(MENAFN- Khaleej Times) New laws and amendments will boost the confidence of the business community and attract more investment into the country A general view of downtown, following the outbreak of the coronavirus disease (COVID-19), in Dubai, United Arab Emirates, March 26, 2020. REUTERS/Christopher Pike by Muzaffar Rizvi
Sun 28 Nov 2021, 7:02 PM
The raft of new laws and legislative amendments to the commercial law, data protection, intellectual property rights protection and ease of digitisation will boost the confidence of the business community and attract more investment into the country, experts say.
Industry specialists, analysts and corporate executive said new reforms for commercial companies, online security, trade, copyright, residency, and social issues will pave the way for a sustainable growth in years to come.
Saad Maniar, senior partner at Crowe said the UAE continues to bring reforms to enable business thrive in this dynamic business environment.
'These laws reforms will enhance justice and also improve efficiency, thereby positioning UAE as one of the most attractive business jurisdiction,' Maniar told Khaleej Times on Sunday.
He further said that some business quarters may see these reforms as a burden of compliance as they will have cost implications too.
'Ultimately in the longer period, these laws and regulations will contribute to increase in public trust and will protect businesses and individuals against various risk,' he said.
Ushering into a new era
Atik Munshi, managing partner, FinExpertiza UAE, said the UAE government is on a path of ushering a new inclusive era and the reforms or changes in the UAE legal structure is a part of such change. He said the underline idea is to encourage more international participation in the UAE growth model and attracting more talent, investors and residents into the UAE.
“The progressive amendments to the commercial law, data protection, intellectual property rights protection, ease of digitisation will be sure to boost the confidence of the business community while the legal changes in the laws affecting personal status would likely be perceived as more freedom for individuals,” Munshi told Khaleej Times.
“In my view, this country, shall gradually be very similar to any European or US state as far as laws are concerned. It is likely that further changes and amendments will come in the near future. Overall it will certainly boost local consumption and economy as the size of the local population increases over a period of time,” he said.
Pankaj Mundra, co-founder and chairman 360tf, said these reforms will lead to increased liquidity in the UAE market and grant confidence to banks, factoring companies and new fintechs focusing in this space.
“As a long-term resident and economic community member, the wide-ranging UAE law reforms are critical stepping stones in achieving the development objectives of this great nation. Among all the pathbreaking reforms announced, as a trade finance professional the one that is the most cutting edge is the first federal regulation addressing factoring and assignment of receivables.
He said factoring is a key source of financing and growth for SMEs worldwide and an integral part of corporate treasury and finance operations. Globally trade receivables in excess of $3 trillion are financed by factoring companies with China and France leading the pack.
“Statistics indicate that the UAE financial institutions financed approximately $7 billion worth of receivables backed working capital last year, a number which is expected to grow robustly given the new regulations and reforms,” Mundra said.
Step in the right direction
Safdar Badami, managing director, Al Muqarram Group, said the announcement of new laws and legislative amendments by the UAE government is a step in the right direction and timely.
“The UAE is the regional economic hub and these new laws will ensure that mission-critical processes that fuel business operations are streamlined. These amendments will also ensure that the UAE remains the preferred investment destination in the region, which will pave way for its much-needed economic growth and development agenda,” Badami said.
Best global practices
Bal Krishen, chairman and CEO, Century Financial, said any company that is doing business is always looking forward to operate in an environment which has a modern legal structure. He said the new reforms enacted at the Federal level adopts the global best practices.
Additionally, he said the government also take into account the technological transformation that has taken place in the aftermath of the pandemic. For example, the digital signatures have been legalised. The protection given to trademarks and intellectual property will give multinational corporations to confidently operate in UAE. Also, noteworthy is the data protection law since data is the point of contention between various international jurisdictions. US in between had banned Chinese company Tik Tok on suspicions that the latter was misusing the data of its citizens.
“Data is the new oil and a law protecting that is indeed welcome. UAE a global finance, tourism and trade hub will able to reinforce its reputation and compete for new business with these new set of reforms,” Krishen said.
