Federal Decrees Introduces UAE Commercial Companies Law Changes

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2 months ago

Federal Decrees Introduces UAE Commercial Companies Law Changes

Federal Decree Law No. (20) of 2025 (the Amendment) introduces a series of targeted but meaningful changes to the UAE Commercial Companies Law (Federal Decree Law No. (32) of 2021) (the CCL). While several of the amendments aim to refine the existing framework, others materially expand the range of tools available to onshore UAE companies, reduce certain practical constraints between mainland and free zone regimes (including by clarifying the application of the CCL to free zone branches and representative offices operating onshore), and seek to strengthen the legal infrastructure underpinning acquisitions, exits, and minority investments.

These reforms affect not only how UAE businesses are structured and reorganised, but also how transactions are designed, documented and implemented. In particular, the Amendment aims to enhance statutory deal mechanics, introduce greater flexibility in managing ownership transitions and exits, and expand the options available for pre- and post-transaction structuring.

This GT Alert considers the Amendment from both a corporate structuring and M&A perspective. Given the breadth of the changes, the analysis below first addresses those developments most relevant to corporate structuring decisions, before turning to their implications for transaction design, execution risk, and deal sequencing in practice.

Key Takeaways

Taken together, the Amendment reflects a legislative intent to make onshore UAE companies more flexible and sophisticated across the full corporate and transactional lifecycle.
Complementary reforms that enhance onshore structuring and transactional optionality supports redomiciliation with continuity of legal personality. In particular, enhanced constitutional flexibility (including the ability to embed drag along, tag along, and succession mechanics) brings the onshore framework closer to international practice and may, in appropriate cases, reduce the need to rely on alternative holding jurisdictions solely to achieve workable majority-minority arrangements.
At the same time, while the Amendment strengthens the statutory footing for certain exit mechanics, some of the bespoke rights and remedies commonly used in minority investment structures may continue to be addressed contractually. As regulatory practice, notarial processes, and market practice may shape implementation, careful structuring and drafting will remain essential.
Overall, the Amendment materially expands the range of credible structuring and transaction options available in the UAE market, providing corporate groups, founders, and investors with a potentially more adaptable legal platform for growth, investment, and exit.

Continue reading the full GT Alert.

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