New companies law by year-end

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New companies law by year-end

The eagerly awaited Commercial Companies Law, considered critical to boosting investor confidence and developing the small and medium enterprise, or SME, sector, will be enacted before year-end, UAE Minister of Economy Sultan bin Saeed Al Mansouri said on Monday.

By Issac John

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Published: Tue 24 Sep 2013, 9:14 AM

Last updated: Tue 7 Apr 2015, 8:25 PM

The proposed law, which is expected to bring about several key reforms, was passed by the Federal National Council, or FNC, in May this year, and is waiting for the final clearance from the UAE Cabinet.

“From my part, the promise has been fulfilled,” the minister told Khaleej Times with reference to the final drafting of the 383-article law, which has been under discussions for more than 10 years, and was subjected to the longest debate in the history of the FNC.

The minister, speaking to reporters after his inaugural speech at the Fourth SME and Innovation Forum in Dubai, said the UAE economy was on a growth trajectory and is projected to record a growth of over four per cent this year. He said one of the main goals of the government is to boost the SME sector, which currently accounts for 60 per cent of the country’s gross domestic product.

He pointed out that the SME sector also hosts the majority of employment opportunities in the country and provides 86 per cent of all private sector employment. There are currently about 300,000 SMEs based in the UAE, with enterprises in this segment accounting for nearly 92 per cent of companies in the UAE.

Al Mansouri urged all strategic partners to take advantage of the agreements signed by the Ministry of Economy with the key entities in the area of SME development and innovation in order to enable citizens to embrace entrepreneurship and empower federal authorities and local stakeholders to adopt global best practices in the SME sector.

“The UAE is today the centre of growth and business in the region due to the establishment of world-class infrastructure and the country has been maintaining a positive growth environment for national and international companies. The UAE government has adopted the policy of creating a knowledge based economy which requires us to put in focused efforts in the development of small and medium enterprises,” Al Mansouri said.

He stressed that with the promulgation of the new SME law, all aspects of the law would be applicable in the SME sector, starting from the establishment of projects to the issuance of standardised definition by the Council of Ministers and the availability of incentives and facilities stipulated under the law.

The law, which is expected to ensure increased government support to SMEs, seeks to encourage and convince Emiratis to run SMEs, he said.

“This law is an important step forward in the efforts to encourage citizens to enter the private sector through enterprises of their own, enabling them to achieve success through creativity and innovation. It is now possible for them to benefit from the provisions of the law to ensure the success of their projects, right from training and qualification of entrepreneurship to finance, research and development and then promotion and marketing,” said the minister.

The SME forum included some interesting national and international sessions related to the promulgation of the SME law and prepare for its next stage, which is the implementation phase.

“At the national level, we have met with leaders and federal and local authorities on small and medium enterprises to study and discuss the implementation. At the global level, this year we have invited our partners from Canada, the Sustainable Development Technology Canada, the world leader in innovation and technology, as well as the MaRS Centre in Toronto, which is one of the best innovation centres worldwide,” Al Mansouri said.

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