To accommodate the rapid expansion of the several Free Zones
established in the UAE and, for practical purposes, provide exemption
to companies or joint ventures established in specific areas, the
provisions of Article (2) of Federal Law Company Law No. (8) of 1984
which provides for the scope of application of the law were replaced
by the new provisions in Federal Law No. (15) of 1998.
The new amended Article (2) of this law retains the concept provided
in the previous Article (2) providing that the provisions of the
Company Law shall apply to commercial companies incorporated in the
State or that establish their main centre of activity therein, and to
all companies which establish their domicile therein.
However, the amended Article (2) excludes companies incorporated in
Free Zones in the UAE from its provisions. Regulations provided by
the concerned free zones shall apply to these companies except when
they are considered as UAE companies.
Except when companies are considered to be UAE companies, the new
Article (2) provides a further exemption stating that the provisions
of the Company Law shall not apply to oil companies operating in the
different fields of oil and gas industry, as well as companies
operating in various aspects of electricity, gas, water purification.
The Council of Ministers is also authorised in accordance with the new
provisions to issue decisions to provide companies with such exemption
from the provisions of the Company Law or to provide for this
exemption in special provisions in companies Memoranda and Articles of
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