At the end of 2018, the introduction of resident UAE visas with a validity period of up to ten years is expected, while now resident visas have a validity period of only two to three years. In addition, it will be possible to register a local company in the UAE with 100% foreign ownership.
How will it influence the situation?
So, the changes in legislation will concern the rules of residency and ownership of companies. The best way to attract global investment and exceptional talented people in the UAE is to create an open tolerant environment, infrastructure and flexible legislation. And these new planned changes in legislation are an important step towards achieving this.
At the end of 2018, it is planned to introduce ten-year resident UAE visas for qualified professionals and their families, as well as for business owners. This will have a huge impact both in terms of the stability that is offered to the expats, and in terms of the decisions they make in investing in their future.
In the near future, the issue of expatriates staying in the UAE after retirement can also be considered. After all, the one who will use the ten-year resident UAE visas, and at the same time will invest in local real estate, in the end will require some assurance that he will not have to sell everything and leave after retirement.
One of the key aspects of the change is the indirect recognition that those categories of expats who will be able to receive ten-year resident UAE visas are more likely to not be treated simply as temporary workers. This will radically change their own views on their status in the UAE.
It is important to note the decision to allow foreigners to own 100% shares of local companies, currently foreigners can not yet own more than 49% of local companies (companies outside the free zones).
There is potential benefit to the stock markets in Abu Dhabi and Dubai, where existing restrictions on the percentage of foreign ownership to some extent repel foreign buyers. As a result, the companies proposed in the listing will be able to become more attractive.
But not for everyone the new initiatives will have positive effect.
For example, existing rules on company ownership help to ensure that citizens of the emirates can participate in the created capital in the local economy. As soon as 100% foreign ownership is allowed, many foreigners are likely to wish to terminate their agreements with an existing local partner owning 51% of the company’s shares.
In addition, a change in visa regulations can lead to a rapid increase in long-term immigration in the UAE to people of working age, not only from this region, but also from around the world. This, in turn, raises questions related to providing housing and places in schools and universities for immigrant children. While it is difficult to assess to what extent the further development of the infrastructure of the UAE should meet the needs of expats.
All these issues and much more, will be taken into consideration by the government in discussions preceding the introduction of the law in late 2018.