The maximum level of foreign ownership in UAE companies could be raised to 70 per cent or even higher for certain sectors as part of changes to the Company Law being considered by the Federal Government.
This was revealed by Hussain Al Nowais, a member of the board of the Abu Dhabi Council for Economic Development and Chairman of Al Waha Capital.
Such a move would give the minister of economy the power to specify the rate of foreign ownership in line with the added value offered to the economy by overseas investment in specific industries.
“There were proposals to push the rate of foreign ownership up from the current 49 per cent to 51 per cent, 60 per cent and 70 per cent, but some sectors might need a higher rate,” said Al Nowais. A committee was studying the proposals.
“Many foreign companies and investors would like to invest in the UAE, and Abu Dhabi in particular,” said Al Nowais.
“We do not mind as long as they offer added value to our economy. As for small companies or trading shops, their return to the national economy is small and their ownership rate should not be raised.”
Al Nowais, who was attending the third annual AVCJ Private Equity & Venture Forum/Middle East in Abu Dhabi, said the Ministry of Economy had put the Company Law forward for amendment. The law needed to be changed to meet the growing desire of foreigners to invest in the UAE.
“We have to develop our economic laws to attract private investment fund capital and benefit from the privatisation of government companies,” the Chairman of Waha Capital said.
Foreign ownership may be higher than 70%