Afridi & Angell, in association with the Association of Corporate Counsel Middle East, provided a high-level overview and update on two trending topics in the UAE, the 100 per cent foreign-owned companies and restrictive covenants.
An update on the FDI rules on 100 per cent ownership by foreign nationals of UAE licensed and registered companies (which came into effect on 30 March 2021 pursuant to Federal Decree-Law 26 of 2020)
Bashir Ahmed (partner) and Abdus Samad (senior associate) discussed how the new ownership structure impacts on the incorporation process and what options companies under the previous ownership structure (with the 51 per cent local shareholder) have should they choose to shift to the 100 per cent ownership structure. The discussion also touched on the categories of activities that are open to 100 per cent foreign ownership as well as a factors to take into consideration when choosing between free zone companies and onshore 100 per cent foreign-owned companies.
An overview of restrictive covenants in employment contracts and especially in the context of conspiracy and team moves
Employee restrictive covenants (or clauses which prevent an employee from certain acts such as joining a competitor for a period of time) are important tools in protecting business interests in an increasingly competitive market and in ensuring the stability of a talented workforce.
Afridi & Angell has recently advised on a number of high value team moves and conspiracy cases in the DIFC and on-shore Dubai, which seem to be on the rise in the UAE, involving enforcement of employees’ restrictive covenants and emergency preventive remedies.
Stuart Walker (partner) and Sulakshana Senanayake (senior associate) discussed the scope of restrictive covenants and how employers can mitigate the risk of an employee breaching such restrictions. Stuart and Sulakshana will also discussed the enforceability of restrictive covenants and potential remedies.