The United Arab Emirates (UAE) has emerged as a premier global destination for businesses focused on innovation, artificial intelligence, and entrepreneurship. This has also made it a magnet for foreign investments, resulting in a notable improvement in its rankings on international indicators related to business and investment attractiveness.
The UAE offers a wide range of incentives for investors, actively supports entrepreneurship, and promotes the establishment of new companies to diversify national income sources. By continually enhancing its economic environment to attract foreign investments, the UAE is working towards strengthening the role of investments in its national economy.
The Emirates News Agency (WAM) has highlighted 13 benefits and incentives provided to investors in the UAE. These measures have significantly enhanced the country’s investment appeal, attracted substantial investments, and solidified its position as a leading global investment hub.
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100% ownership of companies
With the enactment of the Commercial Companies Law in 2020, investors from around the world will now have the opportunity to establish and own companies in the UAE and its regions without the need for a UAE national agent. This means that foreign companies looking to open branches and conduct business activities in the UAE will no longer be required to have a local sponsor.
40 free zones for setting up a business
The United Arab Emirates boasts over 40 free zones, providing foreign investors with the unique opportunity to retain full ownership of their companies. This flexibility extends to the selection of the ideal free zone for establishing their businesses, with options available throughout the country. These free zones cater to a wide range of economic activities, making them an attractive choice for investors seeking to maximize their potential for success.
2000 economic activities
Foreign investors in the UAE have a wide range of investment opportunities available to them, including trade, industry, agriculture, services, education, health, construction, and many others. In fact, there are over 2000 economic activities to choose from. It is important to note that the law only excludes a very limited number of activities deemed to be of strategic importance. This allows for a diverse and dynamic investment environment in the UAE.
Legal Forms of Companies
In accordance with Federal Law No. (26) of 2020 on Commercial Companies, foreign investors are now permitted to own various types of commercial entities, including public joint stock companies, private joint stock companies, limited liability companies, simple recommendation companies, and solidarity companies.
No requirement for a national agent
The UAE Commercial Companies Law does not mandate that foreign companies seeking to establish a branch and conduct business activities in the UAE must have a local agent. This is a significant advantage for foreign companies as it simplifies the process of doing business in the UAE and promotes transparency.
Boards of Joint Stock Companies
The UAE Commercial Companies Law does not mandate that the chairman of the board of directors or the majority of board members must be UAE nationals. This provision allows foreign investors to have complete control over their shares in companies, unless specified otherwise by a decree or decision.
No minimum capital requirement
In the UAE, investors are required by law to specify the capital in both the articles of incorporation and the articles of association. Interestingly, there is no minimum capital requirement for limited liability companies, which simplifies the process of setting up businesses and allows investors more flexibility in planning their projects. This unique feature of UAE law provides a favorable environment for entrepreneurs looking to establish companies and grow their businesses.
No income tax and full profit remittance
The UAE does not impose income tax on individuals, allowing both individuals and investors to freely repatriate their profits. These incentives have historically been enjoyed by investors in the UAE, thanks to the country’s free-market model that has been in place since its founding.
Golden residency for investors
The United Arab Emirates has implemented a long-term residency visa program, offering periods ranging from five to ten years for investors, entrepreneurs, and individuals with exceptional talent. This initiative provides an opportunity for residents and their families to establish roots, conduct business, and fully immerse themselves in the vibrant culture of the UAE. It allows for a seamless transition for those looking to reside, work, study, and thrive in the country for an extended period.
Ease of contracting professional labor
The UAE is recognized as a hub for talent, skilled labor, and human capital in key economic sectors. This is attributed to its flexible labor policies and the ease of attracting foreign workers. The expanding labor market in the UAE has enabled the development of a highly specialized workforce across various disciplines.
Low tariffs
Low tariffs have played a crucial role in positioning the UAE as a prominent hub for international trade. The government imposes tariffs ranging from zero to 5 percent, which has significantly contributed to the country’s status as a global and regional trade leader. The UAE ranks third in the world and first in the Arab world for re-exports, showcasing its strong presence in the global market.
Incentives for the industrial sector
The United Arab Emirates provides a range of incentives to encourage investment in key industries such as technology and manufacturing. These incentives include competitive financing options for priority sectors, in collaboration with the Emirates Development Bank, as well as strategic and competitive tariffs for key industries. Additionally, the UAE offers customs exemptions on investments and production inputs, such as machinery and raw materials, to support the industrial sector. Other initiatives, such as the National Content Program and the Make in the UAE campaign, aim to promote local industry and provide further incentives for businesses operating in the UAE.
