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President issues decree amending some provisions of corporate law

Aug 10, 2009 - 02:38 -

WAM Abu Dhabi, Aug. 10, 2009(WAM)--Partners in limited liability companies will determine sufficient capital requirements for establishment of their companies in contrary to the previous law, which specified Dh150 000 as a minimum to create such companies, according to a decree issued by President His Highness Sheikh Khalifa bin Zayed Al Nahyan.

Sheikh Khalifa issued a decree, amending some provisions of the federal law number 8 of year 1984 in regard to corporate law to reduce cost of setting up new businesses.

The move reflects the federal government's stance to boost the investment environment and leverage the UAE's standing as a highly competitive economy. It guarantees economic activities' sustainability and encourages businesspersons and investors to establish new companies and businesses.

The issuing of the decree aims at limiting bureaucratic procedures as the investor won't need any bank certificates for instance. This will limit the process time to set up private business in the country, a vital issue to enhance the performance of the investment environment and attract more foreign money to invest in the UAE.

The small and medium businesses sector will be a great beneficiary from this amended law which enhances flexibility to new businesspersons in the UAE as it will promote innovation and the spirit of entrepreneurship amongst business leaders; the move will contribute to overcoming a major obstacle for establishing a company: fulfilling the capital requirement.

The decree comes in a period where the UAE is witnessing several developments requiring the reassessment of legislations and laws in a bid to increase competitiveness of the country regionally and globally. It also highlights the government's interest in helping the private sector to overcome challenges and issues hindering its growth and respond to these problems, thus ensuring business and investment activities' growth continuity.

His Excellency Sultan bin Saeed Al Mansouri, UAE Minister of Economy, praised this move as he considered it "a positive step to attract more investments to the country, adding that " This decree underlines our wise leadership's vision and strategy aiming at developing the investment environment in the UAE, diversifying sectors and activities of our economy to ensure economic prosperity and welfare to the UAE community." WAM/MN