By investing in Dubai, foreign companies are given wide options for commercial operations which include the following;
They have a direct trade option to make the sale directly between distributors and dealers.
With the arrangements of a commercial agency, a person of the UAE country or company is designated, and the agreements are registered in the Ministry of Economy and Commerce.
A branch or representative office with 100% foreign ownership is allowed. The local agent or sponsor must be elected and a permit from the Department of Economic Development is required.
In limited liability companies, foreign ownership is restricted to 49% and a permit from the Department of Economic Development is required.
When a foreign businessman decides to invest in Dubai, he or she obtains several incentives, for example, opportunity to invest in free zones. These areas were established to encourage investment projects and foreign trade. What Dubai Free Zones offer are financial districts conveniently equipped with all the services, facilities and communication infrastructures needed to establish a business and address the needs of investors.
Traditionally, 51% of all companies should be owned by UAE companies, but businesses registered in the free zones may be 100% foreign-owned. They are also exempt from custom duties and taxes, in addition to taxes levied on exports and imports.
Another commercial advantage lies in the absence of restrictions on hiring and sponsorship. For many companies, opening an office in one of the many free zones is an attractive idea, especially since Dubai is strategically located and offers a free market environment, state-of-the-art infrastructure, political stability, a booming economy and a duty free policy. There are currently 12 free trade zones in Dubai.
The Free Zones of Jebel Ali and Dubai Airport provide all the advantages available in other parts of the emirate, as well as 100% ownership and foreign control, a 15-year renewable guarantee for not imposing fiscal charges, no customs duties, efficient facilities, transport and distribution and full administrative and recruitment support.
In addition, foreign companies that choose to make the investments in Dubai are exempt from corporate tax and income taxes as well. Likewise, they will not be restricted to foreign currencies or the trade barriers. They will also have competitive import rights, 4% with many exemptions, as well as for labor, energy and the real estate costs.