Online security law
Amine Sadi, regional sales manager for the Middle East, North Africa and Turkey at Milestone Systems, said the change to the online security law is a welcome move and will help individuals, companies and the nations in safeguarding itself against cyber-crime.
“Video protection will continue to play an increasing role in combating these crimes. Open platform software such as Milestone Systems will make a telling difference in cybersecurity for businesses in protection against attacks that disrupt operations and cost the companies heavily financially and to their reputation. This change is likely to amend security best practices in the near future,” Sadi said.
Electronic signature solutions
Ola Lind, director, FTFT Capital, said electronic signature solutions will help in storing, tracking and authentication of the document which would reduce costs and bring more certainty to legal processes.
“Holistically speaking, strengthening the trustworthiness of the electronic signature solution is critical to digital transformation for companies and the nation. This move will certainly allow organisations to be more agile, efficient while saving costs and time. As blockchain adoption increases the move will allow for quicker verification and transparency for strengthening security while affording higher attention to customers,” Lind said.
Protecting trademarks, IPRs
Ayman Youssef, vice-president, Coldwell Banker UAE, welcomed the move to protect trademarks, industrial property rights and intellectual rights and said it will pave the way for a sustainable growth.
“In order to foster an innovation led economy it is very important to protect intellectual rights and this is exactly what the latest laws set by the Government does. If you don't protect the rights of the people who initiate new ideas and patents, you cannot promote growth. Therefore, on the business front, opening the doors for foreigners to do business onshore, the new trademarks, industrial property rights and the copy right law will render the protection and security needed to attract more investors and businesses into the country,” Youssef said.
“Allowing investors and entrepreneurs to establish fully onshore companies in all sectors is a great move towards achieving economic diversification and knowledge-based economy,” he added.
On the civil rights front, he said the UAE is promoting diversity and inclusion and opening the doors for FDI and providing a legal framework to protect all the rights.
“All the FDI investors considering UAE, are provided with flexibility and protected rights, which accommodates their personal and business requirements. The biggest advantage of the new law is that it protects women, minors and people with determination as well as offers flexibility to accommodate other cultures and international preferences, this in the longer run will benefit the country from a socio-economic stand point too,” he said.
Nation building move
Nitin Agarwal, president, Hundred, said this is another very comprehensive and important step towards nation building by UAE Leaders. He said the new laws will provide a confidence boost to SMEs, creative talents and to the Institution for doing business in UAE.
“These laws will further support the rights of residents, both individuals and companies. They will help to push the digital first agenda and make the services better and faster both in private and public sectors,” Agarwal said.
Lower transaction cost
Mareva Koulamallah, head of Marketing and Communications Middle East & Africa, Acronis, said from a cyber protection perspective, the new laws will help to have electronic tracking so that organisations are not worried about forgeries and password leaks.
“In the grand scheme of things, client retention may also improve as a secure transacting platform will become a prerequisite, especially given the frequency of customer data leaks and ransomware attacks,” he said.
“From a legal perspective, the new laws will ensure increased contracting speed, enhanced security, and lower transaction costs. Creating a good secure environment means it's not as easy to duplicate documents etc, which brings more certainty to the legal process and more importantly it reduces cost,” Koulamallah said.
Deep and positive impact on businesses
Professor Paul Hopkinson, associate head of the School of Social Sciences and Academic Lead for Heriot Watt Online at Heriot-Watt University Dubai, said this is the largest legal reform in the 50-year history of the UAE and will have a deep and positive impact on businesses in the region in several ways.
For example, recognising digital signatures will make it easier to complete commercial transactions. Similarly, the new Commercial Companies Law which now allows investors and entrepreneurs to startup and maintain complete ownership of onshore companies will naturally result in higher levels of investment in businesses in the region, which will in turn intensify the drive towards economic diversification. The latest cybersecurity and data protection laws as well as the updated federal law around trademarks are tighter than before and will benefit both businesses and consumers, he said.
“We welcome these new decrees and on the occasion of the UAE's 50th National Day, there could be no better gift from the government to the businesses in this region,” he said.