Under the new Commercial Transactions Law of UAE, the minimum age for starting or handling a business has been revised to eighteen years. According to the Ministry of Economy, the new law will help boost the business environment in the UAE enabling more individuals to start their own entrepreneurship.
The announcement of these new laws was made during a media briefing by the undersecretary of the MoE, Abdullah Al Saleh. Other than Al Saleh, several other dignitaries were present at the briefing including Ibrahim Al Zaabi, Assistant governor, of the Emirates Central Bank for Monetary Policy and Financial Stability; and Dr.Maryam Al Suwaidi, CEO of the Securities and Commodities Authority;
Ministry of Economy examined the new law’s main components and overall effects
Earlier the minimum age to conduct business in the UAE was 21 years and the new law brings the minimum age on par with international regulations. This move has multiple benefits like how the young generation can move in early into the world of business and its related aspirations.
Also, family businesses can think about succession and inheritance at an earlier stage now. Atik Munshi, Managing Director at Finexpertiza UAE, said that the minimum age drop will also create changes at the managerial levels and the board of directors at a number of different family-owned companies.
There have been other changes as well with regard to the eligibility of business trading under Article 18.2 of the new Commercial Transaction Law. The current age has been fixed to fifteen years as compared to the earlier age of eighteen provided the concerned party follows the new terms and conditions created by the resolution of the Cabinet and also on the recommendation from the Ministry of Economy. The earlier laws prevented anyone under the age of twenty-one from becoming the director of a firm or having the authority to sign any sort of business agreement.
The new law goes hand in hand with the vision of the wise leadership of the UAE which seeks to promote the young spirit of the nation and sees young people as the true assets.
On International Youth Day last year, His Highness Sheikh Mohamed bin Zayed Al Nahyan, the President of the UAE stressed the active role played by the young generation of Emirati women and men to empower and lead the country to a better future. He also said that the youth of today are highly capable and they continue to inspire the older generation by attaining success in all the fields in which they indulge.
The dependence on digital technology and the internet is another factor that has inspired the formation of a new Commercial Transaction Law in the Emirates. The new world order will be built on digital technologies and the knowledge of handling them with ease and effectiveness shall dictate the economic growth of any nation.
This is where the concept of ‘Digital Natives’ comes in. Digital natives are a generation of people who were born into and grew up under the pervasive culture of the Internet and other forms of digital technologies. So, in order to stride ahead in the tech industry sector, it is very crucial to give youngsters initial leverage in starting such businesses which will be beneficial to the tech industry of the UAE in the long run.
Luca Angiolilli, Head of Tax at Corporate Group observed that there is a huge number of young entrepreneurs the age of 18 and above in the entertainment and tech industry who have established successful business models around the world.
By reducing the minimum age for running a business, UAE has found a rare opportunity to attract these young minds to UAE and to encourage them to invest in the Emirates economy. This can be one of the prominent economic decisions that can guarantee long-term investment benefits and at the same time, create innovative business models with a global reach.
Here are some of the most important aspects of the new Commercial Transaction Law.
- The minimum age for handling business has been reduced to 18 from 21.
- A legal reference has been created for commercial transactions in banking institutions that will aid in investments and provide a better opportunity for growth for businesses.
- Under the new law, it is mandatory to obtain a license for regulating and establishing financial markets and it will strictly adhere to the legislation regulating securities in the UAE.
- More support has been provided to the Islamic banking sector in the country and considers them as one of the main points of growth in the finance sector.
- The technology sector has been given special prominence and various measures have been taken to offer support in setting up these kinds of businesses.
On the whole, the new Commercial Transaction Law puts great emphasis on encouraging the young generation of UAE and recognizes the importance of investing in their spirit and enthusiasm to create new and inspiring business models. In the coming years, this new law would pave the way for a surge in the business environment of the Emirates providing a fresh perspective to the economy.