«Economy»: Foreign investment law will not affect the shares of foreigners in public companies

The Ministry of Economy affirmed that the Foreign Direct Investment Law aims at attracting new foreign investments to the economic sectors and targeted activities in the country, stressing that saying that the Foreign Investment Law will allow raising the share of foreign investors and shareholders in public shareholding companies in the country does not proceed from a correct reading of the reality of ownership. Foreign investors in listed companies in the financial markets, the state's business environment, the details of the investment law.

Legislative framework
In detail, the Ministry of Economy affirmed that Federal Law Decree No. 19 of 2018, on FDI in the UAE, represents an integrated legislative framework for the liberalization of a select group of economic activities to foreign investment flows, and attracting them more towards some vital economic sectors in the country in a percentage owned by foreigners. It may reach 100%, to correct the situation of foreign investors in the country, and enhance their confidence in local markets.
The ministry said in a statement today that the law represents a new starting point to push national efforts to build a competitive global economy based on knowledge and innovation, by providing the frameworks to increase the attractiveness of foreign investment, and to enhance the business climate in the country, especially the specific investments related to innovation, technology and various sectors This is reflected in the first positive list which identified 122 activities in a number of key sectors.

Foreign ownership
The ministry pointed out that some press reports and media statements of private officials, which argued that the availability of foreign ownership by up to 100% in some sectors, under the law, will have a wide impact in promoting the entry of foreign investors in the stock markets of the country, and increase their shares In publicly listed companies, statements are lacking in accuracy and objectivity, and would influence investment decisions in the stock market, and the attitudes of individual investors in particular.
According to the Companies Law, which allows foreign shareholders to own a 49% stake in the company according to the Memorandum of Association, the ceiling does not reach that ceiling or even half of it in many countries. Therefore, to say that the law of foreign investment will allow raising the share of foreign investors and shareholders in public shareholding companies in the state, does not proceed from a correct reading of the reality of ownership of foreign investors in companies listed in financial markets, the business environment in the state, as well as to the details of the law. Est “The increase in foreign ownership in these companies was not primarily dependent on the liberalization of sectors.”

The Ministry of Economy stressed that the law aims to attract new foreign investments to the economic sectors and targeted activities in the country, and open wider prospects for the business climate for investors and foreign capital from various regional and global markets.
Despite the expected development returns on the state economy as a whole and on FDI inflows as a result of the application of the law, reports and statements on this subject should be thoroughly investigated, especially since some of these reports referred to sectors not included in the positive list, Thus, they are not affected by the liberalization of sectors.