MoE explains new cooperative law and its role

0
27

Abdullah Bin Ahmed Al Saleh speaks to the media on Thursday.

Gulf Today, Staff Reporter

The Ministry of Economy held a media briefing on the Federal Decree-Law No. 6 of 2022 on cooperatives, launched by His Highness Sheikh Mohamed Bin Zayed Al Nahyan, President of the UAE.

The law establishes a milestone in the cooperatives sector, thus contributing to building a leading cooperative experience that keeps pace with international standards. The new law will encourage members of the community to establish cooperatives in new sectors and diversify their operations to include various kinds such as consumption cooperatives, production cooperatives, employees’ and professionals’ cooperatives, community cooperatives, service cooperatives (financial and health), digital cooperatives, platform cooperatives, and other cooperatives approved by the Cabinet.

During the media briefing,  Abdullah Bin Ahmed Al Saleh, Undersecretary of the Ministry of Economy, emphasized that the UAE, in line with its wise leadership’s vision and directives, has adopted a new perspective on the development of the cooperatives sector, in order to position it as a key pillar to the country’s sustainable economic and social development. The country is keen to launch policies that comprehensively enhance the performance of this key sector, strengthen the cooperatives system and its contribution to the national GDP, and support the diversity, competitiveness, and sustainability of national economy in line with the principles of the 50 and the UAE Centennial 2071 goals.

He added: “The UAE issued the Federal Decree-Law No. 6 of 2022 on cooperatives, aimed at developing and enhancing the cooperatives sector to take it to higher levels of prosperity. In light of the new law, the Ministry of Economy has set two new goals. The first one is to increase the contribution of cooperatives to the non-oil GDP by 5 per cent by the year 2031, as compared to the sector’s current contribution of less than 1 per cent. The second goal is to increase the number of members contributing to cooperative unions to nearly 500,000 from the current 100,435.”

 In his speech, Al Saleh said: “The new law on cooperatives marks an important stage in the development of the sector’s governance. The Ministry of Economy and its partners, including local and federal government entities, the cooperatives sector, and the private sector, have adopted a proactive and flexible approach to the development of the law, also taking future economic trends into consideration. Furthermore, the Ministry relied on comparative studies that use advanced countries in the field of cooperatives as case studies. The UAE Federal National Council has also reviewed the Law to ensure an updated and integrated legislation in line with global best practices, and to meet the evolving needs of the UAE’s business environment.”

The Ministry worked alongside its partners to develop the articles of the law by following a flexible and proactive approach that foresees future trends and through comparative studies that analyzed leading global cooperative models in order to create the new, integrated legislation. It aligns with global best practices and efficiently meets the demands of the UAE’s business environment.

Al Saleh stated that the new law is an extension of the legal and corporate frameworks governing the UAE’s cooperatives sector currently, ensuring its sustainability and maximizing its growth potential.

He added: “The law creates new prospects for all members of society to participate in the cooperative sector’s operations, in addition to building a new generation of leaders in the cooperatives sector. It generates more employment opportunities in this vital sector, encouraging and spreading the innovative cooperative culture in society. This will be achieved by allowing non-citizens to obtain memberships in the country’s cooperatives, except for consumer cooperative associations with memberships that are exclusive to UAE nationals.”

As per the law, cooperative unions in the UAE will have more room to diversify their activities and expand in the country’s markets while ensuring complete protection of the participants’ rights. The law also supports building leading Emirati cooperative associations in new sectors, most notably the new economy sectors, as well as in the fields of health, education, tourism, financial services, and other vital and priority sectors in the UAE.

The law allows for listing and trading cooperative associations in the country’s financial markets in order for them to benefit from the advanced and innovative services provided by the country’s financial markets in terms of transparency, flexibility, and speed of procedures.

LEAVE A REPLY

Please enter your comment!
Please enter your name here