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In September 2018, the UAE issued the Foreign Direct Investment Law (FDI Law) to open up the UAE mainland market to foreign investors in certain sectors of the economy. This was followed by the announcement on July 2019 of the relaxation of foreign ownership restrictions for 122 business activities, specifically in the manufacturing, agricultural and services categories (Positive List), pursuant to the FDI Law.

On 17 March 2020, the UAE Cabinet issued Cabinet Resolution No. 16 of 2020 containing the full FDI Positive List and the requirements for establishing FDI companies in the UAE mainland, reinforcing the UAE’s commitment to become the leading foreign investment destination in the region.

Positive List

With the issuance of the full Cabinet Resolution, the UAE has now confirmed the Positive List of 122 economic sectors and activities in which foreign direct investment is permitted and the criteria for the licensing of FDI companies. This includes the minimum capital requirement for each activity, the Emiratisation thresholds, and the specific conditions for certain business activities. A link to the Resolution and the full list of activities and criteria can be found here.

As the Department of Economic Development (DED) in the respective Emirates is tasked with implementing the Resolution and imposing the various requirements, we are closely monitoring the situation and will provide further updates on how the Resolution will be applied in practice.

To speak to us in relation to any foreign investment issues in the UAE, please feel free to contact one of the lawyers below, or your usual Baker McKenzie contact. You can also subscribe to our Middle East Insights blog to receive future updates: https://me-insights.bakermckenzie.com/.

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Author

Omar Momany is a partner in Baker McKenzie Habib Al Mulla and is the is head of the UAE Corporate/M&A practice and focuses his practice on public and private mergers and acquisitions, corporate restructurings, corporate governance, joint ventures, commercial matters and corporate/shareholders' disputes in the UAE and throughout the region. Omar has over 15 years of experience in the Middle East and has acted for local and regional corporates and financial institutions, governments and regulatory bodies, multinationals, family businesses and royal houses. He is bilingual in Arabic and English.

Author

Hani has been practicing since 2007 with a focus on M&A, reorganizations and post-acquisition integration as well as corporate structuring in the Middle East with a particular focus on the UAE and Qatar. His experience also covers general commercial contracts and advice on corporate governance and compliance. Hani holds an MBA degree and a Master's in Management alongside his law degree. He is fully trilingual and practices in English, French and Arabic, all three at a professional level. Prior to joining Baker McKenzie’s UAE offices in April 2012, Hani worked as a corporate associate at an international law firm in both Dubai and Doha between 2008 and 2012 and prior to that worked at an FMCG company and a private equity group in Kuwait.

Author

Tala Shomar is an Associate Baker & McKenzie Dubai office.