What is UAE’s 100 Foreign Ownership Rule?

In November 2019, a new law was announced permitting up to 100% foreign ownership in UAE. The law, since in force, allows foreign ownership in “onshore” or mainland businesses. Traditional law allowed only 49% foreign ownership. 100% foreign ownership was only permitted in free zones or when setting up a professional services company. A milestone economic reform for the UAE, this law is expected to increase FDI in the UAE by 15-20%.

This is the best time to invest in the UAE

The UAE is rightfully seen as the gateway to international business opportunities and more so now. The country is known for its pro-business culture and conducive infrastructure for foreign investment. The country’s stable political climate also makes it extremely favourable for investments. Added benefits include zero corporate taxes on gained profits and complete exemption on income tax among others. Now, opportunities are endless with the new reform which will benefit UAE’s economy and foreign investors alike.

Why choose mainland over free zone foreign investment?

You may want to know how this is different from 100% investment in free zone areas. Free zone areas have certain restrictions when it comes to foreign investments. While the tax and customs benefits are still lucrative, these restrictions do complicate things for first-time entrepreneurs. Restrictions such as staff numbers and ownership of spaces are not present when you invest in mainland business setup.

Company formation in the UAE is now simpler for foreign entrepreneurs

The sectors directly benefiting from new law are renewable energy, artificial intelligence, technology and space. Under traditional law, foreign investors had to work closely with local sponsors for their mainland business. The new law removes this obligation altogether. So, if you are an entrepreneur looking to invest in the UAE, you have more autonomy now. You can directly focus on your company formation without worrying much. This could mean increased productivity and exploring added avenues to make profits.

Expert guidance to benefit from UAE’s new foreign ownership rule

Mainland business setup is preferred over free zone business set up due to various reasons. Just the increased access to the world market is a lucrative enough offer for many. The new law also does away with the few restrictions imposed on free zone businesses. It is, however, very important that you are guided by professional consultants if you are a first-time investor. These professionals will make the process seamless and hassle-free, helping you choose the best UAE destination for your business.

Choose the best assistance to help in your company formation in mainland Emirate. Take your business to new heights by making the most of the new foreign ownership law.