UAE mulls move to allow 100% foreign ownership

UAE expatriates could soon be able to own 100 percent of businesses outside the country’s free zones, as part of a radical shake-up of foreign investment rules, it was reported on Monday.
   
A top Dubai government official told UAE daily Khaleej Times that the emirate’s officials were promoting more liberal rules on business ownership to the federal government, in a bid to counter the negative impact of the economic slowdown.  

All seven emirates were now considering the proposals - weighing up the costs and benefits - added Khalid Al Kassim, Deputy Director General at Dubai’s Department of Economic Development (DED).
 
It was in the UAE’s best interests to ease restrictions on foreign ownership, which is currently limited to the Emirates' 30 free zones, Al Kassim said.  

"We are trying to push 100 percent ownership for the whole country, but Dubai alone cannot do it," he told a business meeting organised by the DED and the Italian Business Council of Dubai and Northern Emirates.

"We are looking to revise rules and regulations. If there are concerns, the laws will be made flexible according to the needs of the business community," he added.

The federal government would be the body to announce the new rules and regulations, Al Kassim revealed, but refused to give a timeframe.

Dr Nasser Saidi, Chief Economist at Dubai International Financial Centre, welcomed the plans.

The change would not only attract substantial new foreign direct investment in the UAE but would also help generate jobs, he predicted.

Last year foreigners set up 342 projects in Dubai, up 59 percent from 2007.

And foreign direct investment soared by 123 percent to $21bn in the emirate, according to a study released last month by the Financial Times FDI Intelligence.

At present overseas firms, working outside the free zones, must set up a branch, or form a company with a local sponsor, who must own a 51 percent stake in the firm.

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