Knowledge & Opinions
19 Nov 2020

Abu Dhabi launches new FDI licence to boost foreign investments

Abu Dhabi has introduced a new Foreign Direct Investment (FDI) licence that allows foreign investors to hold 100 per cent ownership of their businesses within the Emirate of Abu Dhabi. MSI's Abu Dhabi law member Middle East Alliance provides further insight.

The new license further consolidates Abu Dhabi’s position as a global hub for investment and “ease of doing business”, creating the list of investment opportunities within various economic sectors and activities applicable for foreign investments will deliver a strong positive impact to the emirate’s investment environment Abu Dhabi's Department of Economic Development (ADDED) said that the new FDI licence targets businesses with capital ranging from Dh2 million to Dh100 million or even higher. The long-anticipated FDI licence, which is expected to have a far-reaching positive impact on Abu Dhabi’s business landscape, covers 122 different economic activities related to the agricultural, industrial and services sectors. This list indicates that the UAE is more inclined towards non-oil sectors and ensuring the most ideal way to protect the rights of foreign investors, following the directives of the Abu Dhabi Government in attracting foreign direct investments to the emirate”. This will encourage investors, spur business development for foreign companies as well as attract businesses in technology and advanced industries” that contribute to the emirate’s economic diversification policy. The issuance of the FDI licence is in line with the provisions of Federal Law No (19) of 2018 regarding Foreign Direct Investment Under the FDI Law, foreign investment above 49 per cent will not be permitted in sectors which appear on a “negative list”. The UAE Cabinet has the discretion to amend the “negative list” by adding or removing sectors. There are currently 13 sectors specified in the “negative list”, including banking, insurance, and commercial agencies. The procedures The procedures in securing the license are fast and easy through ADDED’s Abu Dhabi Business Center (ADBC), which only require a few key steps:
  1. Apply for a "foreign direct investment project" license
  2. Pursuing approval after fulfilling the conditions and completing the required documents and procedures
  3. Issuance of the license that should be marked with this sign: "Foreign Direct Investment.
Main permitted activities in Abu Dhabi are as follows: Industrial activities 
  • Industrial activities permitted under the licence include
  • Manufacturing of food and beverages products,
  • Clothing and leather production,
  • Wood and cork products,
  • Production of plastics and synthetic rubber in its primary forms,
  • Fertilisers, pesticides, and other agricultural chemical products.
Agricultural activities 
  • Planting of grains
  • Legumes
  • Fruits and citrus fruit
  • Activities that support crops and livestock production
  • Seed processing for live stocks reproduction
The list of service activities The list of service activities that can be practised with the licence include:
  • Accounting, services; and consulting auditing
  • Marine Transport
  • Architectural and engineering activities;
  • Contracting engineering consulting and maintenance services
  • Hospital, medical and dental clinics.
  • Veterinary activities;
  • Computer programming services;
  • Consultancy, research and development activities in science and technology,
  • Research and development of science and technology
  • Entertainment
The implementation of the FDI law in Abu Dhabi “contributes to achieving various objectives such as expanding the base of foreign investments; increasing the size of capital flows; enhancing and diversifying local production, and increasing the emirate’s exports of goods and services.  Further information please visit: https://added.gov.ae/Our-Initiatives/Foreign-Investment  

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