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The UAE Commercial Companies Law amendments in Federal Decree-Law No. 20 of 2025 change how founders can structure share capital, convert a company and move between jurisdictions. The Ministry of Economy and Tourism, in a statement published on 6 January 2026, says the decree amends 15 articles of Federal Decree-Law No. 32 of 2021 and adds one new article on transferring a company’s commercial register registration. Several of the changes still depend on Cabinet or ministerial decisions, so founders should treat them as a framework rather than a finished rulebook.
Contents
- More flexible share structures
- Converting and moving a company
- Lock-ups, exits and shareholder rights
- What it means for a founder
- What happens next
- Questions on the amendments
More flexible share structures
According to the ministry, LLCs can issue multiple quota classes and joint stock companies (JSCs) can issue multiple share classes subject to conditions; previously this was limited to public JSCs by Cabinet decision. Examples it lists include dividend shares, priority capital-recovery shares, preferred shares, shares with varying nominal values and restricted shares. The categories will be set by Cabinet decision. The law firm Kayrouz & Associates, in its own summary, likewise notes that the new share classes await implementing regulations.
Converting and moving a company
The ministry says companies can convert between legal forms while keeping their legal personality, and can transfer their commercial register registration between emirates, free zones and financial free zones without liquidation or re-incorporation. Conditions include compatible registration systems, no legal impediment, required approvals and publication of the transfer decision. It also says free zone and financial free zone companies can operate on the mainland through branches or representative offices.
Lock-ups, exits and shareholder rights
The lock-up on share disposal for private JSCs drops from two years to one, and a ministerial decision can reduce or waive it; private JSCs are exempt during a private placement or financial market listing. The ministry adds that drag-along and tag-along rights, forced-sale provisions and prior sale agreements can be written into the articles of LLCs and private JSCs. A new non-profit commercial company form is also created, with rules to be set by Cabinet decision.
What it means for a founder
As an illustration, not advice: an Indian software founder running a free zone company who wants to sell to mainland customers could, under the framework, use a mainland branch rather than a new entity, and an investor-backed startup could use preferred shares once the Cabinet decisions are issued. Check the current position with a licensed UAE adviser and your free zone authority before restructuring. Our company formation service page and the report on the Saudi Arabia foreign investor rules give regional context.
What happens next
The ministry says company registrations and licences are expected to rise 10 to 15 per cent in the first year after implementation. That is the government’s own projection, not an independent forecast. Watch for the Cabinet decisions on share classes and the non-profit form, and for the ministerial decision that will set in-kind valuation standards for contributions of assets other than cash. The ministry also says the amendments apply to foreign companies operating in or headquartered in the UAE and to branches or representative offices of free zone companies on the mainland, and that existing and future companies, including those in free zones, keep UAE nationality. For a founder choosing between a free zone and the mainland, the practical point is that these structural options are now written into the main law, even where the detailed rules are still to come. Until implementing decisions are issued, ask your licensing authority in writing which provisions it is applying.
Questions on the amendments
Which law was amended?
Federal Decree-Law No. 32 of 2021 on Commercial Companies, by Federal Decree-Law No. 20 of 2025.
How many articles changed?
The ministry says 15 articles were amended and one added.
Can a company move between free zones and emirates?
The ministry says registration can be transferred between emirates, free zones and financial free zones without liquidation, subject to conditions.
What happens to the private JSC lock-up?
It drops from two years to one, and can be reduced or waived by ministerial decision.
Are multiple share classes available now?
The ministry says categories will be set by Cabinet decision, so check whether the decision has been issued.
Where do I start?
With your free zone authority or mainland licensing department, and a licensed UAE adviser.
Sources
- UAE Ministry of Economy and Tourism — Review of the Commercial Companies Law amendments. https://www.moet.gov.ae/en/-/ministry-of-economy-and-tourism-reviews-new-amendments-to-the-commercial-companies-law-and-their-pivotal-role-in-enhancing-competitiveness-of-the-uae-s-business-environment
- Kayrouz & Associates — UAE CCL amendments 2026. https://www.kayrouzandassociates.com/insights/uae-ccl-amendments-2026
Image: Dubai Marina skyline by CT Cooper, public domain, via Wikimedia Commons.
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