A recent media report stated that a total of 32,256 business licenses were issued in the UAE over the first eight months of the year, bringing to 572,615 the total number of business permits in the country, a growth of 6 pc from 540,359 by the end of December.
The media report directed by the Ministry of Economy’s National Economic Register also mentioned that there has been a substantial upsurge in business licenses. This has also immensely contributed in the economic growth as estimated and backed up by the Central Bank of the United Arab Emirates. The Central Bank noted that the predictable GDP in the country will grow by 2.4 pc in 2019.
The statistics show that the United Arab Emirates continues to attract foreign investment each year with people choosing the country to set up new companies or set up branch offices. Strong financial reserves, a large sovereign wealth fund, consistent government spending, a progressive policy of economic diversification and increased foreign investment that contributes to the UAE’s robust economy. Due to these measures, foreign investors are attracted to Dubai and various other Emirates across the UAE. They intend to capitalise on the high standard of living, profitable business opportunities and extremely low taxes.
UAE is centrally located connecting the East and the West and companies also benefit from working between the time zones to hyper elevate business operations and ease communications on a global scale. Starting a business in the UAE can be beneficial on a global forefront, but each business activity is different and needs to be positioned precisely.
The UAE has several multi-speciality jurisdictions offering complete foreign ownership with 100% profit repatriation; economic incentives and tax exemption. These jurisdictions are mainly classified under three – they are Mainland, Free zones and Offshore. So where to setup a business in the UAE?
UAE Mainland
UAE Mainland companies are directed by the Department of Economic Development in every Emirate. UAE Mainland companies are the most advantageous in terms of doing business globally as well as within the UAE. Mainland companies have fewer restrictions compared to any other jurisdiction. Also, the set up and operational cost is affordable for a long-term business. As per the commercial law in the UAE, a mainland business does need partnership with a UAE national. Nevertheless, a business setup service provider can become a local partner, ensure documented reliability and handover all the company’s authority.
UAE Free zones
A free zone is a discrete commercial entity with its own set of rules and regulations. UAE free zones allow 100% foreign ownership. Free zones offer excellent infrastructure, asset protection and tax exemptions. There are hundreds of free zones in the UAE that companies can opt from, each free zone has its own advantages and limitations. Free zone establishments are limited to conduct business only within the situated free zone, outside the country or B2B transactions in the UAE. But the fabulous tax benefits far outshine any limitations.
UAE Offshore
Offshore companies in the UAE is an ideal way to secure money and assets. Businesses can be conducted privately in the UAE offshores and complete confidentiality is maintained by the offshore authorities. Companies can do business overseas and have UAE bank accounts. However, offshore companies cannot conduct business in the Emirates as they only get a certificate of incorporation.