The Ministry of Economy (MOE) in the United Arab Emirates (UAE) has announced that a new law on commercial offices will come into effect on June 16, 2023.
Under this law, the business of commercial agencies will be limited to UAE nationals and public joint-stock companies with at least 51% of the national capital contribution.
National capital contribution in the UAE is the percentage of a company’s ownership or investment held by UAE nationals or joint stock companies.
However, under certain conditions and with the approval of the UAE Cabinet, international companies may still be allowed to act as commercial agents for their own products.
The purpose of the new proposed law is to help commercial offices expand and contribute more to the national economy by diversifying their activities and improving their performance. In addition, it seeks to improve the investment climate and safeguard the interests of the contracting parties.
Abdulla Al Saleh, undersecretary of foreign trade and industry at the Ministry of Finance, said the law would encourage domestic investment and foreign direct investment (FDI) in the country.
He also noted that it will enable commercial offices to grow and offer consumers better products and services, as well as provide new job opportunities across the country.