The impact of the new UAE Companies Law on existing LLCs
Type
E-journal
Date
6 Jul 2015
Jurisdiction
United Arab Emirates
Taxonomy
General Company Law & Business Entities
Copyright
LexisNexis
Relevant company
Clyde & Co
Legal reference
Federal Law No. 2/2015
Analysis
The new UAE Commercial Companies Law (Federal Law No 2/2015) (the New Law) comes into force today, 1 July 2015. The managers/directors of any Limited Liability Company (LLC) that is incorporated "onshore" in the UAE should start to consider what changes may need to be made to the LLC's Agreement for Incorporation/Memorandum of Association (Memorandum) to bring it in line with the New Law. LLCs may also want to take advantage of a number of deregulatory changes in the New Law.
The grace period
Article 374 of the New Law allows existing companies a 12 month grace period in which they must "adjust their positions". This is taken to mean that an LLC will need to amend any conflicting provisions in its current Memorandum by 30 June 2016, unless that deadline is extended.