In line with the new Foreign Direct Investment (“FDI”) law, Federal Decree-Law No. (19) of 2018 (“FDI Law of 2018”) enacted on September 2018 the much-awaited positive list was introduced and approved on 02 July 2019 in Cabinet meeting in Abu Dhabi by the Vice President and Prime Minister of UAE.
The positive list covers 19 activities in agriculture sector, 51 activities in manufacturing sector and 52 activities in service sector. The positive list also highlights various criterion, like minimum capital requirement, use of advanced and latest technology and participating in Tawteen Club at Ministry of Human Resources & Emiratization to be complied with to allow maximum of 100% foreign ownership in mainland UAE. Some of the activities included in the positive list are as under:
- computer programming and consultancy,
- renting and leasing of machinery and equipment,
- Construction of buildings,
- pre-primary, secondary and higher education,
- hospital,
- packaging,
- restaurant and hotel management, and
- commercial ships rental.
It is further clarified that local governments in each Emirates will determine the percentage of ownership in each activity. In certain emirates, some activities could still require an Emirati shareholder, even if the foreign ownership threshold increases.
The introduction of FDI law is an effective tool to increase foreign investments in the UAE. According to the Ministry of Economy the FDI Law of 2018 could accelerate FDI flows by up to 20 percent this year. The FDI Law is a perfect launch pad, as UAE is moving towards the EXPO 2020 opening in October 2020. In this VUCA world, UAE appears to always stay a step ahead of its competition.
HOW WE CAN HELP?
We have provided the Positive and Negative Lists (as published) below for your ready reference.
- PKF can review your license and advise whether your activities are covered in the positive list;
- PKF can assist you with drafting of the necessary information and preparing documents for making a preliminary submission to the FDI authorities; and
- Discuss and follow up with the FDI authorities till the final approval is obtained.
Disclaimer:
This document has been prepared as a general guide. It is not substitute for professional advice. Neither PKF UAE nor its partners or employees accept any responsibility for loss or damage incurred as a result of acting or refraining from acting upon anything contained in or omitted from this document
PKF UAE is a member firm of the PKF International Ltd family of legally independent firms and does not accept any responsibility or liability for the actions or inactions on the part of any other individual member or correspondent firm or firms
POSITIVE LIST (AS PUBLISHED)
Agriculture Sector | 19 main and sub-main activities |
Manufacturing Sector | 51 main and sub-main activities |
Services Sector | 52 main and sub-main activities |
Total | 122 main and sub-main activities |
AGRICULTURE SECTOR | |||||
---|---|---|---|---|---|
# | Reference | Sectors and Activities | Minimum Capital
AED Million |
National Cadres and Training | Controls and conditions |
1 | 01111 | Seeds Cultivation (Wheat, Corn, Barley, etc…) | 7.5 | To participate in the Tawteen Partners Club at MOHRE |
|
2 | 01112 | Growing of leguminous crops | 7.5 | ||
3 | 0113 | Growing of vegetables and melons, roots and tubers | 7.5 | ||
4 | 0114 | Growing of sugar cane | 7.5 | ||
5 | 0116 | Growing of fibre crops | 7.5 | ||
6 | 0119001 | Flowers and Buds Cultivation | 7.5 | ||
7 | 0121 | Growing of grapes | 7.5 | ||
8 | 0123001 | Fruits and Citrus Cultivation | 7.5 | ||
9 | 0124 | Growing of pome fruits and stone fruits | 7.5 | ||
10 | 0125 | Growing of other trees and bush fruits and nuts | 7.5 | ||
11 | 0126 | Growing of oleaginous fruits | 7.5 | ||
12 | 0127 | Growing of beverage crops | 7.5 | ||
13 | 01289 | Growing of aromatic, drug and pharmaceutical crops | 7.5 | ||
14 | 0161 | Support activities for crop production | 7.5 | ||
15 | 0162 | Support activities for animal production | 7.5 | ||
16 | 0163 | Post-harvest crop activities | 7.5 | ||
17 | 0164 | Seed processing for propagation | 7.5 | ||
18 | 0210 | Silviculture and other forestry activities | 7.5 | ||
19 | 0240 | Support services to forestry | 7.5 |
MANUFACTURING SECTOR | |||||
---|---|---|---|---|---|
# | Reference | Sectors and Activities | Minimum Capital
AED Million |
National Cadres and Training | Controls and conditions |
20 | 10 | Manufacture of food products (except)
(1071) Manufacture of bakery products (105) Manufacture of dairy products (108) Manufacture of prepared animal feeds |
