Dubai: The United Arab Emirates (UAE) allowed 100 percent foreign ownership of the firms in the country.
After the landmark reform that was approved by the President, His Highness Sheikh Khalifa bin Zayed Al Nahyan, foreigners will no longer need Emiratis as sponsors.
The new FDI regime will come into effect from 1st December 2020.
Expressing views over the reform, His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai said that it will enhance the nation’s competitiveness.
Under the existing Commercial Companies Law (CCL), foreigners are not allowed to own more than 49 percent of Limited Liability Company (LLC) and the rest of the share can be held by an Emirati individual or 100 percent Emirati-owned company.
To remove the restriction on the foreign investors, Article 51 of the CCL was amended and a new one was added.
It seems that the country is taking such reforms in order to improve its economy after the forecast made by the International Monetary Fund (IMF).
Earlier, IMF forecast that the country’s economy will shrink by 6.6 percent this year.