The United Arab Emirates (UAE) is a federation of seven emirates that was formed on 2 December 1971.The UAE government has successfully managed to create a business environment that is conducive to economic growth. This has helped promote the UAE as an international centre for trade, finance and services, attracting reputable global companies.

The most common way of selling goods and services in the U.A.E. is through a commercial agent. 


Alternatively, under U.A.E. law, there are several types of business establishments applicable to foreign entities interested in establishing a more formal presence in the U.A.E.: Joint Ventures/Licensing, Establishment of Branch Offices, Free Trade Zones, and Civil Companies. 
 
The Commercial Companies Law requires that each limited liability company established in the U.A.E. have one or more U.A.E. national partner(s) who hold at least 51 percent of the company’s capital.  Certain companies that undertake stipulated activities are exempt from the 51 percent requirement, including oil companies with concession agreements, companies involved in the oil and gas industry, companies that produce electricity and gas, companies involved in treatment of water and transmission and distribution.  Foreign banks are exempt from having to appoint a sponsor.  Companies established in free zones are, as noted above, also exempt from the 51 percent requirement.  Other sales methods include direct sales to the end-user, establishment of a joint venture with a local firm, contracting with non-exclusive resellers, or selling through a licensing or franchising agreement.
 
Food imports are typically handled by firms specializing in import and distribution of food products to wholesalers, retailers and institutions.  However, currently the government has removed the monopoly of agents and has opened up the sector. 
 
The terms and conditions of any contract should be clearly defined.  The contract should include the geographic territory to be covered by the agent, verification of licenses given to the agent to operate and the terms of the expiration and termination of the agreement, all of which must be agreed upon in advance.  This makes a competent attorney to advise you indispensable.

Services

  • Analysis and identification of the right target market and region, to operate on the basis of regional experience and laws

  • Market research

  • Business modelling for market entry with scenario analysis to support strategies and decisions

  • Identification of local partners required to operate in the Middle East

  • Incorporation services

  • Relationship building with regional companies

Modes of Setting up a Business in the UAE


The UAE offers an investment environment that is among the most liberal and attractive in the Gulf region. Economic activities in the country are regulated by the federal government as well as by individual emirates.All business activities are primarily covered by three categories of licences:

  • Commercial licence covering all kinds of trading activities

  • Professional licence covering professional services, other services, craftsmen and artisans

  • Industrial licence to establish an industrial or manufacturing activity

Market entry

The main criteria to enter the markets within the Middle East in a successfull way are visiting the country; importance of relationships to finding a good partner; use of agents and right incorporation:

  • Distributors/Agents: In most sectors, foreign firms seeking to establish themselves within the U.A.E. market must have a local sponsor or agent and are limited to a minority ownership position.  Finding the right local agent/distributor can be a critical first step for success.

  • Competitive Positioning:  As a regional trade hub supporting intense international business activity, the U.A.E. is a market where western firms can expect to face strong, multi-national competition. Many successful firms rely on technological and qualitative advantages to compete with often less expensive foreign competition from the Far East.

  • Regional Approach: Western firms looking to do business in the Middle East may find that a regional approach to their marketing activities in the Gulf will offer certain practical advantages. The members of the Gulf Cooperation Council (GGC), which is consists of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the U.A.E., have taken steps to unify some industrial standards and other measures to harmonize regulatory structures. The region is also one of the largest and fastest growing export markets for western goods and services.  On January 1, 2015, the GCC customs union came into full effect, charging a 5 percent tariff on most goods across the member countries.

  • Trade Shows:  Dubai, as a regional commercial hub, hosts world-class trade exhibitions and conferences, where western firms can meet buyers from the Middle East, Africa and South and East Asia.  There is also a growing number of trade shows in Abu Dhabi.

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Genesis Marketing and Trade Consulting FZ LLC., registered at: RAS AL KHAIMA Free Trade Zone, Office No F 26, PO Box 10559, United Arab Emirates

 

Office Address:

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Business Bay, Dubai – United Arab Emirates

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