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A Wish List of what the new
Federal Companies Law should include from a practising
law firm in the United Arab Emirates.
If I am to
imagine that we have discretion to include everything
that we wish to have in the new Companies Law, it will
include but not be limited to the following:
1.
The Companies Law will have three main types of
legal entities viz. public joint stock company, limited
liability company and partnership.
2.
The Companies Law will have a supplementary
regulation that deals with liquidation and bankruptcy of
each type of these legal entities in a simplified
manner.
3.
The Companies Law will have a detailed section
that deals with directors’ rights, liabilities and
obligations and will include serious penalties for
directors’ gross negligence or gross misconduct.
4.
The Companies Law will allow flexibility in
shareholding with the minimum of one and no limit for
the maximum of public joint stock companies.
5.
The Companies Law will not have any restriction
other than an independent evaluation from a recognised
third party in relation to the following:
(i)
in kind contribution to the capital;
(ii)
value of shares for the purpose of the rights
issue;
(iii)
evaluation of the assets of the company
especially the in kind contribution for the purpose of
converting a company from private to public.
6.
The Companies Law shall allow and permit
companies to have a share option scheme for its
employees to organise such a scheme.
7.
The Companies Law should permit for two classes
of shares with different powers, voting rights, etc.
8.
The Companies Law should have a detailed section
that deals with convertible bonds whereby companies can
convert bonds into shares subject to certain terms and
conditions.
9.
The Companies Law should leave the restriction in
the percentage of shares that should be offered to the
public to the financial market and not interfere in the
free flow of the shares.
10.
The Companies Law should make clear exemptions to
the pre-emption rights of the shareholders for any
further increase in the capital of the company. This
increase is especially to be granted to the employees of
the company utilised for the purpose of merging or
acquiring a third party’s business, etc.
11.
The Companies Law should deal with the pledge of
shares of a limited liability company, partnership and
public joint stock company and organise this
relationship in a professional manner including the
registration and deregistration of such pledges for
banks and financial institutions and third parties.
12.
The Companies Law should deal with the protection
of minority shareholders for all types of entities. | 
