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Business Environment in Dubai

Overseas businessmen will find that their counterparts combine local and regional expertise with a full understanding of international business practices. English ranks on a par with Arabic as the main business language and there are plenty of foreign banks, lawyers and other advisors – as well as the Department of Tourism and Commerce Marketing, The Economic Department, Chamber of Commerce and Industry and Jebel Ali Free Zone Authority to help those wishing to enter the market.

The emirate's transport infrastructure is unrivalled in the region in terms of size, facilities and efficiency. Its ports are served by more than 170 shipping lines and the airport by around 100 airlines.

The postal system in the UAE is very modern and the post offices are among the most efficient in the Gulf. Between the UAE and Europe or the USA, mail takes about ten days. To Australia, mail takes about eight to ten days. There is an excellent telephone system and you can phone anywhere in the world from the most remote areas. Throughout the country there are telephone offices which are equipped to send and receive fax, telex and telegraph messages. Internet use in the UAE in general and Dubai in particular (as evidenced by the creation of Dubai Internet City) is extensive, and the government has developed many effective online portals for accessing services and information.

There is no corporate tax in Dubai. The only exceptions to this are for oil producing companies and branches of foreign banks. Likewise, there are no personal taxes. Direct taxation is against the traditions of the UAE and it is highly unlikely that it will be introduced in the near future. (See Direct Corporate Taxation and Personal Taxation.)

Trade practices in Dubai are in line with normal international standards. All correspondence should be in Arabic or English. As a sophisticated market, full technical specifications should be provided with CIF Dubai prices and Middle East references. Payments are normally effected by letter of credit.

The UAE is a signatory of the General Agreement on Tariffs and Trade (GATT).

The registration of accountants and auditors in the UAE is governed by Federal Law No. 9 of 1975. There is no local professional body of accountants but many of the large international accountancy firms have offices in Dubai. Under Federal Law No.13 of 1988, as amended, all businesses are required to keep financial records but current legislation is not specific as to the nature of such records.

Foreign companies and individuals are not permitted to own land or real estate in Dubai. All property must be rented or leased for the purposes of running a business.

Towards the end of 1992, the UAE President enacted three Federal Laws on the protection of industrial and intellectual property. These laws came into effect in 1993 and provide protection against commercial piracy and fraud. The laws are: Federal Law No. 37 of 1992 on Trademarks, Federal Law No. 40 of 1992 on Protection of Intellectual Property and Copyright, and Federal Law No. 44 of 1992 on Protection of Industrial Property.

There is a comprehensive framework of legislation to ensure that business in the UAE is conducted in a fair and orderly manner. There are laws dealing with commercial transactions, intellectual property, labour and other aspects of business life.

In September 2005, Khalaf Al Habtoor, member of the Dubai Economic Council, revealed that the UAE's Ministry of Finance and Industry was putting the finishing touches to new company laws.

At the time of writing legislation was being finalised by the UAE authorities to amend partnership rules, foreign ownership thresholds and IPO rules.

Under current rules, when a firm decides to float on the stock market, it must list at least 55% of its shares, leaving its former owners holding a minority stake. This has led many family-owned enterprises to avoid listing.

However, the proposed legislation would bring the listing threshold as low as 25%.

Dubai has many local and international law firms willing to advise foreign business organisations on legal matters.

Dubai has civil, criminal and Shariah (Islamic) Courts of first instance. All court decisions may be brought to the Dubai Court of Appeal. Thereafter, a final appeal may be made to the Dubai Court of Cassation.

The Civil Court (as opposed to the Shariah court) has jurisdiction over labour, civil and commercial transactions, as well as personal matters (e.g. wills, divorces etc.) relating to non-Muslims. The language of the Courts is Arabic and advocates admitted to plead are Arab nationals.

However, in addition to these systems, the DIFC has its own court, which held its first session in October 2005.





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