Insights

UAE Companies Law Amendments 2025 – Key changes and practical implications

Legal Development 11 December 2025 11 December 2025
Middle East
Regulatory movement
Commercial

Federal Decree Law No. 20 of 2025 introduces significant amendments to the UAE Commercial Companies Law 2021 (the Law), with effect from 15 November 2025. In this briefing we provide a summary of the key changes and their practical implications.

These reforms modernise the legal framework, align it with international standards, and introduce new tools for shareholder arrangements, capital structuring, governance, and corporate mobility.

The Law is a major step forward for the UAE’s corporate sector, aiming to strike a balance between flexibility and oversight. It introduces useful new mechanisms that can make onshore UAE companies more attractive to investors and easier to manage, while also plugging some gaps (like deadlock resolution and corporate mobility) that previously required workaround solutions. With thoughtful implementation and careful navigation of the remaining uncertainties, in-house counsel and business leaders can use these reforms to better structure joint ventures, facilitate smoother exits, strengthen governance, and protect shareholder value.

Summary Table of Amendments and Implications:

Amendment	Practical Implications
Free Zone Companies	Clarifies onshore compliance; confirms UAE nationality status.
Not-for-Profit Companies	Enables formal structuring of social ventures; awaiting regulations.
Drag-Along / Tag-Along Rights	Enhances exit mechanisms; in practice may be limited by statutory pre-emption rights for LLCs.
Succession of Shares	Facilitates planning; court valuation may delay execution.
Multiple Share Classes	Enables tailored capital structures; regulations pending.
In-Kind Contributions	New rules to be issued on valuations for private companies; improves transparency.
LLC Governance Continuity	Allows third-party appointments to the board in cases of deadlock; ensures operational stability.
Re-Domiciliation	Preserves legal identity; facilitates strategic moves.
PJSC Conversion	Simplifies IPO preparation; removes procedural hurdles.
Private JSC Fundraising	Opens private placement route; subject to SCA rules