Ever since this ownership limitation was relaxed, there have been various new types of announcements introduced. The former was: There would be ten new districts where the government will give individuals the rights to full foreign ownership. Before this, great emphasis got placed on the former FDI rules of services, agriculture, and industrial sectors.
Earlier this month, the Ministry of the UAE Economy declared that they would enforce the alteration of the Commercial Companies Law from the 1 of June 2021, where they will provide full ownership to various onshore companies that practice business formation in the UAE. Amidst this effect, the Economic Development department of Abu Dhabi has also released a new list that indicates who will be available to the foreign ownership law.
Abu Dhabi DED – Foreign Investor 100% owned activity list June 2021
However, recently, there has been no additional information on the newest guidelines for company setup in Dubai who will get a full-on foreign ownership right. For example, the capital requirements bar gets set for the highest share paid, and there has also been no available list for Dubai either. However, we will inform you on this matter as soon as the guidelines are released.
Essential Elements from the Newly Released Laws:
Higher Shared Capitals and Restrictions.
For the time being, the government emphasized no immediate clearance. If those business setups in UAE who got the right to full-on foreign ownership will get forced to give out a high capital share or additional fees will get enforced on the newly owned companies compared to the already existing 51%:49% LLCS. As the early Laws of Foreign Direct Investment (FDI) clearly emphasized extra charges by the increasing level of per share capital payments, some company setups in Dubai had the minimum per share capital from around AED 2 million and raised to 100 million. The reason for this high-end per share capital was that many industries that required workforce, property investments, or even production mainly needed large and hefty sums of per paid capitals.
What Kind of Business Setup in Dubai will get full-on Ownership?
The companies that will emphasize taking strategic paths to continue their business activities will not be made available to full-on ownership and will face various restrictions. There is expectance of a list of activities indicating all activities which will get restricted and the ones that will be made available to a full-ownership rule. However, the ones who can change these decisions and set the bar for various company setups in Dubai and cities mainly depend on the UAE nationals of companies to the governments of individual Emirates. It means that we are to expect different rules set for cities of UAE, such as Abu Dhabi, Dubai, and other similar, more expansive cities.
Total Allowance to move from Mainland to Freezone and Vice Versa.
The new law of full-on foreign business ownership also indicates that various businesses that have operated in the Freezone area of UAE but have also performed business activities in the mainland of UAE get the right to move to wherever they wish to go. Whenever they are given the right to a full 100% ownership, it has been made practical. Businesses that tend to operate in the mainland area of UAE can perform much better due to the wide variety of space and the allowance of staff and their visa application. It makes the staff members work in the UAE without facing any hindrances, which also allows the company formation in UAE to operate fully and allows the government to score an ICV much higher for the processes of government working fully.
Complete Removal of the NSA for Foreign Branches of Companies
The newly created law also indicated that there would be no need for a foreign branch office to choose a UAE (NSA) National Service Agent, which will come into use from the 30 of March 2021. However, today, there is no actual plan to do this the right way, and the foreign company branch is still in need of an NSA officer for their office. The reason for this is that the company setup in Dubai has to continuously renew its licenses and other documentation with the Economics department and the Department of Economic Ministry. It will get updated, and each Emirate department of Economic and Ministry importance will take this factor into effect to further adjust their NSA. However, this NSA adjustment will still require a notarized transfer document for all of their transfer processes. It will come into effect for both the clients and company formation in UAE as well.
More Official Government Requirements
Due to this newly released law, every company, including the companies that have limited access to activities in the UAE, will be introduced to many official government guidelines, which are to be submitted by the government at an upcoming date.
The general meetings and also certified process which will get held will have changes including:
- The meetings held in the future using advanced technology.
- The notice period of a meeting will get increased to 21 days.
- If individuals have a noticeable 10% share of a company’s capital, then they are liable to call a meeting to discuss further details.
Total On-Foreign Ownership Time Allowance.
The new law also indicates that the business setups in Dubai were asked to provide adjustments to their positions by the 2 of January 2022. It gets set after one year of the forced entry of the new law, which took effect on the 2 of January 2021. This law will make the LLCS change their view on the Association of Memorandums to bring relevant changes. For example, the notice periods and the guidelines and restrictions set for the new law enforcement meetings get held.
This information also indicates some expectance of something more sensible on the 1 of June 2021. It does because there will be the expectance of a restricted list or the other list of positive guidelines. Currently, no list has gets generated. The law bar set will allow companies to fully own their foreign businesses and take some time to take effect fully. The apparent removal of NSA will also require a great time to take effect, allowing various Federal departments of Labor, Economic, Immigration Etc. and the entire state of Emirates.
Journey to Full-On Foreign Company Ownership: What Steps Should the Company Setup in Dubai take now?
What should the companies who are aiming to own their companies entirely do now? The most professional advice that can get provided emphasizes that those already existing in the UAE and are seeking to hold it fully should contact their local arrangement agent and ask for the information if they get cleared to own their foreign business fully.
The full-on ownership will make the shareholders who pertain a 50% to 55% ownership of the shares take part in all of the notaries and take part in an agreement of share transfers for the change to take effect. The LLC will have to have a formal conversation with their agents to agree with their shareholders.
Moreover, business setups in UAE looking to form new LLC or new branches into areas of UAE get advised to be in a queue list until more information gets provided on the occurrence. They are morally advised not to wait for the event to get fully cleared as the law of fully owning a foreign business will take a great time to take effect and get appropriately shared with all of the departments of corporate governance in the UAE.
However, company owners get advised to contact a local partner to ensure that the company setup in Dubai can make clear shares and 50% to 55% of the shares or even if it wishes to progress to full-on ownership.
Other than this, the Partner Group (PRO) department has also declared that a platform is built, which indicates that companies fully own their business setups in Dubai without hindrances.
Journey to Full-Own Company Ownership, Essential Points:
- The Global-Link Corporate Service Provider, business setup consultants in Dubai, holds a platform for the UAE National Shareholders to either hold on to a 51% share as a local partner or act as the NSA for Foreign branches.
- When the law takes into action, companies can fully own their businesses. The clients can easily rebuy all of their previous shares at a swift and average value, and the Global-Link Corporate Service Provider company formation consultants in Dubai will assist in the matters of the Trading license, Immigration, and the MOL files.
- The Global-Link Corporate Service Provider; the best pro services in Dubai Structure will emphasize a fixed payable fee, allowing for a 60-day exit/sale/transfer strategy. For any reason, the client can partake in various bill transfers of shares or the National Service Association. It also indicates that the client can fully transfer the shares to their other clients without any difficulties, and they are also fully buy back the shares without any penalty. Which also ensures that claims will get repurchased at a considerable value to the clients.
- The Global-Link Corporate Service Provider structure will share total fees under the transfer of all the shares to confirm that the transfers are conducted efficiently, even for the settlement and the rebate processes.
- The Global-Link business setup services in Dubai also can appoint on the PRO if any assistance is required to help the staff with their pro visa service Dubai, family visas, company formal and informal settlements, cost of setting up a business in Dubai, and other Legal Services.
- Global-Link, best business setup consultants in Dubai will provide additional details with the legal documentation procedures when the company aims to fully own their company and provide other information such as a right to vote, POA for all of the back shares, and a trust agreement for the company LLC processes.