Investors will also demand further activities to be subject to foreign ownership exemptions, said the chairman of Baker McKenzie Habib Al Mulla
Further changes to the UAE’s residency law are expected in the coming year, as the UAE cabinet begins the implementation of the 10-year residency visa law for expats, investors and businesspeople, according to the chairman of UAE law firm Baker McKenzie, Dr Habib Al Mulla.
In an opinion piece looking ahead to 2019, submitted to Arabian Business, Dr Habib Al Mulla said residency laws will likely be altered further in order to attract more foreign investors.
"We can only expect more initiatives to improve the UAE’s status on all fronts, particularly when it comes to commercial law. And while the UAE has done much in this regard, I believe there is still room for improvement. So I predict a further relaxation of residency laws through minor alterations in order to make them more appealing, once the new regulations find their way into implementation,” he said.
Al Mulla said he expects similar changes to the 100% foreign ownership laws, as they fail to offer regionally competitive incentives.
“The same would apply to foreign ownership laws. In my view, the current changes, although highly welcomed, remain insufficient in attracting serious and large foreign investments, particularly with the incentives that other countries in the region are offering,” he said.
“Investors will demand, rightly so, further activities to be subject to the foreign ownership exemptions,” he added.
The full ownership of companies based in the UAE is currently limited to free zones, which allow struggle to compete as their bestselling proposition is weakened, according to Al Mulla.
“Naturally, with more exemptions, free zones will feel the pressure and will struggle to compete unless they manage to change their modus operandi, although competition is healthy and can only benefit the economy,” he said.
This year, investors, entrepreneurs and specialists working in fields of medicine, science or research in the UAE will be eligible for a five or 10-year residency visa depending on the size of their investment in the country.