule will reaffirm the UAE’s global position as an emerging market for and a global hub for foreign investment. And along with it, the country is also looking forward to building positive commercial diplomacy with other nations. As for foreign investors interested in setting up a business in the UAE, this is the right time to go ahead with their investment plans.

 

Consult with our experts today for more information. Contact us at +9714 311 6547 or email at info@uae-eu.com.

 

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