DUBAI: UAE free zones may still attract smaller businesses despite new rules allowing foreigners to start a company without an Emirati shareholder, said a Moody’s analyst.
The law, which comes into effect from June 1, allows full ownership for foreign investors. Before this was only possible in dedicated business parks known as free zones.
The change has created uncertainty over the future role of such free zones as the country ramps up efforts to boost investment amid fierce regional competition to attract foreign companies.
“The removal of the foreign ownership limits for on-shore businesses reduces one of the major competitive advantages of free zones over on-shore investment,” Thaddeus Best, an analyst at Moody’s Sovereign Risk Group, told Arab News. ”However, the new FDI law still generally requires higher minimum capitalization levels for onshore businesses compared to the free zones. As such, free zones will still be more attractive for micro, small and medium enterprise (MSMEs), while the larger multinationals (that the new FDI law aims to attract) will now be able to invest onshore with no foreign ownership restrictions.”
Some UAE free zones are already shifting focus amid the latest regulatory upheaval in the sector.
Last week the Dubai Airport Free Zone Authority (DAFZA) said it was targeting the cryptocurrency sector with companies trading with crypto assets now allowed to obtain a business license at DAFZA.
Other free zones in the country, some of which are home to thousands of employees and major international occupiers, may now also need to target new sectors.
“Undoubtedly there will be more competition for the free zones as a result of the law but the lower capitalization requirements will keep their proposition attractive for many companies, particularly smaller ones,” added Best.
The World Free Zones Organization did not respond to requests for comment.
UAE free zones could still attract smaller firms despite new law, says Moody’s
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UAE free zones could still attract smaller firms despite new law, says Moody’s
- The law, which comes into effect from June 1, allows full ownership for foreign investors
Saudi Arabia among top states in tech security with 99% score, says official
RIYADH: Programs and security initiatives launched by the Ministry of Interior have contributed significantly to improving quality of life in Saudi Arabia by generating high-quality data that supports planning and enables faster responses, placing the Kingdom in the global spotlight, Khalid Al-Bakr, CEO of the Quality of Life Program, told Al-Eqtisadiah.
He noted that the Unified Security Operations Centers 911 in Riyadh, the Eastern Province, Madinah, and Makkah are among the Quality of Life Program’s initiatives implemented in partnership with the Ministry of Interior, producing data that helps develop plans and ensure swift responses to incidents.
Al-Bakr added that technology has been integrated into security capabilities, including the use of body cameras for security personnel, which has helped maintain high levels of public safety.
He highlighted that reporting violations or crimes via 911 has an average response time of just two seconds, describing it as a technological leap that serves residents and visitors alike and enhances trust in security services.
The CEO of Saudi Arabia’s Quality of Life Program said the Kingdom ranks among the top countries globally in security technology, with a 99 percent rating, emphasizing that Saudi Arabia is a leader in leveraging advanced security technologies to serve residents and visitors, making it an attractive place to live and visit.
Al-Bakr explained that the major transformation in the use of technology — particularly in services provided by the Ministry of Interior — has had a significant impact on quality of life, noting that accessing services such as passport or national ID renewal has become faster and more convenient, often available at the click of a button.
