Foreign investment “Positive List” announced:
Foreign investors will be able to own a greater share in UAE companies operating in the 122 economic activities on the “Positive List”, which is grouped into three broad sectors: agriculture, manufacturing and services. It includes service industries such as construction and healthcare, mainstream manufacturing and agricultural activities (such as food cultivation and plastics manufacturing) as well as activities in newer and greener industries, plus tech-focused activities such as computer programming and holding company activities in intellectual property. The Positive List was published by the UAE Cabinet in July, pursuant to the new foreign investment regime set out in Federal Law No.19 of 2018. Companies wishing to invest must comply with conditions to investment and licensing requirements. Further Emirate-level regulations are expected to determine the permitted ownership percentage (which will be between 50-100%).
Passporting investment funds across the UAE and free zones:
Funds should be more easily promoted across the UAE and the financial free zones, the DIFC and the ADGM, without the need for additional licensing, following a new protocol regarding the marketing and selling of domestic funds to potential investors that was agreed between the Securities and Commodities Authority (SCA) in the UAE, the Financial Services Regulatory Authority (FSRA) in the ADGM or the Dubai Financial Services Authority (DFSA) in the DIFC.
Specialised committees to resolve insurance disputes:
Specialist committees will resolve retail and commercial insurance disputes resulting from complaints against insurers, according to Decision No.33 of 2019 relating to the regulation of Insurance Disputes Resolution Committees, made under the UAE Insurance Law (Federal Law No.6 of 2007). The process of resolving these kinds of disputes should be quicker and easier as a result.
Data protection modernisation and the internet of things:
The UAE Telecommunications Regulatory Authority (TRA) issued a new Internet of Things (IoT) regulatory framework. It regulates the provision of IoT services in the UAE by individuals, companies and public authorities, whether they are located in the UAE or are outside the UAE. New data protection provisions draw on international best practice (specifically the General Data Protection Regulation 2016/679 in the European Union (EU)), placing stricter obligations on those processing and controlling personal data.
Modernised governance rules for UAE public companies:
New rules allow UAE public joint stock companies (PJSCs) to use technology to streamline governance procedures. For example, shareholders can attend and vote in general meetings electronically and PJSCs can call general meetings using text messages or emails. PJSCs will need to amend their Articles of Association to be able to take advantage of these new procedures, which are set out in SCA Resolution No.(3/RM) of 2019 amending Resolution No.(7/RM) of 2016 concerning Standards of Institutional Discipline and Governance in Public Joint Stock Companies. The rules also enhance rules on insider trading, directors’ conflicts of interests and independence.
SCA amends Regulations on Trading, Clearing, Settlement, Transfer of Ownership and Custody of Securities:
In June, the SCA amended provisions regulating the dates and mechanisms of settlement in trading in the financial markets. Clearing houses now have greater flexibility to set the procedure and the time required to pay amounts owed to the broker or clearing member in sale and purchase transactions. The changes are set out in SCA Resolution No.(28/T.M) of 2019, Amending SCA Resolution No.(2) of 2001 Regarding the Regulations on Trading, Clearance, Settlements, Transfer of Title, and Retention of Securities. This development may help to prepare the UAE market for a possible future upgrade from Emerging Market status to Developed Market status on the MSCI Indices, the global indices tracked by investors.
Quicker enforcement process for foreign court judgments and arbitral awards:
Enforcing foreign court judgments and arbitral awards in the UAE should now be quicker and cheaper. According to UAE Cabinet Resolution No.57 of 2018 concerning the Executive Regulations of Federal Law No.11 of 1992, enforcement applications are made directly to the enforcement judge, who decides whether the conditions to enforce are met within three days. An enforcement order is then immediately enforceable.