Abu Dhabi will issue foreign direct investment licences to investors, allowing 100 per cent foreign ownership of businesses with capital of Dh2 million ($544,588) and above as part of its efforts to boost sustainable economic development.
The FDI licence, issued by the Abu Dhabi Department of Economic Development (Added), will cover 122 economic activities in sectors including agriculture, industry and services, the department said in a statement on Wednesday.
"The implementation of the FDI law in Abu Dhabi through the 'Foreign Direct Investment' licence contributes to achieving various objectives such as expanding the base of foreign investments; increasing the size of capital flows; enhancing and diversifying local production; and increasing the emirate's exports of goods and services," Mohammed Ali Al Shorafa, chairman of Added, said.
In 2018, the UAE approved a new foreign investment law that would allow foreigners to own more than 49 per cent and up to 100 per cent stake in some UAE businesses. Abu Dhabi's new FDI licence is part of the government's efforts to attract foreign investment to the emirate, particularly in the non-oil sector.
Within the agriculture sector, the licence applies to companies planting grains, vegetables and fruits; activities related to crop and livestock production; and seed processing for reproduction, according to a tweet by the Abu Dhabi Media Office.
Within the industries sector, companies involved in food and beverage products, clothing and leather production, wood and cork products, production of plastics and synthetic rubber, and agricultural chemical products are eligible for the licence.
Within the service sector, businesses in marine transport, accounting and consulting services, hotel and restaurant management, computer programming services and research and development in science and technology, among others, can also apply for the FDI licence.
Earlier this year, Abu Dhabi identified a list of investment opportunities across a variety of sectors including healthcare, food production and energy that are open to foreign investors.
Mr Al Shorafa said the move will encourage investors, spur business development for foreign companies and attract businesses in technology and advanced industries, which contributes to Abu Dhabi's push for economic diversification.
Investors can secure the new FDI licence through Added's Abu Dhabi Business Centre by obtaining approval after completing required documentation and paying fees, according to Rashed Al Balooshi, Undersecretary of the department.
Some activities that do not conform to conditions for an FDI license are subject to approval through the UAE Cabinet, the department said.
A total of 13 activities – petroleum exploration and production; ground and air transportation services; activities related to investigations, security and military sectors; weapons manufacturing; banking and finance activities; and medical retailing such as private pharmacies – are not covered by the new licence.
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Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
