UAE Law and Practice Contributed by: Duncan Pickering, Nicola de Sylva, Sean Cope and Marta Almeida, DLA Piper LLP
Public Joint Stock Company (PJSC) Share capital is divided into negotiable shares of equal value. The nominal value of each share cannot be less than AED1 or more than AED100. Shareholders have liability limited to the value of their shares. A PJSC must have at least five founder members. Subject to implementation of the recent amendments to the Companies Law, UAE nationals must own at least 51% of the shares in the PJSC, and the founding members must subscribe for between 30% and 70% of the issued share capital. Private Joint Stock Company (Private JSC) A private JSC is similar to a PJSC but with certain differences, including:
A building completion certificate will not be issued if the building permit has not been complied with. Occupation of a building is not allowed without such certification. 5. Investment Vehicles 5.1 Types of Entities Available to Investors to Hold Real Estate Assets Various types of corporate vehicles are capable of holding real estate assets in the UAE. If the holding company of a real estate asset has foreign sharehold - ers, the company may only hold the real estate asset within a designated investment area. 5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity Limited Liability Company (LLC) Onshore LLCs established in the UAE (outside the free zones) have historically been subject to foreign investment laws which required at least 51% equity participation by UAE nationals. The UAE’s new Com - mercial Companies Law, which came into force on 2 January 2022 and further amended on 15 October 2025, contains no general requirement for equity par - ticipation by UAE nationals; however, certain activities have been designated as having strategic impact (for example, in the security and defence sector) and con - tinue to require prescribed levels of local ownership. JAFZA Offshore Companies An offshore/free zone company can be 100% foreign- owned. If the asset is to be wholly owned by foreigners (and therefore in a designated area), a DLD Direction in 2011 confirmed that the shareholders are permitted by the law to use a JAFZA offshore company only to pur - chase and register the land interest (regulated by the Jebel Ali Free Zone Authority in Dubai and “accepted” by the DLD), and foreign companies in other jurisdic - tions are no longer permitted to register land owner - ship interests. The issue becomes more complicated if the intention is for the company to develop the land and sell units, villas, etc. Specific advice must be sought in such circumstances.
• the minimum share capital is AED5 million; • the shares cannot be offered publicly; and • only two founder members are required.
The Companies Law provides that, unless specifically stated, all requirements that apply to a PJSC apply to a private JSC as well. Tax Implications Under the new CIT regime, income from immovable property derived by a legal entity, whether derived from sale or through leasing, will typically be subject to a 9% tax rate for “regular taxpayers” who are sub - ject to the standard tax regime (taxable income up to AED375,000 is taxed at 0%). Under the free zone tax regime, entities that are con - sidered qualifying free zone persons are eligible for a 0% CIT rate on certain types of income (ie, qualifying income), provided specific criteria are met. The regula - tions with respect to the free zone tax regime are rela - tively complex, but in essence, in a real estate context, only income from commercial properties located in the free zone may qualify for the 0% rate, provided the transaction is conducted with an entity registered within a free zone (ie, a free zone person). Conversely, revenue from residential properties does not qualify for the 0% rate. It is important to note that properties such as hotels, motels, bed and breakfasts, serviced apartments and similar establishments are
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