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Update Regarding Foreign Direct Investment in the UAE

Following from our recent newsflash regarding foreign ownership of businesses in the UAE, Sheikh Mohammed bin Rashid Al Maktoum, UAE Prime Minister and Ruler of Dubai, has now made a statement approving the sectors and economic activities which are eligible for up to 100% foreign ownership. These include 122 economic activities covering industrial, agricultural, and services sectors.

This foreign ownership law is part of a multifaceted strategy by the UAE to increase foreign investment in the region.

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Government Fee Waivers

In a bid to boost investment in Dubai and based on the directives of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President, Prime Minister and Ruler of Dubai, a new package of fee waivers for various government services has been approved on February 5th, 2020 by Sheikh Hamdan Bin Mohammed Bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of the Dubai Executive Council.

The reduction of administrative costs and fees is expected to bolster Dubai’s position as a hub for business and a favourable habitat for investment which can only further the confidence of investors and the public in the government. The move comes as part of a series of government efforts to lift the national economy, promote economic growth, diminish costs on business owners and increase its competitiveness on a global scale. It follows a March 2018 decision to freeze Dubai government fees for 3 years and a 2019 UAE Cabinet decision to waive/amend 1,500 government service fees.

A total of 2,356 administrative fees belonging to 22 government entities were reviewed and new legislation was introduced to regulate and limit the introduction of new administrative fees to reduce the financial burden on the public and investors. The waiver covers services provided by 5 sectors namely the health, economic, marine, social and infrastructure sectors. The waived fees include:

  • The Health sector: Fees for medical training and education activities, school’s awareness campaigns, health services & first aid.
  • The Economic sector: Sales fees for goods, contracts, services, promotions, and property rentals, and fees for a set of permits, licenses, and tickets related to commercial and tourism activities, etc.
  • The Maritime sector: services related to the issuance of residencies, establishment certificates, and business cards.
  • The Social sector: entrance fees for entertainment and service facilities such as heritage sites, public libraries, and others.
  • The Infrastructure sector: some engineering supervision services, electronic registration, vehicle traffic, and others.

The announcement was an outline and further details will be coming out soon as the business community eagerly awaits.

Sheikh Hamdan said the directive of His Highness Sheikh Mohammed bin Rashid reveals his keenness to measure governance performance, assess the needs and provide all the elements necessary for continuous success. “The role of the government is to promote Dubai to the rank of the most advanced and happiest cities in the world,” said Sheikh Hamdan. “It is also tasked with serving the people and providing a conducive environment to achieve the wellbeing of the members of society and cement happiness. That is why we need to periodically review the existing legislation and policies to keep pace with the changes and maintain the sustainability of our development journey,” he added.

The council additionally vowed to pursue further development initiatives that harness all potentials to meet aspirations and achieve more. This can only be viewed as a sign of further impetus to the business community in the days to come.