Success tips when doing business in UAE
Please find below some information regarding how to do business after UAE company formation.
Important considerations before UAE business formation
- An essential factor in starting a business in the UAE is to thoroughly research the business sector you are planning to invest in. Healy Consultants recommends our Client prepare a detailed business plan including an extensive market study and evaluation of competitors;
- To optimize the success of your new business venture in the UAE, Healy Consultants recommends your Firm to i) complete a feasibility study ii) communicate with the respective government departments iii) speak to your local UAE embassy and iv) communicate with Healy Consultants Clients who successfully launched their business in the UAE;
- Foreign companies should be aware i) UAE statistics and market data are usually imprecise ii) transactions tend to take longer than expected iii) more frequent and longer market visits are required, at least initially and iv) complex business procedures are common.
UAE is an Islamic state and follows the Islamic culture. It is important for foreign companies to respect this and make themselves aware of the Islamic traditions in business:
- The week commences on Saturday and extends through Thursday, Friday being the day of rest. Government offices are closed on Thursdays and Fridays;
- During business meetings, Arabs spend a lot of time discussing things in general and then once they are comfortable will talk business with you. Expecting them to directly come to the point and discuss business is seen as rude and must be avoided;
- If invited to the home of an Arab, you should always accept and take every opportunity to become acquainted with local people. Your Arab host will be generous and interested in you. However, you should avoid debating politics and religion as your opinions might be regarded as ill-informed or even offensive, even if they seem acceptable to you from a western perspective;
- Learn enough Arabic to communicate the pleasantries, greetings, and responses. You will enjoy peoples’ reactions. However it is important to use the Arabic language respectfully because Arabs believe it is designed to carry the word of God;
- Arabs are hospitable and place a great deal of emphasis on an outward expression of politeness and quiet demeanour. Arabs rarely say a direct ‘no’ to a proposition, so you must listen and observe carefully. If the response is ‘leave it with me’ or ‘I’ll think about it’, there’s a good chance that the project will go nowhere;
- Avoid putting an Arab in a position where he might suffer a ‘loss of face’ in front of other Arabs. He will especially appreciate this, if he notices your action;
- Foreign entrepreneurs need to be aware of how they must treat women in the workplace. Examples include:
- Not all UAE women are comfortable shaking hands with foreign men. You need to wait for the woman to put her hand out first before putting forth your own hand;
- It is also not acceptable to touch a woman even in a friendly manner on the shoulder or other places at any time in the office;
- It is common for men and women to sit at different areas of the office. What this means is that you need to designate part of your office where all the men would sit and another part of your office where the women would sit.
Interesting facts about UAE
Please find below a few noteworthy facts re the United Arab Emirates, which are worth reading when considering forming a company in the UAE:
- When the Khalifa Industrial Zone in Abu Dhabi officially opened earlier this year, it created an area larger than the entire island of Singapore for trade. It will be the largest container port in the region and KIZAD will account for nearly 15% of GDP when complete;
- The UAE’s soaring success as a nation is exemplified by having the world’s tallest building. The Burj Khalifa soars 828 metres above Dubai and places the nation truly on the world map;
- The UAE became a member of the United Nations and the Arab league in 1971. It is a member of the International Monetary Fund, the Organization of Petroleum Exporting Countries, the World Trade Organization and other international and Arab organizations;
- The UAE gulf news reported that Abu Dhabi the wealthiest emirate in UAE, with regards to GDP and per capita income;
- The UAE is ranked the world’s 17th most competitive country in World Economic Forum’s Global Competitiveness Report 2017. The survey takes into account factors such as infrastructure, macroeconomic stability, health and education, labour market efficiency, technological readiness, and innovation.
Frequently asked questions
Am I required to visit UAE to incorporate a company there?No, Healy Consultants can legally incorporate your UAE company without you needing to travel.
What is the minimum number of directors required?Under statutory regulations, all jurisdictions in the UAE require a minimum of one director.
Can my company be 100% foreign-owned?Yes, if incorporating in a free trade zone.
Is a resident director required?No.
What is the minimum number of shareholders required?All companies require a minimum of two shareholders except a Dubai offshore company and Ras Al Khaimah free trade zone require a minimum of one shareholder.
Are shareholder/director details available for public viewing?Yes, for all jurisdictions except for Dubai offshore company.
Which type of company can trade in the UAE?Only a Dubai and an Abu Dhabi LLC are allowed to trade in the UAE.
What are the minimum capital requirements?There are no standardized minimum capital requirements in the UAE. Some companies may not be subject to minimum share capital requirements. These are judged on a case by case basis, dependent on the size, nature and goals of the business.
Is a UAE company required to submit an annual tax return and/or financial statements?All companies in the UAE are obliged to submit annual audited accounts to the government.
Do I need to rent a premises for my company?All companies except Dubai offshore company need to rent premises in the UAE.
How much tax does a UAE company pay?All companies in the UAE do not have to pay any corporate tax.