Federal Law no (8) of 1984, modified
by Law no (13) of 1988, streamlines the affairs
of trade companies in terms of legal types, setting-up
requirements, resolving or merger.
The law states seven
types of companies set up in the country and
taking its nationality:
Joint (Venture)
Company
Limited Partnership Company
Sharing Company
Public Stock Company
Private Stock Company
Limited Liability Company
Equity Partnership Company
In addition to that, the law organized procedures
to obtain licenses by branches of foreign companies.
The following are some features of the various
types of companies, with an explanation on the
branches of foreign companies:
Characteristics of
The Joint (Venture) Company:
Consists of
two or more partners, and all partners have
to be citizens
Shares not listed or transferable, except in
the case when the decision is unanimous
Partners are jointly responsible for the company’s
obligations
Each partner is regarded as a trader and the
bankruptcy of the company means the bankruptcy
of the partners
Characteristics of
the Limited Partnership Company:
Consists of
two or more partners
Partners are two kinds; the first – joint partners
responsible for the company’s obligations, and
the second – partners who are not responsible
for the company’s obligations but to the extent
of their shares in the capital
The share of joint partners who are UAE nationals
should not be less than 51 per cent
Partners’ shares can not be listed but with
the agreement of partners or in accordance with
the company’s contract and its restrictions
Exterior management affairs (those with third
parties) are handled by a joint partner, while
other partners handle interior management. Violation
of this rule would mean that the partners - who
are not responsible for the company’s obligations
but to the extent of their shares in the capital
– could be responsible for emerging obligations
