All Are Welcome!
UAE Beckons Foreign Investors to Facilitate Transformation
Despite the difficulties brought on by the Covid-19 pandemic, November 2020 has been a transformational period for the UAE. In what appears to be an attempt to reshape the status quo and directly address obstacles and issues that have been debated to great lengths, the federal government has in the span of three weeks exhibited its commitment to change through several legislative reforms.
Viewed at a macrolevel, the UAE clearly recognises that current market conditions necessitate a pivot in policy in order to maintain its relevance as well as prepare for a post-pandemic economy that all emerging countries will need to quickly acclimate to. Furthermore, the legal changes are also a welcome assurance to the expatriate population.
The most important announcement is undoubtedly the changes to the ownership laws. After nearly two decades of back and forth discussions as well as the occasional rumour of drastic changes, we now have in place an assurance by the UAE government to drastically reduce the reliance on local sponsors by allowing 100 percent foreign ownership for onshore businesses.
While there is the caveat that this is not applicable to all industries, it is a welcome change that has been heralded by legal analysts and business leaders alike as a potential catalyst for foreign direct investment as well as increasing the competitiveness of the UAE. Indeed, the UAE, it could be argued, has faced increasing competition from within the region to adapt and adjust as Bahrain, Oman and Saudi Arabia, in particular, have drastically reformed their foreign ownership rules.