The UAE has unveiled a major update to its Commercial Companies Law that formally grants “citizenship” status to businesses established in the country.
Under the new law, effective in 2026, companies registered in the UAE will be officially recognised as Emirati entities—though this status applies strictly to the company, not to its owners, shareholders, or investors, said a TOI report. According to Minister of Economy and Tourism Abdulla bin Touq Al Marri, the provision applies to all businesses formed anywhere in the UAE, including mainland companies and those based in free zones and financial free zones. This means entities operating from hubs such as DIFC and ADGM will now enjoy full Emirati corporate identity under the law. Officials clarified that the move aligns the UAE with global corporate norms. Just as a company registered in Germany is considered German, or one incorporated in the UK is British, firms registered in the UAE will now be recognised globally as Emirati companies. What ‘Corporate Citizenship’ Means — And What It Doesn’t Authorities have stressed that the new provision does not grant UAE citizenship to individuals associated with a company. The “nationality” applies only to the legal entity itself. Foreign founders, shareholders, or investors do not gain Emirati citizenship or residency benefits through this law. The rule covers all incorporated businesses, whether operating on the mainland or within free zones, to avoid confusion about eligibility. How Companies Benefit Legal recognition as an Emirati company brings several practical advantages:
- Stronger global identity: Official UAE status enhances credibility and trust in international markets.
- Trade advantages: Companies can more easily benefit from the UAE’s Comprehensive Economic Partnership Agreements (CEPAs), which lower tariffs and ease cross-border trade.
- Access to local incentives: Emirati-status companies may qualify for government support schemes and sector-specific incentives offered to domestic entities.
By reinforcing national identity for businesses, the UAE aims to help companies expand globally while remaining closely linked to the domestic economy.
Part of a Broader Corporate Law Overhaul
The corporate citizenship provision is part of Federal Decree-Law No. 20 of 2025, a sweeping reform of the UAE’s Commercial Companies Law. Other key changes include:
- Allowing multiple share classes for LLCs and joint stock companies
- Enabling re-domiciliation between emirates or free zones without loss of legal identity
- Clearer frameworks for mergers, acquisitions, and restructuring
- Introduction of non-profit commercial company structures
Together, these reforms are designed to modernise governance, attract foreign investment, and strengthen the UAE’s position as a global business hub.
With hundreds of thousands of new companies launched in recent years, the UAE hopes this legal update will anchor businesses more firmly to the country while boosting their ability to compete internationally under a unified “Brand UAE” identity.
