Kavan Choksi UAE Explains the Investment and Trade Scenario in UAE


For multiple decades now, UAE has continued to be on top of the world as one of the most critical trading hubs. UAE is rated consistently as one of the most competitive Arab economies and a place where ease of doing business ratings ishigh. UAE has very strong trading relationships with both east and the west. UAE is also a strategic hub in the ‘21st Century Maritime Silk Road’, an initiative by China.

Kavan Choksi UAE on trade scenario

UAE comes up in the list of the top 20 global exporters ad also a leading player in commodity import. Back in the 2019 budget, the trade represented about 161% of the overall UAE GDP. Along with oil and gas, Kavan Choksi UAE says thattrade in the non-oil sectors is also rising steadily, which is an encouraging sign of the diversification ambitions of the country.

The free zones and the member companies out there continue to expand their business, and many of those are enjoying the benefits of being at a free zone with ease of doing business, tax-free functioning, etc. There are a few trade zones also, which act as the cornerstone of the country’s success. Even though located in special zones, they can function as in the mainland and enjoy all privileges of a front-line native business.

Along with many other benefits of the free zone, one key benefit is the ready access to all kinds of business services supported at a one-stop-shop for UAE bureaucracy. For example, the Dubai Multi Commodities Centre offers pro bono legal services to the companies and various connected apps for ensuring compliance with the UAE regulations.

Ease of doing business

UAE always rated on top of the ease of doing global business ratings. In the same report, the UAE is also ranked top on the list for ‘paying taxes’ and ‘getting unrelenting electricity.’ The government and the

trade departments are also consistently working towards ensuring the same.

By 2021, the restrictions that mandated about 51% of the share capital of the businesses functioning in UAE to be owned by UAE nationals had been removed. It now potentially permits 100% foreign ownership for any business to be set up in the ‘mainland’ UAE. However, the industries with ‘strategic impact’ are excluded from this privilege, and those were mandated to have a minimum shareholding in UAE and a board-level involvement in the administration of the business.

Investors planning to establish in the free zones can register their new company as a free zone establishment, a limited liability model governed by the special regulations of free zones, or can set up a branch office. However, there may not be any legal protection for the parent company, which is in the limited liability form. Any overseas business may also set up its branch in UAE, and the UAE branch needs to have to be a separate legal entity from the parent company.

For setting up a business in UAE free zones, one can take the expert advice of consultants like Kavan Choksi UAE, who possess many years of UAE business and trade consulting experience.

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