Why trade or invest in Dubai, UAE ?

DUBAI, UAE THE WORLD WITHIN A COUNTRY

The UAE is often referred to as a country of the future.

Dubai attracts millions of visitors and real estate transactions that are worth billions of US dollars every year, so there is practically no downside to investing in this dynamic city with endless beautiful scenery, sunshine and striking new landmarks.

Whether you’re seeking to expand your existing operation or looking to launch a new business venture, Dubai has a solution for every structure, budget and industry.

Dubai offers a wealth of opportunities for those seeking to invest. The Middle East, Africa and South Asia (MEASA) region is home to over three billion people, ever-increasing mobile connectivity and increasing levels of trade and investment. MEASA is demanding ever more widespread and sophisticated financial services, which represents an opportunity for innovative companies within the financial sector.

As trade and investment increase, there will also be a growing market for wholesale banking and capital markets. This underpins Dubai’s place on the worldwide map as the de facto hub between all of the major markets within the region, and that is why more than US$350 billion of trade flows through Dubai every year.

A large proportion of the population remains unbanked and the potential for fintech companies/products is vast. With continued growth, wholesale banking and capital markets will become increasingly important and Dubai’s position as a global trade hub places it in advantage position.

Real estate

Dubai as a city offers higher rental yields than many other mature real estate markets.

On average, investors can achieve gross rental yields between 5-9%. Property prices per square foot are lower than many other cities globally, making Dubai an affordable location to own prime real estate.

Major benefits are:

• Easy to Purchase Property
• High Capital Appreciation
• High Rental Returns
• Zero property Tax
• Long Term Residency Visa (10 years)
• Safe & Secured Environment
• Cosmopolitan Lifestyle
• Close proximity to the world

Dubai Free Trade Zone's (FDZ)

Setting up a business in a free zone is relatively simple. Free zone authorities require minimum paperwork and duration. Here are the key steps to set up a business in a free zone:

- Determine the type of legal entity
- Choose a trade name
- Apply for a business licence
- Choose an office space
- Get pre-approvals, register your business and get your licence
- Determine the type of legal entity

Determine the type of legal entity your business would take up. In a free zone, you can set up one of the two types of companies: Free Zone Limited Liability Company (FZ LLC) or Free Zone Company (FZ Co.)

Capital requirement

There is no minimum capital requirement at twofour54, a media and entertainment zone in Abu Dhabi.

In KIZAD, you can form an LLC for which the minimum paid-up capital should be AED 150,000.

In Dubai Airport Free Zone, you can form an FZ Co. with a minimum share capital of AED 1000. Each share should be in the denomination of AED 1000.

In DMCC, the minimum share capital for forming a free zone company is AED 50,000 per company and AED 10,000 per shareholder. For a company to be issued a General Trading Licence, it should have a minimum of AED 1 million share capital.

In Hamriya Free Zone, you can form an FZE with a share capital of AED 150,000.

Dubai as a financial hub

Filling the time-zone gap between the leading financial centres of London and New York in the West, and Hong Kong and Tokyo in the East, DIFC stimulates trade and investment flows along the South-South economic corridor. The Centre will triple in size by 2024 and establish a world-class financial destination by deepening and broadening impact for constituents and global sectors, and investing in innovation.

Ensuring best in class  regulatory and judicial framework, DIFC is made up of the Dubai Financial Services Authority (DFSA) and the legal bodies of Dubai Courts, the DIFC Courts and two arbitration centres, Dubai's branch of the London Court of International Arbitration (DIFC LCIA), and the Dubai International Arbitration Centre (DIAC).

A vibrant banking and trade sector

DIFC hosts 17 of the world’s top 20 banks, seven of the top law firms and 13 of the world’s most prestigious wealth and asset management companies. It is the preferred regional hub for some of the world’s most reputable banking institutions, including Barclays, Citibank, HSBC and Standard Chartered, which collectively operate 85 branches in the city, while credit card giants Visa and MasterCard are also headquartered in Dubai.

Opportunities for investors and venture capitalists

Dubai is home to the highest number of investors and venture capitalists in the region. Crowdfunding platforms and lower-cost portfolio products have opened up investment, and are giving middle and lower-middle-income citizens the ability to become investors. Growth in the provision of credit, an increasing interest in private equity and a rise in venture capital are also helping to drive growth in the middle market.

Dubai-based VCs are also contributing to the fintech surge: Wamda Capital, founded in 2014 and one of the most active VCs in the UAE, invested US$17.4 million in financial products comparison website YallaCompare, and has also launched a US$100 million fund named WamdaX; and BECO Capital has broadened its exposure to FinTech, investing US$3.5 million in insurance comparison site Bayzat.

Fintech

As technology is transforming the way financial transactions are enabled and completed, Dubai is taking the lead in the region’s fintech sector with a wealth of start-ups setting up operations in the city. In the Middle East and North Africa alone, fintech start-ups have raised more than US$100 million in funding over the last decade. 

With Dubai today recognised as one of the world’s top ten fintech hubs and number one in the region, the DIFC is spearheading the city’s innovation ecosystem, and is well placed to drive growth. One such initiative is a low cost Innovation License. Offered to technology enablers, it caters to firms that fall under FinTech, RegTech, InsureTech; and other SMEs interested in developing or testing new, novel or innovative products.

E-commerce

Dubai’s e-commerce sector is realising huge growth potential in Dubai, with the value expected to reach US$27.2 billion in 2020 in the UAE alone. A series of reforms and government measures to stimulate growth are set to drive UAE’s gross domestic product to pass the US$500 billion mark over the next few years.

 

For further details on the above, doing business in Dubai, UAE or on our services on Dubai, UAE please consult Legal Counsel for UAE, Semanta Hoti on s.hoti@a-law.eu or fill in our online contact form.