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Find out moreWelcome to the first edition of Law Update for 2025. As we begin this exciting year, we are pleased to turn our attention to one of the most dynamic sectors in the UAE and the broader GCC region – healthcare. Over the past several years, the region has seen unprecedented growth in this sector, driven by legislative advancements, technological innovations, and the increasing focus on sustainability and AI. As such, healthcare is set to be one of the most important sectors in the coming decade.
In this issue, we explore key themes that are significantly shaping the future of healthcare in the UAE, such as recent changes in foreign ownership laws. These reforms present a major opportunity for foreign investors, opening up new avenues for international collaborations and improving the overall healthcare infrastructure. The changes in ownership laws are an important milestone, and we provide an analysis of what this means for the industry and the various players involved.
Read NowMasood Khan - Senior Associate - Corporate Structuring
November 2014
A sector that has remained largely immune to economic fluctuation in Dubai has been the health sector, which, given the government of Dubai’s objective to make the Emirate a preferred destination for medical tourism, continues to experience robust growth. Concurrent with this growth, activities supporting the healthcare sector have been on the rise. One such supporting activity is providing consultancy services to the health sector.
Under the Department of Economic Development’s classification list, this activity is codified as 851909 and described as health planning and consultancies. Under this activity, corporate entities can provide consultation and feasibility studies to health facilities, including hospitals and clinics, to determine requirements of medical equipment and supplies, technical staff qualification, as well as providing suggestions on health facility engineering layout and setting up health quality assurance program to promote the service level of these health facilities.
This article discusses certain regulatory considerations being faced by investors wishing to provide Health Planning Consultancies in Dubai.
In mainland Dubai, the activity of Health Planning Consultancies can be licensed, but under the current policy of Department of Economic Development, issuance of such licence is restricted to sole establishments, civil partnership companies and branches of foreign companies set up under Federal Law No. 8 of 1984 Concerning Commercial Companies. A limited liability company, which is generally the preferred form of corporate entity, cannot currently be licensed to conduct the activity of Health Planning Consultancies.
This restriction poses a challenge for an investor who wishes to conduct the activity of Health Planning Consultancies in the UAE through a limited liability company. To add to this complexity, none of the free zones, other than Dubai Healthcare City, license an activity as wide as activity number 851909. Therefore, as the current regulatory practices stand, there are no other options available for a prospective investor who wishes to provide the services under Health Planning Consultancies. Practical considerations such as lack of office space or preference for another free zone can make provision of Health Planning Consultancies through a limited liability company virtually impossible.
Recently, a party approached Dubai Silicon Oasis, a free zone in Dubai, with a proposal to allow the licensing of Health Planning Consultancies as described as activity number 851909. Dubai Silicon Oasis agreed to license this activity, subject to an approval from the Dubai Health Authority. Given the nature of the activity of Health Planning Consultancies, the premise of the proposal was that an approval from Dubai Health Authority would not be required, as under this activity a corporate entity does not provide any medical or health services.
Dubai Silicon Oasis and the Dubai Health Authority, initially showed reluctance, however, in successive deliberations, both Dubai Silicon Oasis and Dubai Health Authority accepted the view that no such approval from the Dubai Health Authority would be required for setting up a free zone limited liability company in Dubai with Silicon Oasis to conduct the activity of health planning and consultancies.
Based on this, a corporate entity can now be set up in the free zone of Dubai Silicon Oasis as a free zone limited liability company with the licensed activity of Health Planning Consultancies, without the approval of the Dubai Health Authority. The advantages of setting up in Dubai Silicon Oasis are as follows:
To ensure that the free zone company in Dubai Silicon Oasis can be set up for the activity of health planning consultancies and expand into mainland Dubai (so that it can bid for government projects, etc.), the free zone company will be able to set up a branch office in mainland Dubai. In this regard, discussions with the Department of Economic Development have confirmed that it will have no objection to licensing such a branch as long as a no-objection letter from Dubai Silicon Oasis is obtained. A benefit of this structure is that it will facilitate setting up branches and subsidiaries in mainland Dubai and outside of the UAE, subject to the laws of the local jurisdiction.
This structure should support the objective of Dubai government to make the Emirate a destination of choice for health related services by facilitating experts providing health related services and services supporting the health sector to set up a limited liability company in Dubai which is 100% owned by foreign investors.
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