Article / 17 Mar 2023
A number of administrative penalties have been recently introduced following the issuance of a UAE Cabinet resolution. This sets out fines for non-compliance with the UAE Federal Decree by Law No. 32 of 2021 concerning commercial companies (New Companies Law).
The introduction of such a resolution strongly indicates that overseeing UAE Cabinets are taking a much stricter approach to company adherence with the New Companies Law.
| Non-compliance | Approximate penalty (AED) |
|---|---|
| Accounting register: Failure to maintain an accounting register |
15,000 |
| Trade name change: Failure to comply with a decision to change the trade name |
A monthly fine of 500 reaching a maximum amount of 5,000 |
| Ownership: Failure to have a required UAE national ownership percentage/ minimum number of Emirati board members, should the LLC carry out activities with strategic significance |
100,000 |
| Memorandum of Association (MOA): Failure to amend the company MOA to ensure it is in line with the New Companies Law |
A monthly fine of 500 reaching a maximum amount of 5,000 |
| Loss disclosure: Failure to call a general assembly should the company amount losses equal to 50% or more of its capital |
50,000 |
| Data access: Denying shareholders access to minutes of meetings, books and other specific company documents |
5,000 |
| Board meetings: Failure to invite a director or board member to a board meeting |
3,000 |
| Refusal of information/ misleading information: Refusal, concealment or failure to provide misleading information to authority inspectors |
5,000 |
| Share disposal: Disposal of shares in violation of the New Companies Law |
20,000 |
| General assembly: Failure to call an annual general meeting |
5,000 which increases to 10,000 if requested by the Ministry |