Shareholders of the company in the UAE incur liability for actions of the company, similar to liability stated in regulations of most other international jurisdictions.
This means that in the course of ordinary business, in case of incorporation of the company in the form of limited liability company, the shareholders of the company shall be responsible within their shareholdings.
It is worth noting that, if the shareholder of the company has issued a cheque on behalf of the company, he also incurs personal liability for cover thereof.
Taking into account some specifics aspects of corporate law in the United Arab Emirates in terms of rights of shareholders and directors of the company, that provide, in essence, all priority rights to company's shareholder, it is quite common situation where the principal account signatory of the company, even though there is a director, remains shareholder that signs the cheques.
In addition, rights and obligations of nominee shareholders in the UAE have some unique specificity as well. In fact, the law of the United Arab Emirates does not restrict the rights and obligations of nominees. For this reason, nominees are deemed real owners of the company, both in terms of rights and liability. For this reason, nominee shareholders for the companies in the UAE is rare tool for solving corporate challenges.
