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Private shareholding companiesAE,C?paid-up capital surges to Dh117b.

Summary: DUBAI u The paid-up capital of private shareholding companies in the UAE surged to Dh117.14 billion with the addition of 15 new firms in 2009, the Ministry of Economy said on Thursday.

The growth in the number of private shareholding companies "indicates robust economic activity and continuing confidence in the local business environment," said the ministry.

A private shareholding company, which must have a minimum of three shareholders and a minimum capital of Dh2 million, cannot offer share to the public under the UAE existing Companies Law, which is soon to be replaced by a new law that is expected to give more shareholding rights to foreigners. "The very fact that the UAE private sector continued on the growth track even during such difficult times proves the strength of our economic fundamentals," said Mohammed Ahmed bin Abdul Aziz Al Shihhi, Director-General of the Ministry of Economy.

In spite of the global economic downturn the UAE remains focused on offering effective legislation to protect investors and ensuring a robust economic environment for investments, he said. "The Ministry of Economy is committed to strengthen this focus and enhance growth by facilitating economic activity and reinforcing investor confidence, thus fulfilling our commitment to the economic development goals set forth in the UAE Vision 2021," Al Shihhi added.

In 2007, the Ministry of Economy developed a special regime for the 'Governance Regulations of Private Shareholding Companies' to create a set of regulations, standards and procedures that achieve institutional discipline in corporate management in accordance with global standards and techniques.

According to the ministry data, the number of private shareholding companies in the UAE reached 134 as of December 31, 2009.

Out of a total of 15 private shareholding companies that were newly registered last year, nine were investment companies while two each were from real estate and finance and the remaining one from the services sector, the ministry said in a statement.

"Together the new companies registered in 2009 accounted for a capital of Dh1.338 billion taking the total paid-up capital of private shareholding companies in the country to Dh117.14 billion and total capital to Dh122.39 billion," it said. As major contributor to the national economy, private shareholding companies operate in almost all critical sectors in the UAE including finance, investment, services, industry, real estate, and utilities.

Abu Dhabi had 72 private shareholding companies as 2009 came to a close, while Dubai had 47 and the emirates of Sharjah, Ras Al Khaimah, Ajman and Fujairah together had 15.

Under the existing Companies Law, three types of licences are issued, also including public shareholding companies and limited liability companies.

Unlike private shareholding companies, public shareholding companies should offer 55 per cent of shares to the general public. The minimum amount of capital for a public shareholding company is Dh10 million, of which a minimum of 25 per cent must be settled on subscription. A limited liability company can be formed by a minimum of two and a maximum of fifty persons. Shareholder liability is limited to the value of shares held in the company's capital.

A[cedilla] issacjohn@khaleejtimes.com

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Publication:Khaleej Times (Dubai, United Arab Emirates)
Geographic Code:7UNIT
Date:Apr 9, 2010
Words:535
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