Legislation changes help businesses big and small

The new companies law includes provisions that are expected to help small business owners.

While many of the provisions within the new companies law will benefit bigger companies, some changes are expected to help out smaller enterprises, experts say.

Under the previous legislation some aspiring small-business owners struggled to pay a minimum Dh150,000 (US$40,835) of capital needed to launch their ventures.

"Funding is very important for entrepreneurs," said Jassem Mohammed Hassan Al Bloushi, the chairman of the Sharjah Tatweer Forum, which is hosting a conference for entrepreneurs this month.

The Government scrapped its Dh150,000 minimum capital requirement a little more than two years ago, said Lubna Qassim, the director of the economic legislations department at the Ministry of Economy. Still, a specific provision in the new law now clearly states it will not identify a set minimum amount of capital needed to set up.

"Raising the initial capital is not always easy for everyone," said Vishnu Deuskar, the managing director of Salvus Strategic Advisors, a business consultancy in Dubai.

"[The new law] will make it that much easier."

Small companies looking to create a local brand presence are also expected to benefit.

The new law entrusts the Registrar of Companies at the Ministry of Economy to supervise the record of brand names for different types of companies across the emirates "in order to avoid repetition among them".

Previously, experts say, some companies could have started a business then struggled later if a competitor tried to mimic their success by opening a venture with the same - or very similar - brand name.