Investment Incentives: Benefits for Investors in the UAE

The United Arab Emirates (UAE) has distinguished itself as a global investment magnet, offering a unique array of incentives tailored to boost small and medium enterprises (SMEs) and start-ups. By eliminating barriers to investment, the UAE is committed to diversifying its economy and positioning investments as a key driver of national growth. Here are some of the distinctive benefits and incentives that make investing in the UAE a compelling proposition.

1. 100% Company Ownership

One of the most compelling reasons to invest in the UAE is the freedom it offers to investors of all nationalities to establish and fully own companies. This opportunity, made possible by the 2020 Commercial Companies Law, allows foreign companies to operate without the need for a UAE national agent. This significant change has greatly enhanced the UAE's appeal as a business destination.

2. Over 40 Free Zones for Company Incorporation

The UAE boasts more than 40 free zones, offering tax exemptions and 100% ownership for foreign investors. These zones are strategically located across the country, providing flexibility for businesses to choose the most suitable location. Each free zone supports a variety of economic activities, catering to diverse business needs.

3. Diverse Investment Opportunities

Investors in the UAE can engage in a wide range of sectors, including trade, industry, agriculture, services, education, health, and construction. With over 2,000 licensed economic activities, the UAE offers minimal restrictions, allowing investors to explore numerous opportunities.

4. Flexible Legal Structures

The UAE’s Federal Law No. (26) of 2020 on Commercial Companies allows investors to choose from various legal structures, such as public shareholding companies, private shareholding companies, limited liability companies, limited partnerships, and partnership companies. This flexibility helps investors select the best structure for their business.

5. No Requirement for Local Sponsors

Foreign companies can operate in the UAE without needing a local national sponsor or agent, thanks to the UAE Commercial Companies Law. This provision simplifies the process of doing business and enhances transparency, providing a strategic advantage to foreign companies.

6. Control Over Company Boards

The UAE Commercial Companies Law allows foreign investors to control their shares in joint-stock companies. The chairman and the majority of the board are not required to be UAE nationals, ensuring that investors can manage their businesses effectively.

7. No Minimum Capital Requirement

There is no minimum capital requirement for limited liability companies in the UAE. Investors can determine the capital value in their articles of incorporation and company statutes, making it easier to start new businesses and plan projects with greater flexibility.

8. Tax-Free Environment and Profit Repatriation

The UAE does not impose income tax on individuals, investors, or corporations, except for oil companies and branches of foreign banks. This tax-free environment, combined with the ability to repatriate profits fully, makes the UAE an attractive investment destination.

9. Golden Visa for Investors

The UAE offers long-term residence visas, ranging from 5 to 10 years, to investors, entrepreneurs, and talented individuals. These visas allow expatriates and their families to live, work, and study in the UAE, supporting business establishment and growth.

10. Skilled Workforce and Talent Attraction

The UAE is known for its flexible labour policies and ability to attract skilled workers and talented professionals. This makes it an ideal environment for businesses to find and retain the human capital they need to thrive.

11. Low Customs Tariffs

With customs tariffs ranging from 0% to 5%, the UAE is a global trade hub. The country ranks 3rd worldwide and 1st in the Arab world in re-exporting, underscoring its strategic importance in international trade.

12. Industrial Sector Incentives

The UAE offers competitive incentives for investments in the industrial and technology sectors. In partnership with the Emirates Development Bank, these incentives include competitive financing facilities, energy tariff concessions, customs exemptions on machinery and raw materials, and programs like the “In-Country Value (ICV) Program” and “Make it in the Emirates” initiative. These initiatives are designed to support and unify the local industrial sector.

Conclusion

The UAE’s investment incentives provide a robust and flexible environment for business growth. With 100% ownership opportunities, extensive free zones, diverse investment sectors, and a tax-free environment, the UAE continues to attract and nurture global investments, driving a dynamic and diversified economy.