Hi Henrik,

I'm Deepak Pant, Banking Consultant at DhanGuard, and this is an excellent question because the UAE Commercial Companies Law forms the legal foundation for mainland businesses in the country.

Recent updates to the law have made Dubai significantly more attractive for international entrepreneurs by simplifying company ownership, improving corporate governance, and introducing greater flexibility for businesses.

Here are some of the key implications for mainland company formation in Dubai:

Greater Foreign Ownership

One of the biggest changes is that 100% foreign ownership is now permitted for most commercial and industrial business activities. This means that, in many cases, foreign investors no longer need a UAE national partner to establish a mainland company. Only a limited number of strategic sectors, such as defence and certain security-related activities, continue to have ownership restrictions.

More Flexible Company Structures

The law also allows mainland companies to adopt more sophisticated ownership arrangements. Businesses can create different classes of shares, giving shareholders different voting rights, dividend rights, or financial privileges depending on the company's requirements.

In addition, internationally recognised shareholder protections such as drag-along and tag-along rights can now be incorporated into the company's Memorandum of Association, providing greater confidence for investors.

Easier Business Mobility

Another important development is the ability for companies to re-domicile between eligible free zones and the mainland while maintaining their legal identity and business history, subject to regulatory approvals. This provides businesses with greater flexibility as their operations grow or change over time.

The law also clarifies that free zone companies operating branches or carrying out commercial activities on the mainland must comply with the relevant provisions of the Commercial Companies Law.

Stronger Compliance Requirements

With these benefits also come greater governance responsibilities. Mainland companies are expected to maintain higher standards of transparency through:

• Proper corporate governance procedures.
• Clearly defined responsibilities for directors and managers.
• Audit requirements where applicable.
• Mandatory Ultimate Beneficial Owner (UBO) disclosures to support anti-money laundering (AML) compliance.

For most foreign investors, these legal reforms have made mainland company formation far more straightforward while aligning the UAE's corporate framework with international business standards.