FEDERAL DECREE LAW NO. 37 OF 2022
CONCERNING FAMILY COMPANIES (BUSINESSES)

LAW NO. 37 OF 2022
ON FAMILY COMPANIES

The law on family enterprises, within the framework of UAE Corporate Laws & legislations, is critical to strengthen family businesses to guarantee the continuity of their gains and offer stable foundations. It gives them legislative assistance and a regulatory framework, allowing them to successfully pass on businesses from generation to generation.

The law demonstrates the UAE government’s eagerness to develop an integrated legislative system aimed at developing the business environment, the country’s capabilities, and its economic position by global shifts, particularly those related to organising governance rules, protecting partners’ and shareholders’ rights, facilitating FDI flows, and promoting corporate social responsibility.

The Federal Decree-Law delivers families in the UAE with another means to arrange their activities and plan for succession. It is the first Federal legislation produced in the UAE to address the regulation of family companies.

HIGHLIGHTS OF LAW NO. 37 OF 2022 ON FAMILY COMPANIES

The law on family enterprises is critical to strengthen family businesses to guarantee the continuity of their gains and offer stable foundations. It gives them legislative assistance and a regulatory framework, allowing them to successfully pass on businesses from generation to generation.

The law demonstrates the UAE government’s eagerness to develop an integrated legislative system aimed at developing the business environment, the country’s capabilities, and its economic position by global shifts, particularly those related to organising governance rules, protecting partners’ and shareholders’ rights, facilitating FDI flows, and promoting corporate social responsibility.

The Federal Decree-Law provides families in the UAE with another means to arrange their activities and plan for succession. It is the first Federal legislation produced in the UAE to address the regulation of family companies.

The “Concerning Family Companies” law is not a widely recognised or commonly referenced term in the context of laws and regulations. Family companies typically fall under the broader umbrella of commercial, corporate, or business laws in most jurisdictions.

 

ISSUER OF LAW NO. 37 OF 2022 ON FAMILY COMPANIES

In the UAE, each emirate often has its laws and regulations about various legal matters, including business-related laws. Family company laws, if enacted, are intended to govern family-owned businesses and their operations within a specific emirate.

 

WHO IS SUBJECT TO THE ‘CONCERNING FAMILY COMPANIES LAW’?

Family company laws, if enacted, are typically intended to govern family-owned businesses and their operations. However, the specific applicability of such laws may differ from one emirate to another.

Typically, the following groups are subject to the family company laws if they exist in a particular emirate:

  • Family-owned businesses.
  • Family members who are shareholders or owners of family-owned companies.
  • Those individuals who serve on the board of directors or hold management positions within family-owned companies.
  • Legal professionals, consultants, and advisors who provide services to family-owned businesses.
  • Government Authorities.

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