Local lawyers have identified significant
shortcomings in the UAE’s Commercial Companies
Law, which came into effect on July 1.
Although it has been positively received overall,
its lack of clarity and failure to address the pressing issue
of foreign direct investment has drawn criticism.
"Unfortunately the new law hasn’t
brought the watershed changes we were expecting," said Warren
Thomson, partner at Hogan Lovells.
"It’s been in gestation in one form or
another for over 10 years, and in a way it came as a bit of a
disappointment that the restrictions on foreign ownership
weren't relaxed, as many had hoped," he added.
The law’s various changes include a simplified
process for pledging shares and removal of the five-person
limit on the number of managers. It also prohibits companies
from providing any...