With more than 0.2 million migrants annually, Dubai attracts ex-pats from all over the world. Dubai lures a large number of people with a plethora of remarkable housing units, fewer taxes, and substantial income. Dubai also attracts well-educated professionals, particularly in the tech and trade sectors. 

Lofty buildings, chart-busting achievements, and ineludible grandeur makes Dubai one of the most enchanting places to invest in real estate. Dubai is ready for vast economic development in the years ahead, attracting international talent, considerable foreign investment, and much more astounding developments. 

The DED has released guidelines, that began in mid-2021, describing the process for foreign investors to procure 100% possession of commercial enterprises. 

The intent is to escalate the UAE’s appeal as a preferred country for business people, overseas investors, and talent and to fortify the country’s status as an international economic hub, and prompt investing money in major areas. 

Revised Guidelines For 100% Ownership

The DED has issued guidelines for 100% ownership for foreign investors in an attempt to elevate the UAE’s investment appeal. The country’s financial recovery will be hastened by Federal Law by Decree Number (26) of 2020. It revises a few segments of the Federal Law Number (2) of 2015, dealing with business ownership. This contributes to the city’s spectacular conduct in top international indices and global investment standards connected to the ease of trading as well. The decision will accelerate the country’s economic revival as well as build on UAE’s accomplishments to date. Up to 59 investors have already benefited from this new decision. The DED began implementing the new norm on 100% ownership from June 1, 2021. 

Existing regulatory frameworks or guidelines are not altered by 100% ownership, except that there is no more need for a UAE-based partner or stating a predetermined quota ratio for the partner. The guidelines also describe that 100% foreign ownership doesn’t need any extra capital, guarantees or fees. 

As per the website of DED, 100% ownership for foreign individuals is allowed for more than 1000 commercial & industrial activities other than the economic operations having a strategic impact, which is restricted to 7 sectors. 

Here are a few of the commercial activities for which 100% right of possession was sought out. 

• Traditional trade
• Jewellery business
• Luxury watches business
• Pearl business
• Gold business
• Contracting business 
• Vehicle business
• Truck business 
• Food business

Not to miss are hotels, kindergarten, that pursued 100% ownership.

Some of the industrial sectors that pursued full ownership include water production, metals & construction, building materials, and more. 

Many investors in the city already have gained from the latest policy letting them consolidate and wholly run onshore companies. 

On the other hand, the governing body of Sharjah declared that from June onwards they would be bringing into effect the 100% foreign rights to possession policy, letting investors of natural and legal persons possess commercial and industrial firms on the whole and carry out business in Sharjah.

This decision comprises no demands, namely a particular capital or extra expenses for foreign investors while letting outlets of foreign firms run their business in UAE with no need for a partner for a foreign firm. 

The minister of economy commented that the revised commercial agencies law intends at augmenting UAE’s competitive edge, and is a part of the Emirates authorities’ endeavors to ease running business. 

How It Impacts the Current Business License?

According to the company charter and the partners’ contract, the legitimacy of the present business licenses with 100% right of possession of a UAE-based partner and the operations stay unaffected. The percentage share of the UAE-based partner can be lowered from 51% or based on the lawsuit, the partnership can be canceled. 

The DED also described that it’s not feasible to modify a company’s legal structure from an LLC to individual entrepreneurship under a foreign name, below the current legislation. But, the license can be transferred to an OPC having limited liability. Since commercial companies are regulated by the Commercial companies law, they are not subject to 100% ownership. A UAE-based agent is not necessary for overseas agency branches. 

How to Procure a License?

Since Dubai has entrenched itself as a global and regional economic hub, a plethora of investors are attracted to the UAE to entrench companies and enterprises. Investors intrigued by 100% right of possession can complete the prerequisites via DED’s service channels or finance in Dubai’s digital platform that offers the best method of setting up commercial activity in Dubai. 

A unique experience awaits users on the portal, letting them complete prerequisites for licensing with ease and speed, letting them commence their business in a matter of few minutes with no need to show up at a service center. The portal consists of features namely primary authorization, company name booking, and license renewal. 

Despite the norms being easy to adhere to, it’s better to seek advice from Legal Firms in Dubai for the matter at hand to ensure there is no inconsistency. At GH International, we have a wealth of experience in the company formation process and creating all documentation required. Get in touch with us to get a better understanding of your requirements. 

What We Can Anticipate From Complete Foreign Ownership in the UAE

The decision goes a long way to develop the economic sectors. Eco-friendly undertakings, such as hybrid power plants, photo-voltaic (PV) modules, and other environmental technologies will flourish with the help of foreign investment and manpower. Moreover, a favorable Foreign Direct Investment rule will keep luring new foreign investors worldwide who see advancement prospective in the much-coveted Middle Eastern market. This decision will boost global competitiveness as well. Although the law is applicable for every Emirate, the real foreign ownership percentage can be determined by the local governments, and this can be as much as 100%. 

Final Thoughts 

United Arab Emirates’ move to ensure cent percent foreign ownership, on the whole, is being regarded as a turning point and an accomplishment. For a long period of time, this was the demand of greatest urgency from a variety of Corporate affiliations. As a service-oriented economy, and the biggest tourist spot in the globe, the country can certainly gain from luring more Foreign Direct Investment in diverse sectors, which is exactly what this change is intended at. 

A corporate reform such as 100% right to possession by foreign investors will improve their self-assurance while at the same time minimizing operational expenses, which is a vital business requirement. The latest regulation will let businesses register for business license registration and they can do so with no Emirati agent. As a result, the UAE will become a more appealing place to invest for MNCs, uplifting its competitiveness.

About GH International

GH International is one of the top Law Firms in Dubai with UK-qualified lawyers that offers the right combination of advice, service, and value. We have the extensive industry knowledge and are familiar with the regulations. We provide a comprehensive solution to the complete gamut of clients’ legal requirements. Reach out to us and set up a consultation with our team to discuss your business’s requirements, and learn how we can aid your business.