Dubai Economy clarifies full ownership procedures for foreign investors

Dubai - A total of 59 investors in the emirate have already taken advantage of the new decision

Dubai Economy on Thursday issued guidelines clarifying the procedures for full ownership for foreign investors, which started from June 1 and is aimed at enhancing the investment attractiveness of the UAE.

Federal Decree-Law No. (26) of 2020, which amended some provisions of Federal Law No. (2) of 2015 regarding the ownership of commercial companies, will accelerate the UAE’s economic recovery and add to the gains the country has made so far.

It will also help further enhance Dubai’s already high rankings in international investment indicators and leading global indices related to ease of doing business and business expansion.

Investors seeking full ownership can complete the procedures required through the service channels of Dubai Economy or the Invest in Dubai digital platform. A total of 59 investors in Dubai have already taken advantage of the new decision.

The commercial activities in which full ownership was sought include general trade, contracting, jewellery, gold, pearls, luxury watches and foods, as well as cars and trucks trading. In the industrial category, sectors included metals and construction, flooring, building materials, foods, water production and paints sectors. A kindergarten, an elementary and middle school, and a hotel also sought 100 per cent ownership.

As per the guidelines published by Dubai Economy on its website, 100 per cent foreign ownership is available for more than 1,000 commercial and industrial activities excluding economic activities with a strategic impact, which are in seven sectors only. The full list of activities open for 100 per cent foreign ownership can be viewed on the site.

The status of existing business licences, where full ownership of the activities is available, and that include an Emirati partner, remains unchanged as per the memorandum of association and the partners’ decision. Dubai Economy clarified that a reduction of the percentage share of the Emirati partner from 51 per cent or his/her withdrawal from the partnership is possible according to the legal procedures followed.

Full ownership does not bring any change to current procedures or requirements for licensing, except that it’s no longer mandatory to have an Emirati partner or specify a fixed quota ratio for him/her. The guidelines also state that no additional fees, guarantees or capital required for full foreign ownership.

Dubai Economy also explained that though it’s not possible to convert the legal form of a company from an LLC (limited liability company) to a sole proprietorship under a foreign name as per the existing law, the licence can be transferred to a one-person company with limited liability. Full ownership does not apply to commercial agencies, as they are regulated by the Commercial Agencies Law. Branches of foreign companies do not require an Emirati agent.

To obtain a licence or amend the memorandum of association, investors can log in to Invest in Dubai, the unified digital platform that offers the most competitive means to launching a business in Dubai. It provides a unique experience, enabling customers to complete licensing procedures fast and smooth and launch their business within a few minutes and without having to visit any service centre. The platform can be used for initial approvals, trade name reservation, and issuance of instant licences, Dubai SME licences, Intelaq licences,and DED Trader licences in addition to licence renewal.

business@khaleejtimes.com