UAE to Allow 100% Foreign Ownership of Onshore Companies from June

The prerequisite of having an Emirati shareholder or agent to found a company in the United Arab Emirates will be lifted on June 1st, 2021, enabling foreign investors and entrepreneurs to open and have full ownership of onshore companies, regardless of nationality. This is thanks to new amendments to the Commercial Companies Law No.2 of 2015—which previously stipulated that foreign shareholders were confined to owning a maximum of 49 per cent in a LLC operating as an onshore UAE business.

The UAE has created a broad scope of opportunities across a diverse array of sectors thanks to the UAE’s successful economic diversification efforts—making it an emerging market melting pot of sorts. The UAE is a compelling investor destination due to the country’s relative stability compared with other MENA frontier markets and its excellent economic prospect. The UAE’s firm enabling environment, featuring cutting-edge technological infrastructure and advanced innovation levels, is also fundamental to its investor attractiveness. The country ranked 15th globally in the Kearney 2021 Foreign Direct Investment (FDI) Confidence Index, up four spots from its 19th place ranking in 2021.

With there already being more than 3000 UAE-based, onshore startups and a total of 129 startup deals amounting to $579 million in funding, the new announcement will further cement the UAE as one of the major economic powerhouses in the region and globally.

Abdulla bin Touq Al Marri, Minister of Economy, commented "The amended Commercial Companies Law aims at boosting the country’s competitive edge and is a part of the UAE government efforts to facilitate doing business."

The amended law will raise the attractiveness of the investment environment and provide a business-friendly environment for future investment.