According to the UKTI the United Arab Emirates is the UK’s largest civil export market in the Middle East. In 2013, the Government’s most recent figures, British exports to the country reached £5.8billion, a 13 per cent hike on 2012.
There are over 5,000 British companies operating in the UAE, including BP, Shell, Rolls Royce, BAE Systems, SERCO, Standard Chartered, HSBC and RBS. 779 commercial agencies and 4,762 British brands have invested in the UAE.
Top exports include power generating machinery and equipment, road vehicles, telecoms and scientific instruments
The UKTI said the main incentives for British businesses to export to UAE included no taxation on personal income and capital gains, English widely spoken and accepted as the language of business, a large expatriate population and one of the most liberal trade regimes in the Gulf.
Each Emirate retains control of regulatory powers. This covers commercial activities such as issuing of trade licences and the incorporation of corporate entities, where the activity is not already regulated under federal legislation. However the interaction of federal laws, individual emirate laws and free zone laws can be complex and confusing.
Other challenges include restrictions on company ownership by non-Gulf nationals. However the UAE has a number of free trade zones which allow 100 per cent foreign ownership and a nil taxation regime.
The UAE, like most Middle Eastern states, is best known for its oil and gas industry. Abu Dhabi is its energy hub given its high proportion of hydrocarbons. Dubai has far less oil and gas reserves so has worked hard to diversify its economy particularly in business, finance, logistics, media and leisure.
Overall in the UAE non-oil and gas income now accounts for 70 per cent of GDP compared to previous levels of around 90 per cent.
UK companies considering setting up in UAE should take legal advice first especially on matters such as intellectual property and tax. For information on issues such as commercial agents and ownership rules contact the UKTI.
Keep an eye out for our UAE series as we take a look at the opportunities in a variety of sectors…