The long-awaited UAE Commercial Companies Law No. 2 of 2015 (the "CCL") has recently been issued. The CCL will come into force at the end of June 2015 and will substitute the current Commercial Companies Law in its entirety. All existing UAE companies must comply with the CCL by the end of June 2016.
Some of the key changes under the new law are as follows:
- The 51 percent local shareholding requirement continues to apply. However, the CCL contemplates that free zone companies (this includes companies established in the free zones of Dubai Healthcare City and Dubai Biotechnology & Research Park) will be permitted to apply for a licence to carry out activities onshore or in other free zones, subject to the terms and conditions to be set out by the Council of Ministers. The issuance of the resolution of the Council of Ministers will determine to what extent free zone companies will be granted this flexibility and whether this right will, as a practical matter, meet the 51 percent local shareholding requirement.
- Penalties and sanctions relating to certain breaches and violations of the CCL, including those relating to nominee structures, have been tightened.
- Take-overs are now formally regulated under the CCL.
The CCL has been very recently issued, its application and interpretation will be an on-going process, particularly until the suite of implementing regulations are issued.
The UAE has also issued Federal Law No. 4 of 2015 Concerning Private Health Facilities. The law is applicable to all private health facilities in the UAE including those operating in free zones. It will come into force at the end of September 2015 and will replace the existing law of 1996 on Private Health Facilities.
The key provisions of the law include:
- general principles for obtaining a licence to establish, operate or manage a private health facility in the UAE;
- obligations on private health facilities in relation to insurance contracts, patient rights, qualifications, health and safety conditions, pricing, emergency plans, etc.; and
- a general framework for inspections and sanctions in case of non-compliance.
The new law will be further implemented by means of an Executive Regulation which will be issued at the end of September 2015. This Executive Regulation will provide further detail on the scope and extent of the requirements and the procedures to be followed. All private health facilities existing prior to the entry into force of the new law will have one year as of the issuance of the Executive Regulation to adjust their operations and comply with the new provisions. New facilities established after the entry into force will need to comply immediately.