Q: Assalamu Alaikum We are 4 partners in a business and one of the partners wants to sell his shares to two existing partners in the business without the consent of the 4th partner. There is no provision made in the MoA regarding the sale/transfer of shares. So can this be done without violating any law in the UAE? Thanks

Q: Dear Lawyers, Can a partner in an LLC company (Dubai Mainland) sell their shares to a third party without the consent of the other partners? If one partner wants to exit the company and the other shareholders are neither responding to this request nor giving permission, what is the way forward? We have sent an email to the other shareholders notifying them of the intention to sell the shares, but there has been no response. Please advise. Please advise!

Q: Dear Sir/Madam, We purchased an LLC company in 2018 for 300,000 dirhams. We invested an additional 200,000 dirhams, and I granted full executive power to the Managing Director in the memorandum of understanding, including the authority to buy, sell, and manage the company. However, the Managing Director recently sold the shop to another company without my knowledge or consent. We are four partners: the local partner holds a 51% stake with an 85,000 dirham investment, the Managing Director holds a 17% stake with an 80,000 dirham investment, the third partner holds a 16% stake with an 80,000 dirham investment, and I hold the remaining 16% stake with an 80,000 dirham investment. The problem is that the partners are now claiming that the company is losing money and cannot afford to pay rent or renew its license. However, I managed the shop until 2023 and calculated the profits every month. I received my share of the profits, and the other partners also received their share. However, when I went on vacation, they started claiming that the company was making losses and stopped paying me my share of the profits. I know that they sold the shop and received 120,000 dirhams, but they are still lying to me and refusing to pay me my share. I have requested the account statements for the past 11 months, but they have refused to provide them to me. Please advise me on my legal options!

An interview-format article covering the topic of shareholder disputes in the UAE and pre-emptive measure to be considered. This is from the legal podcast of lawyer Ludmila Yamalova, the founder of Lawgical with LYLAW.

It is the first article in a series of articles written by the author to give a better insight to the readers about the corporate governance practices under the best practice principles and the UAE legal system through innovative suggestions of its implementation for your organisation. Next series will be on the UAE regulatory framework on corporate governance.

The provisions of this law, promulgating UAE Civil Code, govern the civil transactions in the United Arab Emirates. The commercial transactions remain subject to the laws and regulations applicable in their regard.

The provisions of this Federal Decree-Law No. (32) of 2021 on Commercial Companies governs commercial companies in the United Arab Emirates. The New Commercial Companies Code repeals the previous UAE Commercial Companies Code (Federal Law No. (2) of 2015 on Commercial Companies).