In this article, well be sharing with you what are the foreign investment laws in Dubai and how it presents an opportunity for great businesses.
The process of liberalization of foreign investment laws in Dubai began in the year 2018 when it introduced the new FDI Law.
Before 2018 no foreign person or business could own more than 49% share of a company but with this new law, it can be extended up to 100%.
Which industries are excluded from 100% ownership?
Businesses excluded from the permissible list:
- The Petroleum Sector
- Military Sector
- Telecommunication Industry
- Private Pharma Sector
- Finance & Insurance Sector
- Publishing Industry
- Labour & Recruitment Industry
- Land & Air Transportation Services
The final decision of the stake approval lies with the FDI Committee of Dubai.
Which Industries are allowed for 100% ownership?
The following are some of the major Industries which are allowed for 100% ownership under the new Foreign Investment Law in Dubai:
- Administrative and support services
- Art and entertainment
- Educational activities
- Hospitality and food services
- Information and communication
- Professional, scientific, and technical activities
- Renewable energy
- Transport and storage
Why Dubai is attracting so much Foreign Direct Investment?
The jobs created by the FDI in Dubai in the year 2018 were more than 25,000.
The U.S.A was the major contributor to the FDI in Dubai as it contributed over 1/3rd of the total FDI in Dubai in 2018.
There is a total of 122 economic sectors and activities in which foreign direct investment is permitted.
The licensing procedure in Dubai takes up to 5 days which is much less time than what any other country offers.
Conditions for 100% ownership under the new Foreign Investment Law In Dubai
At least 2 Million AED is to be invested to own a 100% company in Dubai.
The figure can go up to 100 Million AED but only for some specific sectors.
The use of new technology in your business is a must for claiming 100% ownership.
UAE Licensing Requirments shall be met by the investor and the company should contribute to research & development.
Major tax benefits in Dubai
- There are no corporate taxes for the majority of Industries.
- No direct income tax
- Very little limitations
- No limit on reinvestment of profit in the business