Paolo Soro

UAE New Commercial Companies Law amendments: All companies to comply by 30 June 2016

LLCs have to amendment its MOAs (Memorandum of Association) by the end of June 2016.

The New UAE Commercial Companies Law (CCL) (Federal Law No.2 of 2015) that was published in the Official Gazette on 31 March 2015 replaced the existing commercial companies law (UAE Federal Law No.8 of 1984) and, under its provisions, all companies must comply with the amendments by 30 June 2016.

In accordance with the requirements of the New CCL, in order to remain compliant. all existing companies must make certain amendments to their constitutional documents by the 30th of June 2016. Failing to do so will result to the company being dissolved.

The following are the key features of the New CCL:

-          An LLC can be managed by one of more managers, removing the previous limit (5) of managers that an LLC could appoint.

-          The date of birth and domicile must be added in the MOAs for individual shareholders while in the case of corporate shareholders, the date and place or registration must be included.

-          The quorum for general assemblies has been raised to 75% of shareholders.

-          Invitations to general assemblies can be communicated by any means agreed upon, with the minimum notice period being reduced to 15 days (from 21).

-          The shareholders of a company are allowed to enter into share pledge agreements either with other shareholders or with third parties.

-          The company’s name must appear on all contracts, documents, correspondence and application forms issued by the company.

-          Details of the shareholders of an LLC (including date of birth and mobile numbers) must be included in the introduction to the document (Articles), and not in later sections.

To ensure compliance with the New CCL, private companies must ensure that the Memorandum of Association has been properly amended and notarised, by 30 June 2016.

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