The United Arab Emirates established nearly 250,000 new businesses in 2025, with small and medium-sized enterprises owned by Emirati citizens experiencing a remarkable growth of 63 percent over the past five years, according to state media reports.
Economy and Tourism Minister Abdulla bin Touq Al Marri projects that new business formations will increase by 10 to 15 percent in 2026 as recent legislative changes take effect.
Since the Commercial Companies Law was enacted in September 2021, the UAE has attracted approximately 760,000 businesses, bringing the total number of companies operating in the country to more than 1.4 million, representing a 119 percent increase from mid-2021 levels.
Legislative amendments passed in December 2025 introduced significant flexibility for businesses operating across the country.
The updated regulations enable companies to transfer their registrations among the seven emirates and financial free zones, a move designed to streamline operations and reduce administrative burdens.
The reforms updated 15 articles within the existing legislation, addressing critical areas including ownership structures, sale and exit processes, and corporate governance protocols.
Al Marri emphasized that the UAE has become one of the first Middle Eastern countries to permit multiple quota classes for limited liability companies, a structure that many nations restrict exclusively to joint stock companies, particularly public entities.
The new framework allows businesses to move their registration from commercial registers across emirates, free zones, and financial free zones, creating a more fluid business environment.
According to Al Marri, these changes will substantially lower compliance and operational expenses for companies throughout the country.
The minister also highlighted the strong performance of the tourism sector, which has become a major economic driver.
Tourism’s contribution to the nation’s gross domestic product increased dramatically from 6 percent in 2021 to 15 percent by the end of 2025.
In monetary terms, tourism generated AED291 billion (approximately $80 billion) by year-end 2025, a remarkable 216 percent increase over four years.
Looking at broader economic indicators, Al Marri anticipates that the UAE economy expanded by 5 percent in 2025, with non-oil sectors playing a crucial role in this growth.
By the end of the first half of 2025, non-oil sectors accounted for 77.5 percent of economic activity, demonstrating the country’s successful diversification efforts away from hydrocarbon dependency.
These regulatory improvements represent the UAE’s ongoing commitment to enhancing its business environment and maintaining its position as a leading commercial hub in the Middle East.
The combination of streamlined registration processes, reduced operational costs, and flexible ownership structures positions the country to attract even more domestic and international investment in the coming years.
Source: https://www.agbi.com/law/2026/01/law-amendments-to-drive-uae-company-registrations-up-15/
