UAE eyes foreign ownership law by year-end
Dubai, March 9, 2010
The United Arab Emirates will review rules governing foreign ownership of companies in the next month and implement a new law by the end of this year, economy minister Sultan bin Saeed Al-Mansouri said on Tuesday.
"The law should be submitted to the cabinet within a month," he said on the sidelines of a conference. "Our expectation is that the law would come out by 2010."
Under current regulations, business owners from all nationalities except from within the six GCC states must have a local majority partner. Exceptions apply in free zones such as Jebel Ali Free Zone and Dubai Internet city, where 100 percent foreign ownership is allowed.
The new regulations have been in the pipeline for several years and are aimed at increasing foreign investment as restrictions on full ownership were considered a key reason for holding back investment and stifling competition.
The UAE, the world's third-largest oil exporter, has been striving to diversify its economy away from a dependence on energy exports by pouring windfall oil revenues into real estate, financial services and infrastructure.
Al-Mansouri said in September the law was in its final stages and would include a rule stipulating a minimum capital of 200-300 million dirham ($54-$82 million). The new law is in line with recommendations made by the World Trade Organisation (WTO).
Dubai has long sought to position itself as an international tourism and financial centre, luring businesses to its free zones with promises of tax-free earnings.
The global financial crisis put the brakes on a six-year oil-fuelled economic boom in the Gulf region with Dubai hit the hardest after its real estate sector crashed in 2009. - Reuters