Dubai: In 2021, the UAE government amended its Commercial Companies Law and paved the way for full foreign ownership for expatriates in certain business sectors.
Since the introduction of the new law, economic departments in the UAE have allocated over 1,000 business activities in commercial and industrial sectors for foreigners.
If you want to know what these business activities are and where you can find them, here is all you need to know.
Can a foreigner own 100 per cent of a commercial company in the UAE?
While earlier, based on the Commercial Companies law of 2015, foreign shareholders were limited to owning a maximum of 49 per cent shares in a Limited Liability Company (LLC) operating as an onshore UAE business.
However, the UAE government amended the law in June last year by issuing Federal Law by Decree No. (26) of 2020 Amending Certain Provisions of Federal Law No. (2) of 2015 on Commercial Companies, and annulling the requirement for some commercial companies to have a major Emirati shareholder or agent, according to u.ae, the UAE's official information portal.
The companies that are excluded from this regulation are those that have government ownership or those that are operating in the strategic sector, like oil exploration and drilling or water desalination, or that conduct specific activities as determined by the executive regulations of the law.
What are the business activities that allow foreign ownership?
Apart from the specific activities listed within the law and its executive resolutions, there are thousands of business activities that allow foreigners to have full ownership of the company. To assist foreigners in easily setting up such companies, local economic departments in Dubai and Abu Dhabi have released the list of these activities that will help you narrow down on the exact type of business you can set up.
Abu Dhabi
According to the Abu Dhabi Department of Economic Development (ADDED), over 3,000 commercial and industrial activities have been registered for foreign individuals or companies. The Abu Dhabi Business Centre (ADBC) allows entrepreneurs to find these activities through its website – adbc.gov.ae. Here are the steps you need to follow:
1. Visit https://www.adbc.gov.ae/BussinessActivityInfo/BussinessActivity.aspx?culture=en
2. Click on ‘business category’ and select the activity that you are interested in. For example, ‘advertising and media services’.
3. Next, select a sub-category, for example, Advertising services.
4. Once you have selected the category and sub-category, you will be provided with a list of specific business activities that are allowed in that sector.
If, instead, you want to see the complete list of business activities that allow 100 per cent foreign ownership, you can visit the ADBC website – adbc.gov.ae, click on 'information services' from the menu bar on top of the screen and select foreign ownership activities.
Next, you will directed to a document by ADDED, which includes over 3,000 activities that are available to foreign investors and entrepreneurs in Abu Dhabi.
To find out how you can apply for a licence once you have selected your preferred business activity, you can visit the TAMM platform, which is the Abu Dhabi’s government services portal. Click here to learn how you can complete the process online for setting up your business in Abu Dhabi.
Dubai
Dubai Economy and Tourism (DET) has also released a list of over 1,000 business activities that allow full foreign ownership. These activities include general trade, contracting, jewellery and luxury watch trading.
The full list of activities open for 100 per cent foreign ownership can be viewed here: https://ded.ae/DED_Files/ded_other/Full_Foreign_Ownership_Activities.pdf.
How to find your business activity
DET’s online platform – ‘Invest in Dubai’, allows entrepreneurs to apply for trade licences and business activities online, without visiting government departments.
These are the industries within which you can operate a 100 per cent foreign owned business in Dubai:
- Agriculture
- Fishing
- Mining and Quarrying
- Accommodation and food service activities
- Manufacturing
- Contracting
- Trading and services
- Social and personal services
- Transport, storage and communication
- Extra-Territorial Org and Bodies
- Real Estate, Renting
- Education
- Health and Social Work
- Electricity, Gas and Water
- Construction
- Financial Intermediation
Once you sign in to the Invest in Dubai platform, which you can do through the UAE Pass, you will then be taken through a step-by-step process by which not only can you select the business activity of your choice but also set up the business and receive your trade licence. To know more, click here.
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