ADR & Arbitration
Canada–UAE Foreign Investment Promotion and Protection Agreement Signed: Strengthening Bilateral Investment Protections.
As part of the Government of Canada’s ongoing objective to double non-U.S. exports over the next decade, the Prime Minister recently visited the United Arab Emirates to expand and deepen Canada’s trade and
investment relationship with the UAE. On November 20, 2025, Canada and the UAE signed a new Foreign Investment Promotion and Protection Agreement (FIPA). Negotiations for the agreement began in 2016. The FIPA introduces enhanced protections for Canadian investors operating in the UAE and for UAE investors investing in Canada, with the aim of fostering long-term commercial partnerships between industries
in both jurisdictions.
At a high level, the FIPA establishes baseline protections for qualifying investors with respect to covered investments made in the other country. These protections include commitments relating to minimum standards
of treatment, national treatment, mostfavoured-nation treatment, and safeguards against expropriation, including the right to compensation. Collectively, these provisions are designed to promote fair, nondiscriminatory treatment of investors and their investments. The agreement also provides additional investment-related protections addressing matters such as senior management and board composition, regulatory transparency, and administrative processes. Detailed obligations are outlined in a non-official version of the FIPA currently available on Canada’s website.
Importantly, the FIPA contains several exceptions and carve-outs to certain obligations. These include pre-existing nonconforming measures, future measures adopted in specified sectors, exceptions to most-favoured-nation treatment, limitations on access to dispute settlement mechanisms, and other general exceptions. From a dispute resolution perspective, the FIPA establishes a mechanism for investor–
state disputes and includes an optional expedited process for claims not exceeding CA$10 million. It also provides for state-tostate consultation and dispute settlement procedures.
While the agreement has been signed, it is not yet in force. Both countries must complete their respective domestic legal processes before it becomes effective. The official version will be published once the agreement enters into force. In anticipation of implementation, Canadian and UAE investors may wish to review their investment structures to ensure they can benefit from the protections offered under the
FIPA.
In addition, both countries announced the launch of negotiations toward a Comprehensive Economic Partnership Agreement (CEPA), intended to further broaden and strengthen their overall trade relationship.
Corporate Restructuring & Insolvency
Corporate Restructuring in the UAE: Legal Framework, Strategic Pathways and Procedural Requirements
Corporate restructuring is a complex and strategic process involving significant changes to a company’s ownership, operations, or organisational structure. In the United Arab Emirates, the legal pathways and procedures governing restructuring are clearly defined and strictly regulated. A thorough understanding of these requirements is essential for businesses seeking to navigate the UAE’s corporate and regulatory landscape effectively.
What is Corporate Restructuring?
Corporate restructuring refers to the reorganisation of a company’s business model or ownership structure. This may include mergers, acquisitions, divestitures, or adjustments to capital structures. UAE commercial laws and regulations provide the legal framework within which companies may implement these changes in a compliant and structured manner.
Legal Paths for Corporate Restructuring
Companies in the UAE may pursue several recognised restructuring routes:
- Mergers, where two or more entities combine into a single company.
- Acquisitions, involving a transfer of ownership through the purchase of another company.
- Divestitures, through the disposal of specific assets or business divisions as part of a broader restructuring strategy.
Each option allows businesses to realign operations and ownership to meet strategic or financial objectives.
Procedural Requirements
Corporate restructuring must be undertaken in accordance with prescribed legal procedures, including:
- Obtaining necessary approvals from relevant regulatory authorities.
- Notifying shareholders of proposed changes.
- Ensuring compliance with applicable statutory requirements.
- Engaging legal advisors or consultants to manage regulatory and transactional complexities.
Adherence to these steps is critical to ensure the validity and enforceability of the restructuring process
Benefits of Restructuring
When properly implemented, restructuring can deliver meaningful commercial advantages, including:
- Streamlined operations
- Reduced costs
- Improved efficiency
- Entry into new markets
- Enhanced competitiveness
- Greater long-term value for shareholders
Restructuring also enables companies to respond proactively to evolving market conditions.
Challenges and Key Considerations
Despite its advantages, restructuring presents practical and legal challenges. Businesses may face regulatory hurdles, financial pressures, or operational adjustments. Accordingly, companies must carefully evaluate the associated risks and implications before proceeding.
Restructuring as a Strategic Alternative
In the UAE, restructuring operates as a strategic and legal mechanism to reorganise a company’s financial and operational position. Rather than resorting to liquidation, it provides an alternative solution aimed at
addressing financial distress, mitigating risks, and restoring sustainability where the business remains viable.
