Replaces Articles 3, 5, 8, 9, 14, 17, 32, 76, 78, 85, 105, 118, 208, 266 and 275 of the Commercial Companies Law and adds Article 15 bis: permits single-person and non-profit companies, classes of LLC shares with different rights, transfer of a company's registration between mainland and free zones, and covers free-zone branches operating onshore.
Federal Decree-Law No. 20 of 2025 is the first substantive amendment of the Commercial Companies Law, Federal Decree-Law No. 32 of 2021. Issued on 1 October 2025 on the proposal of the Minister of Economy and Tourism, it takes effect the day after publication in the Official Gazette (Article Four). Article One replaces Articles 3, 5, 8, 9, 14, 17, 32, 76, 78, 85, 105, 118, 208, 266 and 275; Article Two adds Article 15 bis; Article Three repeals conflicting provisions. The official text is in Arabic only.
The scope articles are rewritten for the free zones. New Article 3 applies the law to companies established in the State, to foreign companies operating or managed in the State with their branches and representative offices, and to the onshore branches and representative offices of free-zone and financial free-zone companies. New Article 5 keeps free-zone companies outside the law on matters their own zone rules cover, but where zone legislation allows onshore activity they may open branches or representative offices inside the State subject to the law. New Article 9(3) gives every company established in the State, including in free zones, UAE nationality.
New Article 8 adds two exceptions to the two-person rule: a company may be formed or owned by one person, and a non-profit company may be formed whose net profits are reinvested rather than distributed, under a Cabinet resolution. New Article 14 keeps the Arabic, attested memorandum, allows electronic attestation, and lets LLCs and private joint-stock companies write drag-along and tag-along rights and a mechanism for a deceased partner's shares into the memorandum.
New Article 76 lets the Cabinet set a minimum LLC capital, requires shares to be paid in full on incorporation, and allows the memorandum to divide shares into classes with different values, voting rights, redemption, profit or liquidation priority, each class recorded in the commercial register. New Article 78 lets partners agree the value of in-kind contributions subject to the authority's approval. New Article 85 has a manager's resignation take effect 30 days after submission if not decided, requires notice to the authority within 30 days of the expiry of an appointment, and lets an expired board carry on for up to 6 months.
New Article 32 allows private placements by private joint-stock companies under SCA rules, Article 208 lets the Cabinet create other share classes, Article 266 keeps the one-year lock-up on private joint-stock shares with exceptions, and Article 275 lets a company convert to any other form, including a cooperative, with continuity of legal personality.
New Article 15 bis allows a company, by special resolution, to transfer its registration between competent authorities and between a free zone and the mainland in either direction, provided both registers allow it, no annotation blocks it, both authorities consent and the decision is published; the Cabinet will set the rules for financial free zones. Status: in force.
All mainland companies under the Commercial Companies Law, foreign companies with UAE branches or representative offices, free-zone and financial free-zone companies that open branches or offices onshore or move their registration to the mainland, their partners, shareholders, managers and boards, and the licensing authorities, Ministry and SCA that register them.
| Article 3 | Replaced: the law applies to companies established in the State, foreign companies operating or managed in the State with their branches and representative offices, and branches and representative offices of free-zone and financial free-zone companies operating outside the zone and inside the State. |
| Article 5 | Replaced: free-zone companies stay outside the law on matters their zone rules cover, but where zone legislation permits onshore activity they may open branches or representative offices inside the State subject to the law. |
| Article 8 | Replaced: a company may be formed or owned by one person, and a non-profit company may be formed whose net profits are reinvested rather than distributed, under rules the Cabinet will issue. |
| Article 9 | Replaced: the five permitted forms are kept; every company established in the State, including in free zones and financial free zones, carries UAE nationality. |
| Article 14 | Replaced: the memorandum must be in Arabic and attested, in person or electronically; LLC and private joint-stock memoranda may include drag-along and tag-along rights and a mechanism for a deceased partner's shares with court valuation on disagreement. |
| Article 15 bis | Added: a company may transfer its registration between competent authorities, and between a free zone and the mainland in either direction, by special resolution with both authorities' consent, no blocking annotation and publication; the Cabinet sets the rules for financial free zones. |
| Article 76 | Replaced: the Cabinet may set a minimum LLC capital; shares are paid in full on incorporation; the memorandum may create share classes with different values, voting, redemption, profit or liquidation rights, each recorded in the commercial register. |
| Article 78 | Replaced: in-kind contributions to an LLC are valued by an approved valuer at the contributor's cost, or by agreement of the partners approved by the authority, with the contributor paying any overvaluation in cash. |
| Article 85 | Replaced: a manager's resignation takes effect 30 days after submission if not decided; the company notifies the authority within 30 days of the expiry of an appointment and replaces the manager; an expired board may continue for up to 6 months. |
| Article 266 | Replaced: private joint-stock shares may not be transferred before accounts for one financial year are published, with exceptions for transfers between shareholders, inheritance, bankruptcy and court orders, a Minister's power to vary the period and an exemption for shares placed privately and listed. |
| Article 275 | Replaced: a company may convert to any other form, including a cooperative, keeping its legal personality; conversion to a joint-stock company proceeds without a new incorporation application, with a general meeting within 30 days of registering the new form. |
| Article Four | Published in the Official Gazette and in force from the day following publication. |
None in the amendment itself; breaches of the amended articles are fined under the administrative penalties schedule in Cabinet Resolution No. 102 of 2022.
This amendment changes the structuring menu we offer. An LLC can now carry preference, non-voting or redeemable share classes written into its memorandum and recorded in the register, which lets us give investors and family members different economic and voting rights without a joint-stock conversion or an offshore holding layer. Drag-along, tag-along and deceased-partner mechanisms can sit in the memorandum itself rather than only in a shareholders' agreement. Article 15 bis gives our free-zone clients in DMCC, RAKEZ, IFZA and Meydan a route to move the same company onto the mainland, or the reverse, with continuity of personality, and we check the receiving register's rules and any annotations before a client commits. Free-zone clients that already serve onshore customers now need a branch under new Articles 3 and 5 where their zone permits onshore activity, and we review that position in every renewal. Single-owner and non-profit companies await the Cabinet rules before we rely on them.
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