15 | To participate in the Tawteen Partners Club at MOHRE |
|
21 | 11 | Manufacture of beverages (except)
(1101) Distilling, rectifying and blending of (1102) Manufacture of wines (1103) Manufacture of malt liquors and malt |
15 | ||
22 | 14 | Manufacture of wearing apparel
(14109) Tailoring and Sewing of Wearing Apparel (1410122) Military Garments Manufacturing |
15 | ||
23 | 15 | Manufacture of leather and related products |
15 | ||
24 | 16 | Manufacture of wood and of products of wood and cork, except furniture; manufacture of articles of straw and plaiting materials |
15 | ||
25 | 2012002 | Straight or Complex Fertilizers Manufacturing |
15 | ||
26 | 2013 | Manufacture of plastics and synthetic rubber in primary forms | 15 | ||
27 | 2021 | Manufacture of pesticides and other agrochemical products |
15 | ||
28 | 2022 | Manufacture of paints, varnishes and similar coatings, printing ink and mastics |
15 | ||
29 | 2023 | Manufacture of soap and detergents,
cleaning and polishing preparations, |
15 | ||
30 | 2029006 | Glues and Prepared Adhesives Manufacturing |
15 | ||
31 | 2029008 | Manufacture of dyestuffs and pigments | 15 | ||
32 | 2029009 | Textiles and Leather Finishing Used Chemical Materials Manufacturing |
15 | ||
33 | 2029013 | Manufacture of photographic plates, films |
15 | ||
34 | 2029019 | Gelatine and Its Derivatives Manufacturing |
15 | ||
35 | 2029021 | Essential Oils Manufacturing (Essence) | 15 | ||
36 | 2029022 | Extracted Natural Aromatic Products Manufacturing |
15 | ||
37 | 2029023 | Aromatic Distilled Waters Manufacturing | 15 | ||
38 | 2029024 | Matches Manufacturing | 15 | ||
39 | 2029025 | Welding Powders and Pastes Manufacturing |
15 | ||
40 | 2030 | Manufacture of man-made fibres | 15 | ||
41 | 2100 | Manufacture of pharmaceuticals, medicinal chemical and botanical products |
15 | ||
42 | 22 | Manufacture of rubber and plastics products |
15 | ||
43 | 23 | Manufacture of other non-metallic mineral products |
15 | ||
44 | 24 | Manufacture of basic metals (except)
(242) Manufacture of basic precious and other non-ferrous metals (2432) Casting of non-ferrous metals |
20 | ||
45 | 25 | Manufacture of fabricated metal products, except machinery and equipment (except) (252) Manufacture of weapons and ammunition |
15 | ||
46 | 26 | Manufacture of computer, electronic and optical products |
15 | ||
47 | 27 | Manufacture of electrical equipment | 20 | ||
48 | 28 | Manufacture of machinery and equipment not elsewhere classified (except) (28259) Tobacco Products Machinery Manufacturing |
100 | ||
49 | 29 | Manufacture of motor vehicles, trailers and semi-trailers | 100 | ||
50 | 3011101 | Building of Commercial Vessels | 100 | ||
51 | 3011103 | Ships and Floating Structures Sections Manufacturing | 100 | ||
52 | 3011905 | Construction of Drilling Platforms, Floating or Submersible |
100 | ||
53 | 3011906 | Construction of Floating Structures | 100 | ||
54 | 3011907 | Building of Hovercraft | 100 | ||
55 | 3012 | Building of pleasure and sporting boats | 15 | ||
56 | 3020 | Manufacture of railway locomotives and rolling stock | 20 | ||
57 | 3030 | Manufacture of air and spacecraft and related machinery (except) (3030006) Military Ballistic and Guided Missiles Manufacturing |
100 | ||
58 | 3090 | Manufacture of transport equipment not elsewhere classified | 20 | ||
59 | 31 | Manufacture of furniture | 15 | ||
60 | 3220 | Manufacture of musical instruments | 2 | ||
61 | 3230 | Manufacture of sports goods | 3 | ||
62 | 3240 | Manufacture of games and toys | 3 | ||
63 | 3250 | Manufacture of medical and dental instruments and supplies | 20 | ||
64 | 3290 | Other manufacturing not elsewhere classified | 3 | ||
65 | 3312001 | Repair and maintenance of trains engines |
15 | ||
66 | 3312002 | Repair and maintenance of engines ship | 15 | ||
67 | 3315001 | Repair and maintenance of ships | 15 | ||
68 | 3315004 | Repair and maintenance of trains and railway equipment |
15 | ||
69 | 3315005 | Aircraft Engine and Part Repair & overhaul | 15 | ||
70 | 3315006 | Light aircraft maintenance & repair | 15 |
SERVICES SECTOR | |||||
---|---|---|---|---|---|
# | Reference | Sectors and Activities | Minimum Capital
AED Million |
National Cadres and Training | Controls and conditions |
71 | 6910002 | Legal Consultancy Offices | According to regulations in force | (Provided that no to appear in UAE Courts, conduct before official authorities or carrying out authentication duties). And to obtain approval of the concerned parties in the state | To participate in the Tawteen Partners Club at MOHRE |
