The UAE's recent economic reforms indicate that the "country's business environment is flexible" and it is committed to providing investors with some of the best incentives to start their ventures, according to a senior government official.
New legislation will spur growth, stimulate innovation, strengthen intellectual property and increase the country’s attractiveness to global investors, entrepreneurs and innovators, Abdullah Al Saleh, undersecretary of the Ministry of Economy, said at a media briefing on Tuesday.
President Sheikh Khalifa formally approved the most extensive legal reforms in the country’s history last month, before the Golden Jubilee celebrations of its formation.
These are expected to help the country attract more foreign direct investment and support the growth of small and medium-size enterprises to strengthen its economy.
Amendments to more than 40 laws, including to legislation on commercial companies, commercial registry and trademarks, were unveiled.
“These three laws, in addition to the laws and legislations previously announced by the government, are an open invitation. The UAE’s business environment is flexible and advanced, which will provide them [the companies] with the best possibilities and incentives to start their business and practice economic and trade activities,” Mr Al Saleh said.
“The new laws that were launched in conjunction with the UAE’s Golden Jubilee represent an important milestone in the development of the legislative system to drive national economic growth in line with the Principles of the 50. It puts in place proactive legislative frameworks that drive economic growth in the country over the next 50 years.”
The move is in line with the UAE’s ambitions to become a global business hub and further continue to diversify its economy.
The Arab world’s second-largest economy is undertaking measures to boost its economy. This year, it unveiled a strategy to boost the contribution of the industrial sector to Dh300 billion ($81.68bn) in the next 10 years, from Dh133bn currently.
The country also overhauled its commercial companies law last year to attract more foreign capital and annulled the requirement for onshore companies to have an Emirati shareholder.
Amendments to this law ensure an advanced investment environment enabling investors to implement vital projects for the economy, increase the attraction of foreign companies and attract foreign investments to the country’s vital economic sectors, the ministry said on Tuesday.
The law amendments include development of financing solutions for companies and restructuring operations and finding solutions to the challenges facing business activities in the country, it added.
The latest updates, announced on Tuesday in co-operation with the Securities and Commodities Authority, are “an additional step towards enhancing the business climate in the country to support the competitiveness of the national economy and the dynamism of the business environment”, Mr Al Saleh said.
Among other benefits, the new legislation allows companies to transform into a public joint stock company and sell its shares or offer new shares in a public subscription without being restricted to a certain percentage, by following the price-building mechanism of the security, the ministry said.
It also allows branches of foreign companies licensed in the country to transform into a commercial company with UAE citizenship.
All these amendments are aimed at transforming the country’s economic and legal environments, according to Maryam Al Suwaidi, chief executive of the SCA.
“I believe it [the amendments] will have a huge impact on the SCA, in terms of keeping up with global regulators, and also being an international hub or a financial centre for international companies,” she told The National on the sidelines of the media briefing.
“We have to be able to compete with other regulators and we are helping to make the UAE an attractive destination for international companies.”
Meanwhile, the commercial register law would help investors and companies develop their businesses based on documented, integrated and accurate information, according to the ministry.
The amendments to this law aim to make the Economic Register a comprehensive reference to help investors and companies develop their businesses based on documented, integrated and accurate information, the ministry said, detailing the new legislation. It will also enable the use of the unified economic register number as a digital identity for companies.
“The registry will serve as a leading platform that accelerates the growth of economic sectors and enhances the position of the UAE as a destination for future investments and innovative ideas in new economic sectors,” it added.
It will also support the UAE strategy 2021-2025 for digital transformation in terms of providing an enhanced digital infrastructure and a unified digital platform to support the integration of economic data for business sector services in the UAE, according to the ministry.
Amendments to the trademark law, the third economic reform highlighted by the ministry, would accelerate the issuance of licenses for businesses as well as speed up the completion of government approvals and procedures for companies.
This would contribute to enhancing integration in the work of service providers, increasing their contribution to SMEs, the ministry said.
The changes will also make available the database of trademarks to the public for free, which was formerly a paid service.
The move enhances confidence in the UAE’s markets and the business sector, and contributes to combating fraud and counterfeiting, preserving the rights of institutions, companies and individuals, according to the ministry.