UAE Joint Venture Structure — Options for Business Partnerships Guide 2026
UAE businesses often partner with other companies through joint ventures (JVs). UAE joint ventures can be structured as contractual JVs, separate UAE companies, or special purpose vehicles. This guide covers UAE joint venture structures for 2026.
In this guide:
Types of UAE Joint Ventures
- Contractual JV: no new legal entity; two or more parties agree by contract to cooperate on a specific project; split revenues and costs; each party maintains own legal entity; common for construction projects and one-time collaborations
- Incorporated JV (new company): two or more parties form a NEW UAE company (LLC, FZE, FZCO) together; each becomes a shareholder; new entity has its own legal personality; better for ongoing long-term JVs
- DIFC/ADGM LLP: Limited Liability Partnership structure available in DIFC and ADGM; professional partnerships (law firms, consulting firms) often use LLP structure
Incorporated UAE JV Structure
- New UAE free zone company (FZCO): two or more shareholders; minimum 2 shareholders for FZCO; each shareholder contributes capital; shares reflect JV ownership split
- MOA: detailed MOA governs the JV company; voting thresholds; reserved matters (decisions requiring all shareholders); management structure
- Shareholders Agreement (SHA): supplementary to MOA; governs practical JV matters (exit mechanisms, profit distribution, non-compete, intellectual property contribution)
- Board structure: multi-shareholder JV often has a board with each shareholder appointing directors in proportion to shareholding; ensures representation
UAE Government JV Partnerships
- UAE government entities as JV partners: some UAE sectors require or incentivise having a UAE government entity as JV partner; this is different from the old mandatory local partner requirement (which was abolished for most activities in 2021)
- Offset programmes: some UAE government contracts require international companies to invest a percentage of the contract value in UAE through offset-approved JVs with UAE companies
- Privatisation: UAE government privatises some services through JV with private sector; companies can bid to partner with government entities on infrastructure and service JVs
Key UAE JV Legal Issues
- IP contribution: if one party is contributing intellectual property to the JV, how is it valued? Who owns improvements to the IP? What happens to IP if JV dissolves?
- Non-compete: JV parties typically agree not to compete with the JV during and for a period after the JV; UAE courts enforce reasonable non-compete clauses
- Deadlock: what if JV shareholders cannot agree? Mechanism needed: mediation, casting vote, or buy-sell provision (Russian Roulette clause)
- Exit: how does a shareholder exit? Right of first refusal; drag-along rights; pre-agreed valuation mechanism