72 | 692 | Accounting, bookkeeping and auditing activities; tax consultancy | According to regulations in force | Only tax planning for businesses, consulting and preparation and review of tax on business are permitted | |
73 | 711 | Architectural and engineering activities and related technical consultancy |
According to regulations in force | ||
74 | 862 | Medical and dental practice activities | |||
75 | 75 | Veterinary activities | |||
76 | 620 | Computer programming, consultancy and related activities | According to regulations in force | Provide technical team not less 5 programming specialists by the end of the first year of the company | |
77 | 72 | Scientific research and development | According to regulations in force | ||
78 | 7730-77300 | Renting and leasing of other machinery, equipment and tangible goods |
|||
79 | 471 | Retail l sale in non-specialized stores
(4711001) |
100 | ||
80 | 731 | Advertising | According to regulations in force | ||
81 | 732 | Market research and public opinion polling |
|||
82 | 702 | Management consultancy activities | |||
83 | 712 | Technical testing and analysis | |||
84 | 331 | Repair of fabricated metal products, machinery and equipment |
|||
85 | 8121-81210 | General cleaning of buildings | |||
86 | 742 | Photographic activities | |||
87 | 8292-82920 | Packaging activities | |||
88 | 823 | Organization of conventions and trade shows |
|||
89 | 741 | Specialized design activities | |||
90 | 7490005 | Legal Translation Services | |||
91 | 7490006 | Translation services, movies and television programs |
|||
92 | 7490012 | Translation Publications Services | |||
93 | 8299002 | Translation Services | |||
94 | 41 | Construction of buildings | According to regulations in force | Only large-scale infrastructure projects such as airports, highways and sport facilities exceeding AED 450 Million are permitted | |
95 | 42 | Civil engineering | |||
96 | 432 | Electrical, plumbing and other construction installation activities |
|||
97 | 433 | Building completion and finishing | |||
98 | 431 | Demolition and site preparation | |||
99 | 439 | Other specialized construction activities | |||
100 | 7730009 | Construction and Building or Demolition Machines and Equipment Renting |
|||
101 | 851 | Pre-primary and primary education | According to regulations in force | ||
102 | 852 | Secondary education | |||
103 | 853 | Higher education | |||
104 | 854 | Other education | |||
105 | 370 | Sewerage | |||
106 | 382 | Waste treatment and disposal | |||
107 | 3900001 | Pollution Consequences Treatment and Environment Protection | |||
108 | 861 | Hospital activities | 100 | Subject to approval of the concerned parties based on economic needs tests that consider the number of hospitals, medical and health centres in specific area. The economic needs tests are not required in Dubai Healthcare City (DHC) | |
109 | 869 | Other human health activities | 70 | ||
110 | 8211001 | Hotel Management | According to regulations in force | ||
111 | 8211004 | Restaurants Management | Only theatre activities, live bands activities and circus services activities are permitted | ||
112 | 90009 | Creative activities and presentation of arts drama (theatre) | |||
113 | 9000104 | Music Band | |||
114 | 9000110 | Circus | |||
115 | 8130002 | landscape and gardening services | |||
116 | 9103-91030 | Botanical and zoological gardens and nature reserves activities | Only public parks services and parks services are permitted | ||
117 | 5012-50120 | Sea and coastal freight water transport | |||
118 | 5022001 | Internal Water Transportation of Goods | |||
119 | 7730016 | Commercial Ships Rental | |||
120 | 5222002 | Ship Piloting and Towing | |||
121 | 5222007 | Marine towing of boats and jet ski | |||
122 | New | Activities of holding companies related to intellectual property |
NEGATIVE LIST
Sectors restricted from 100 per cent foreign ownership appear on a ‘negative list’.
They include:
- Oil exploration and production
- Investigation, security, military (including manufacturing of military weapons, explosives, dress, and equipment)
- Banking and financing activities
- Insurance
- Pilgrimage and Umrah services
- Certain recruitment activities
- Water and electricity provision
- Fishing and related services
- Post, telecommunication and other audio-visual services
- Road and air transport
- Printing and publishing
- Commercial agency
- Medical retail (including pharmacies)
- Blood banks, quarantines and venom/poison banks
Note: The Ministry reserves the right to amend the list as per its discretion