Positive List – FDI Law of 2018 – UNITED ARAB EMIRATES

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	Use of latest technology in the production process Achieve high added value Contribute to the field of scientific research and development, Meet the requirements of the licensing authorities in the country
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	Use of latest technology in the production process Achieve high added value Contribute to the field of scientific research and development, Meet the requirements of the licensing authorities in the country
21	11	Manufacture of beverages (except) (1101) Distilling, rectifying and blending of spirits (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, perfumes and toilet 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	According to regulations in force
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

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HOW WE CAN HELP?