Investment Opportunities in the U.A.E.
Protection of Foreign Investment
- Bilateral Investment Conventions Signed By the United Arab Emirates
- UAE has signed 32 bilateral agreements on investment. See the list of countries provided by the UNCTAD.
- International Controversies Registered By UNCTAD
- Some cases of disputes concerned with foreign investments.
- Organizations Offering Their Assistance in Case of Disagreement
ICSID , International Center for settlement of Investment Disputes
- Member of the Multilateral Investment Guarantee Agency
Country Comparison For the Protection of Investors
|United Arab Emirates||Middle East & North Africa||United States||Germany|
|Index of Transaction Transparency*||4.0||6.3||7.0||5.0|
|Index of Manager’s Responsibility**||7.0||4.6||9.0||5.0|
|Index of Shareholders’ Power***||2.0||3.4||9.0||5.0|
|Index of Investor Protection****||4.3||4.8||8.3||5.0|
Source: Doing Business
Note: *The Greater the Index, the More Transparent the Conditions of Transactions. **The Greater the Index, the More the Manager is Personally Responsible. *** The Greater the Index, the Easier it Will Be For Shareholders to Take Legal Action. **** The Greater the Index, the Higher the Level of Investor Protection.
Procedures Relative to Foreign Investment
- Freedom of Establishment
- It is limited since it is mandatory to have a local agent for creating an establishment in the UAE and that the foreign shareholding in this company cannot exceed 49%.
- Acquisition of Holdings
- The majority capital acquisition of a local company is limited to 49%.
- Obligation to Declare
- There is no special obligation for declaration. Foreign capital in a company can anyway be more than 49% except for free zone.
- Competent Organization For the Declaration
World Association of Investment Promotion Agencies
- Requests For Specific Authorizations
- In the sector of banking, insurance, health, maritime transport, education, media, and telecommunications, specific authorisations are required by the concerned Ministries.
Office Real Estate and Land Ownership
- Possible Temporary Solutions
- No temporary facility is provided in Emirates for companies who are keen to set-up.
- The Possibility of Buying Land and Industrial and Commercial Buildings
- In Dubai, Ras El Khaimah, Sharjah and more recently in Abu Dhabi, the access to property for foreigners is authorised under the form of emphyteutic leases. These are mainly for housings located in the specific investment zones. Generally, it is not possible for a foreigner to buy landed property outside these zones in the Emirates.
- Risk of Expropriation
- Till now, no foreign investor has been concerned by export procedures. In fact, it is clear that this type of procedure will be used only in case of very serious risks and the compensation would be generous.
- Forms of Aid
- As it is, there are no incentive schemes for investments. Only the proliferation of free zones can be perceived as a will to attract foreign capital.
- Privileged Domains
- No special aids.
- Privileged Geographical Zones
- The oil activity sector, ship yards and also restructuring of public sectors (water and electricity distribution d).
- Free Zones
- Many advantages are given to foreign companies which are established in free zones. These are not subject to requirement of a local majority shareholder. Foreign investors can hold 100% of the Capital. Moreover, there is no customs duty on imports. Finally, waiver of corporate tax or income tax if the local authorities decide to create and ensure it.
- Organizations Which Finance
- The Arab Trade Financing Program whose mission is to promote Arabic exports proposes refinancing facilities, for pre-shipment export credit loans and buyer's credit. The foreign subsidiaries established in UAE held 51% by people of Emirates can benefit from these facilities.
- The Key Sectors of the National Economy
- The gas and oil sectors remain the key sectors for foreign investments
- High Potential Sectors
- Real estate, services and agro produce are the booming sectors
- Privatization Programs
- Abu Dhabi Emirate has launched a policy for attracting foreign direct investment to organise and restructure certain public services like water and electricity distribution. It is in this context that companies attached to ADWEA (Abu Dhabi Water & Electricity Authority) and one or several foreign investors are included for construction or management of power stations or sea water desalinisation plants. This plan has also been retained for the collection and transport of household wastes.
- Tenders, Projects and Public Procurement
Tenders Info, Tenders in United Arab Emirates
DgMarket, Tenders Worldwide
Sectors Where Investment Opportunities Are Fewer
- Monopolistic Sectors
- Telecommunications and Posts are monopolies. The oil industry is a protected national sector.
- Sectors in Decline
- Textile, agriculture and maritime transport are the sectors in decline.
Finding Assistance For Further Information
- Investment Aid Agency
Abu Dhabi Investement Authority
- Other Useful Resources
Emirates Free Zone, directory of the free zones with a presentation of UAE.
- Doing Business Guides
United Arab Emirates Commercial Guide 2010 - Buy USA
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