100% Foreign Ownership in the UAE: A Game-Changer for Global Investors

100% Foreign Ownership in the UAE: A Game-Changer for Global Investors

The UAE business setup environment has undergone a massive transformation, especially with the introduction of 100% foreign ownership for mainland companies. This pivotal reform is attracting new investors in the UAE, eager to leverage a more flexible and investor-friendly framework for new company formation.

What is 100% Ownership in the UAE?

Previously, setting up a business in the UAE mainland required a local Emirati sponsor holding a 51% stake in the company. However, the updated UAE Commercial Companies Law (Federal Decree-Law No. 26 of 2020) now allows foreign investors to have 100% ownership for a wide range of business activities, eliminating the need for a local partner in many sectors.

Who Can Benefit from 100% Ownership?

This change primarily benefits:

• New investors in the UAE are exploring local market access
• Existing businesses looking to restructure
• Entrepreneurs launching startups through new company formation

Most activities under the professional, commercial, and industrial categories are now eligible. The list of permissible activities varies by emirate and is governed by the respective Department of Economic Development (DED).

Key Business Sectors Eligible

• Information Technology
• E-commerce
• Manufacturing
• Education & Training
• Consultancy & Legal Advisory
• Renewable Energy
• Logistics & Media

These sectors offer promising opportunities for UAE Mainland business setup with full ownership.

Top Benefits of 100% Foreign Ownership

• Full control over business operations and finances
• No need for profit-sharing with a local sponsor
• Enhanced transparency in business registration
• Greater appeal to new investors in the UAE
• Direct access to government and private sector contracts (mainland)

UAE Mainland vs Free Zone Company Setup

While a few free zones still offer tax exemptions and 100% profit repatriation, the UAE Mainland business setup is now more appealing thanks to full foreign ownership combined with:

• No trading restrictions across the UAE
• Freedom to operate in the local market
• Eligibility for government tenders and contracts

Important Considerations for New Investors

• Ensure you comply with all regulatory requirements
• Understand the licensing fees per Emirate
• Use the right legal structure for your UAE business setup
• Stay informed about VAT, UBO, and economic substance rules

How CLA Emirates Can Support You?

At CLA Emirates, we assist new investors in the UAE with:

• Business activity assessment for 100% ownership
• Complete the UAE Mainland business setup and business registration
• Advisory on the most cost-effective licensing options
• Corporate structure planning
• Visa processing and bank account support

Frequently Asked Questions (FAQs)

Can foreign investors now own 100% of a mainland business in the UAE?

Yes, recent legal reforms allow foreign investors to have 100% ownership of companies in many sectors without the need for a local Emirati sponsor, especially in UAE Mainland business setup.

What types of business activities qualify for 100% foreign ownership?

Most commercial, industrial, and professional activities qualify. These include sectors like IT, consulting, trading, manufacturing, and e-commerce. The exact eligibility depends on the emirate and its Department of Economic Development.

Is 100% ownership available for free zone companies, too?

Yes. Free zones in the UAE have always permitted 100% foreign ownership. However, they restrict direct trade in the local market unless you appoint a distributor or set up a mainland branch.

What are the steps for business registration in the UAE with 100% ownership?

The basic process involves selecting a business activity, reserving a trade name, obtaining initial approval, leasing office space, and completing the business registration through the relevant authority. We recommend expert guidance for a smooth UAE business setup.

Call for Consultation
Mr. Ragesh Mattummal | Partner & Co-Founder
M: +971 50 357 8031
E: Ragesh.Mattummal@claemirates.com
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