UAE Law and Practice Contributed by: Ahmed Ibrahim, Malack El Masry and Maryam Quadri, IN’P IBRAHIM .N. PARTNERS
• more than ten years: a minimum notice period of 90 days. Employment matters form a critical component in any corporate acquisition within the UAE. It is also worth noting that only within the context of a share transaction or a merger would employees automatically transfer by virtue of the transaction. In the case of an asset transfer, employees would tech - nically need to have their contracts terminated and be re-hired by the acquiring entity. Their rights and obligations are in practice regulated by virtue of a con - tractual arrangement. 2.6 National Security Review There are no specific requirements within the context of an M&A transaction for managers/directors to go through security clearance to be appointed. In some instances there is scrutiny in relation to authorised signatories. However, as a general rule, the authorities can intervene on account of any violation of public policy or any threat to national security. 3. Recent Legal Developments 3.1 Significant Court Decisions or Legal Developments On 29 December 2023, Federal Decree-Law No 36 of 2023 on the Regulation of Competition came into force, which has significant implications for merger control regulations. While the implementing regula - tions are yet to be issued, the Cabinet issued, on 20 January 2025, Ministerial Decree No 3 of 2025 clari - fying economic concentration and dominant position criteria (see 2.4 Antitrust Regulations ). A Dubai Court of Cassation set a unique prece - dent regarding the first mandatory tender offer and squeeze-out in relation to one of the leading public joint stock real estate developers in the UAE. As a background, an acquirer who acquires 90% plus 1% or more of the total share capital of a publicly listed company may apply to the CMA for approval to force the remaining minority shareholders to sell or swap their shares to the acquirer within 60 days of the date of the final settlement of the primary offer. The minor -
ity shareholders can object and take the matter to court; however, the mandatory acquisition will not be suspended save by court order. The articles of association of the publicly listed com - pany must permit the mandatory acquisition for it to be valid. In the present case, the real estate publicly listed company had amended its articles through a general assembly resolution to include provisions related to a mandatory offer. While the offeror made its manda - tory offer in line with the applicable rules and regula - tions, a shareholder holding less than 5% of the share capital of the public company objected to the general assembly resolution approving the amendment to the articles. The grounds of the shareholder’s objections included that: • the resolution failed to comply with applicable pro - cedural requirements (which were in fact applicable to a board resolution); • the mandatory acquisition value represented an unfair offer to the shareholders; and • mandatory acquisition was only issued in favour of the majority shareholders. The court rejected the arguments of the minority shareholder, noting that: • the minority shareholder did not qualify to chal - lenge the resolution on account of not holding at least 5% of the shareholding; • any objection to a general assembly resolution has to be carried out in accordance with the prescribed procedural rules, including requesting the author - ity to stop the execution of the general assembly resolution within three days of the passing of the resolution; and • whether the procedure for objecting to a board res - olution had been followed or not was not relevant in this case since the subject matter was a general assembly resolution. The Dubai court’s decision is a significant judgment regarding the difference between challenging a share - holder’s resolution (that allows for a mandatory acqui -
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