The Ministry of Economy (MoE) is in the process of developing new laws as part of modernising the legislative system and enhancing the business environment in line with the UAE strategic vision for 2021.
The new laws will cover foreign investment, competition, certificate of origin, arbitration, industry affairs regulation, amendment of industrial ownership, anti- commercial fraud, auditors profession regulation and companies law. The competition law will lay down the mechanisms governing healthy competition in business while the law of commercial arbitration will plug the gaps in the existing one.
The new laws seek to address the existing gaps in commercial regulations and arbitration and promote efficiency, transparency and investor confidence in the business sector. "The UAE is revamping its legal system to reflect the changes in the global economic landscape and maintain its competitive edge as a centre of business. It is a thorough process that will fulfil specific conditions and will require a lot of time, research and consensus among all parties involved," said Sultan Saeed Al Mansouri, Minister of Economy.
"The Ministry of Economy has its own strategy for strengthening the national economy and retaining the competitive edge of the UAE as a global business centre and investment destination. Our vision complements the UAE Vision 2012 and we work with all stakeholders in formulating policies and guidelines," he added.
Al Mansouri said passing the laws involves several steps. First, the ministry will seek the Cabinet's permission in forming the law, and the first draft will be shared with all parties concerned in the government and private sectors. The draft law is then sent to the Cabinet for approval and to the Legal Technical Committee at the Ministry of Justice that amends the draft in co-ordination with the Ministry of Economy.
The law will then be referred to the Ministerial Legal Committee to be discussed and amended. It will then be transferred to the Cabinet for revision and approval. After this, it will go to the Federal National Council for discussions and approval and to the Ministry of Presidential Affairs for issuing it officially.
The proposed foreign investment is envisaged to unify legislations for foreign investments and includes required exemptions and guarantees for investment projects. It is planned to ensure investors the rights in managing their projects. It also reduces cost through customs exemption rates and the investment window services, which facilitate procedures of licensing, insurance and flexible capital transfer and effective mechanisms for resolving disputes.
The ministry has already prepared the competition law, which has been finalised by the Ministerial Legal Committee and will now be sent to the Cabinet. This law will encourage competition and support the UAE's economic development drive. The law will reduce monopoly practices in line with the recommendations of the World Trade Organisation (WTO) during its last review for the trade policy of the UAE.
The certificate of origin law aims to re-organise legislations related to certificates of origin in order to specify the origin of the homeland of the commodity and will allow the ministry to impose fines and penalties on incorrect documents and data.
The ministry has also finalised the draft of the arbitration law in co-operation with a group of legal experts from Abu Dhabi Arbitration Centre. The industry law that the ministry worked on, will develop the performance of the industrial sector. It will stipulate plans to encourage small and medium industries and enhance the quality of products. It will work to protect the UAE products from harmful practices such as dumping and will be in line with the standards issued by WTO regarding trade exchange and increasing exports volume.
The auditors law aims at enhancing and developing the economic infrastructure and competition by strengthening the auditors profession and also contributes to achieving greater transparency and disclosure of the institutions in the UAE.
The anti-fraud law will preserve the earnings of the UAE as it is considered one of the re exports hubs and will support trade policies. The law is aimed at protecting the UAE's economic interests, enhancing its negotiating power and supporting the coordination process of drawing economic policies between the federal and local governments.
The new companies law being discussed by the Ministerial Legal Committee, will make it mandatory for companies in the UAE to put a general corporate governance framework to ensure protecting shareholders rights and achieve transparency and disclosure of financial results and reports.