Everything You Need to Know on Full Foreign Business Ownership in Dubai

Following the announcement of Federal Decree-Law No. (26) of 2020 that permits full foreign ownership of onshore companies in the UAE, Dubai Economy has issued guidelines to clarify the procedures and started allowing foreign investors, who are seeking full ownership, to complete the procedures as required through the service channels of Dubai Economy or the ‘Invest in Dubai’ digital platform.

The new regulation amended some provisions of Federal Law No. (2) of 2015 and granted foreign investors 100% ownership of their business for the first time in the history of the UAE. This strategic decision enhances the investment attractiveness of the UAE while reinforcing the competitive advantages of Dubai as an ideal investment destination, Dubai Economy stated.

After bringing the Commercial Companies Law into effect on June 1^st, 59 investors have already started their business journey benefiting from this decision which grants 100% ownership for the foreign business owners in more than 1,000 commercial and industrial activities with no additional fees, guarantees, capital limitations or even the Emirati agent requirement.

As per the Dubai Economy guidelines, the 100% foreign ownership is available for more than 1,000 commercial and industrial activities and excludes 7 economic activities with strategic impact. The applicable activities vary from general trade, contracting, jewelry, luxury watches, foods, cars, and trucks trading within the commercial activities, to metals, construction, flooring, building materials, food, water production, and paint sectors in the industrial field. Kindergartens, elementary and middle schools, and hotels can also seek 100% foreign ownership. Explore the full list of activities here.

Dubai Economy assured that the status of current business licenses with full ownerships of activities and an Emirati partner remain unchanged as per the Memorandum of Association (MoA) and the partners’ agreement, yet the reduction of the Emirati partner share of 51% or withdrawal from the partnership is possible as per the implemented legal measures.

Also, the guidelines explained that full ownership does not require any change to current licensing procedures or conditions, except that it is no longer obligatory to have an Emirati partner or to allocate a fixed quota ratio for him/her.

Changing the legal form of a company is not possible, however, the license can be transferred to a one-person company with limited liability, according to DED guidelines. Also, full ownership does not apply to commercial agencies as they are regulated by the Commercial Agencies Law.

To get a license or amend a memorandum of association, you can log in to “Invest in Dubai” the unified digital platform offering competitive means to launch a business in Dubai. The platform provides a unique experience, enabling users to complete licensing procedures fast and smoothly and launch their business in a few minutes without the need to visit any service center.

Invest in Dubai platform can be used for initial approvals, trade name reservation, and issuance of instant licenses, Dubai SME licenses, Intelaq licenses, and DED Trader licenses in addition to license renewal. 

Source:

Dubai Economy