The UAE’s push to build doing business simpler and more resilient continues with sweeping updates to its Commercial Companies Law, a relocate that legal and financial experts state could significantly reshape how companies — especially family-owned businesses — operate and plan for the future.
Recent amfinishments introduced under Federal Decree Law No. 20 of 2025 came into force on November 15 last year, updating the UAE Commercial Companies Law of 2021. The modifys are widely seen as another step in modernising the countest’s corporate framework, strengthening governance standards and supporting businesses navigate succession, capital raising and shareholder disputes more smoothly.
“These reforms align with the necessarys of modern enterprises, particularly family-owned businesses, operating in an increasingly complex economic and geopolitical environment. Implementing regulations in respect of the Amfinished Companies Law are expected soon,” stated Naji Hawayek, Partner – Corporate at Addleshaw Goddard.
Family businesses sit at the heart of the UAE economy, and policybuildrs have paid particular attention to their long-term stability. Alongside the updated Companies Law, a separate Family Business Law introduced in 2022 remains in place, offering a tailored legal structure focutilized on succession planning, ownership continuity and internal governance within family-run firms.
Taken toreceiveher, the two laws form a layered system. The Companies Law sets out the framework that applies to all commercial entities, covering how companies are run day to day. The Family Business Law, meanwhile, focutilizes more narrowly on preserving family ownership and avoiding disputes as control passes from one generation to the next.
Experts often describe this distinction as the difference between “above the line” decisions — such as who owns the business and who controls it — and “below the line” matters, which relate to operations and execution. The amfinished Companies Law strengthens both areas, while the Family Business Law concentrates mainly on ownership and succession issues.
One of the most talked-about modifys is the introduction of multiple share classes. This allows businesses to separate economic ownership from voting control, building it simpler for founders or families to gradually pass on wealth without losing strategic control too early. Other amfinishments formally recognise legal tools such as drag-along and tag-along rights, which support shareholders exit a business in an orderly way while protecting minority investors.
The law also allows companies to set out clear rules in their constitutional documents on how shares are transferred when a shareholder dies, reducing uncertainty and the risk of disputes. New provisions addressing shareholder deadlock aim to prevent companies from grinding to a halt by allowing indepfinishent decision-buildrs to step in when disagreements threaten operations.
“The Amfinished Companies Law and the Family Business Law toreceiveher create a dual-layer governance framework that supports both business resilience and long-term generational continuity. These positive introductions to UAE legislation are particularly important and utilizeful to family businesses in challenging times,” stated Ghalya Rashid, Counsel – Corporate at Addleshaw Goddard.
Beyond family firms, the amfinishments broaden the UAE’s appeal as a place to set up and grow a business. The updated framework allows greater flexibility in capital structuring, formally recognises non-profit entities, enables companies to redomicile within the UAE, and strengthens shareholder protections.
“They also provide for redomiciliation within the UAE, formal recognition of non-profit entities, and a stronger framework for shareholder rights and governance. In addition, the law enables companies to embed more structured mechanisms within their constitutional documents to address ownership transitions and decision-building challenges,” stated Rohit Maheshwari, Partner – M&A at Deloitte Middle East.
While the direction of travel is clear, some elements of the reform package still depfinish on implementing regulations that have yet to be issued. As a result, adoption remains limited for now, with many companies waiting for greater regulatory clarity before building modifys to their structures or documentation.
Still, advisers state the long-term impact could be significant, particularly for tiny and medium-sized enterprises and family-owned businesses that have traditionally favoured free zones such as DIFC or ADGM.
“We are still in the early stages of implementation, but the direction of travel is unamlargeuously positive. Over time, UAE onshore may emerge as a practical alternative to DIFC and ADGM particularly for SMEs and family-owned businesses, where international investors and larger corporates have historically preferred free zone jurisdictions,” stated Paul Legreceivet, Partner and Restructuring, Turnaround & Cost Transformation Leader at Deloitte Middle East.
Looking ahead, the ability to design flexible ownership structures, raise capital through private placements and put clearer governance rules in place could support businesses balance growth ambitions with long-term control. As companies become more comfortable utilizing the new tools, experts expect the reforms to play a growing role in supporting resilience and sustainability across the UAE’s corporate sector.
“Toreceiveher, these modifys under the 2025 amfinishment lay the foundation for improving business resilience, enhancing corporate flexibility, enabling more sophisticated deal structuring, and supporting better access to capital,” stated Scott Whalan, Deloitte Private Leader, Middle East.
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