New UAE law promotes granting of citizenship to companies

What it means to be an Emirati company and the advantages it brings

A recent amendment to the UAE’s Commercial Companies Law aims to reinforce the concept of “citizenship” for companies established in the country, including those operating in free zones and financial free zones. The move is designed to strengthen their identity as Emirati entities and enhance their access to global markets.

During the media briefing Abdulla bin Touq Al Marri, Minister of Economy and Tourism, stressed that the provision applies strictly to the company itself – not to its owners, shareholders, or investors. The clarification followed media questions about whether foreign investors establishing businesses in the UAE could obtain citizenship under the new law.

“When a company is established in the country, it takes the status of an Emirati company. This already exists,” Al Marri said. “It does not grant citizenship to the owners. The company itself is recognised as a UAE company.”

He added that the approach is consistent with international practice. “If you open a company in Germany, you are a German company. If you open a company in the UK, you are a UK company. In the same way, if you open a company here, you are a UAE company.”

According to Al Marri, the benefits of Emirati status are primarily commercial and strategic, particularly in the areas of trade, incentives, and market access.

“When it comes to trade and benefiting from signed agreements such as the CEPAs, Emirati company status allows businesses to take full advantage of these opportunities,” he said.

“If local governments want to issue incentives for local companies, this status applies as well. There is significant value in that.”

The UAE has signed more than a dozen Comprehensive Economic Partnership Agreements (CEPAs) with countries including India, Türkiye, Indonesia, Israel, South Korea, Cambodia, Georgia, Colombia, and Mauritius, with several more currently under negotiation.

These agreements reduce or eliminate tariffs, simplify customs procedures, and open access to new sectors, giving UAE-based companies preferential entry into high-growth markets.

By being recognised as Emirati entities, companies can more easily leverage these agreements, enhance their credibility in international markets, and strengthen their position in cross-border trade.

By reinforcing companies’ Emirati identity, the government aims to strengthen national brands, enhance the credibility of UAE-based businesses abroad, and support their expansion into global markets.

“This is about positioning the UAE companies at the forefront of global trade and investment,” Al Marri said.

The amendment also confirms that Emirati status applies not only to mainland companies but also to those established in free zones and financial free zones reinforcing the UAE’s economic identity and enhancing access to global market.

The changes form part of a broader overhaul of the UAE’s business legislation aimed at positioning the country as one of the world’s most attractive destinations for investment and entrepreneurship.

Key amendments include:

• Allowing multiple classes of shares in limited liability companies and joint stock companies.
• Permitting companies to transfer registration between emirates and free zones without losing legal identity.
• Introducing clearer rules for shareholder exits, mergers, and acquisitions.
• Allowing free zone companies to open branches on the mainland.
• Introducing non-profit commercial companies.

The Ministry of Economy expects the reforms to increase company registrations and licenses by 10–15 per cent in the first year.