UAE Cabinet Approves Draft Law Amendment to UAE Agency Law
The UAE, with the aim to strengthen national framework for boosting trade and investment in the Middle East’s most advanced economy, approved amendments in Federal Law Number 18 of 1981 pertaining to Agency Law. The UAE Cabinet has approved a draft law amending provisions of the nation's law, a move which comes within the framework to enhance the country's trade and investment development.
The amendment to this law shall affect public shareholding entities, UAE nationals, foreign investors and small and medium enterprises. The amendments to this federal law shall provide big opportunities to family-owned enterprises to convert into public joint stock companies by providing high quality services. The new law shall open opportunity for transformation of family-based business houses to enlist themselves to UAE financial market. This also aims at encouraging the family-based business of Emirati population to enlist on financial markets once they go through corporate restructuring. This subsequently would provide encouragement to the Emirati nationals to invest in the public shareholding companies as well as in commercial agencies with least investment risk.
This is so because for owner of small and medium enterprises (SME) and small or retail shareholders it would provide necessary protection under the statute in event of termination or non-renewal of agreement on basis without material reasons. This amendment shall in a way ensure continuum of family businesses with sound governance and recourse in case of default.