Dubai, the populous and most multicultural Emirate of the United Arab Emirates has emerged over the years as a financial powerhouse and entrepreneurial hub.
It has achieved this vaunted status by evolving a sophisticated and efficient corporate governance model which has made it incredibly easy to incorporate companies and conduct business.
The Department of Economic Development (“DED”) is the umbrella regulatory entity and Registrar for all onshore companies in Dubai; all Free Zones, offshore jurisdictions in the UAE ultimately come under the aegis of the DED.
The advantages of incorporating a business in Dubai depends on the type of activity your company will engage in. The DED provides an exhaustive list of activities, which is emulated by the various free zones in their own list of permissible activities. This list covers all kinds of industrial, commercial and professional activities.
There are certain activities which demand that the majority shareholding in a company be owned by an Emirati national. This raises issues of business continuity in case of the Emiratis shareholders demise and application of Sharia Law to their shareholding. The DED noted such concerns and allowed the formation of Emirati Corporate shareholding companies. As these are corporate entities, their longevity becomes a non-issue. This is limited only to certain onshore companies formed directly under the DED and does not extend to the free zones or offshore companies based in Dubai.
Apart from specific initiatives, Dubai has much to offer new and existing businesses. A few highlights are as follows:
International Trade Hub:
Dubai is truly a global hub. It is an international node for air and sea travel with excellent infrastructure to support both. The Dubai airports and ports are internationally recognized for their accessibility, competitive pricing and services.
Additionally, Dubai has an open border foreign labour policy. Dubai has standard policies and procedures for granting work visas which are swift and efficient. This is an added advantage for private sector companies which allow them to recruit expatriate employees at internationally competitive wages.
No Corporate and Personal Taxes:
All companies in Dubai are free from corporate and personal income tax returns. Companies can repatriate all of their profit and capital. There has recently been an addition of Value Added Tax of 5% on all goods and services (with a few exceptions such as government fees).
Further, Dubai has Double taxation agreements with various countries. The Ministry of Finance provides Tax Residency Documents to companies allowing then to present the same to their home countries and avoid double taxation.
World Class Infrastructure:
Among the Emirates, Dubai has some of the best infrastructure, rivalling what any city in the world has to offer. It has 24×7 electricity, world class highways and incredible utility services. They also have efficient government departments which have a business centric approach to providing services. The Dubai Airports and ports offer unmatched connectivity with the world and provide award winning services.
Dubai boasts of some of the biggest shopping Malls in the world and fantastic commercial and residential spaces spread across the Emirate. This Emirate has been a tourism center for the world for nigh two decades.
Dubai Expo 2020, a mega event has attracted global media attention and is said to be a construction wonder which will bring phenomenal international investment to Dubai.
Low import duties:
The open port in the Jebel Ali has low import duties and no taxation. This allows companies to offer branded products, especially electronics, at lower prices than the originating countries.
Most goods and items that are imported into the Dubai/UAE enjoy extremely low import duties. To add to this, goods imported into free trade zones are completely exempt from import duties.
Located strategically on the new Southern Silk Road between Asia, Europe and Africa, the Dubai enjoys excellent trading conditions.
These and many more reasons make Dubai an ideal place to open and operate a business.
Please contact one of our specialist lawyers today for more details. Email us at email@example.com or call +971 4 448 4284.
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