Doing Business in UAE Compare to Other Countries

Doing business in UAE

UAE, A federation of seven Emirates, is a federal, independent, and sovereign state. It is under the Constitution of the United Arab Emirates that came into effect in December 1971. The seven Emirates include Dubai, Abu Dhabi, Sharjah, Ajman, Ras-Al-Khaimah, Fujairah, Umm al-Qaiwain. Around 85% of the residents of the country are foreigners and around 95% of the people are ex-pats.

UAE is best known for its diversity and dynamicity, highly-developed infrastructure, the vibrancy of cultures and religions, high-quality medical facilities, and rich lifestyle. It is an economic hub of the Middle East, also known as a business-friendly country in this region. There is a significant presence of small and big companies in the UAE from different regions and continents of the world.

In the World Bank’s Doing Business Report of 2020, UAE ranks at 16th position and among the Arab countries, at the first position. This is primarily because of the business setup services in Dubai and successful business regulatory reforms to make the operations of businesses easier and better. If we track the major contributors to UAE’s popularity in the Ease of Doing Business survey, it is because of the factors such as reduced fees of business incorporation, measures for minority investor protections, drop in the time for import and export due to digitalization, and adoption of a risk-based approach for construction permits and inspections.

How is UAE Different from Other Western Countries for Business?

The best part about UAE is the diverse and dynamic workforce and people living in the country. UAE provides the right mix of different cultures and business practices because of the rising number of immigrants in it. There are fewer administrative restrictions in the country as compared to many other Western nations.

The UAE locals mainly believe in brands. They believe buying branded items is a status symbol socially. Therefore, business setup in UAE becomes difficult for start-ups and small businesses. Even if you introduce new ideas, new products, new technologies, and new processes, it becomes difficult to get a good number of customers, since brands are still a priority among the people living in UAE.

There is a higher prevalence of family-based businesses in UAE. In addition, they pay a lot of importance to business relationships. Therefore, you need plenty of effort for building business associations. The major factor that differentiates UAE from other Middle Eastern countries is that they are not dependent on oil and gas reserves only for their revenues. Tourism and financial industry, and allied fields are great contributors to the economy.

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How Different are UAE and Saudi Arabia?

UAE is quite different from Saudi Arabia in terms of political nature, economic scenario, and many other factors. The key factors that differ in the business environment in UAE and Saudi Arabia work in the all the company formation areas such as LLC Company formation in Dubai, and Mainland company formation in Dubai. Following are the key factors:

  • In UAE, each Emirate is ruled by an Emir and the Emirs of seven Emirates are part of a Federal Supreme Council, who together take major decisions such as the selection of the President and Prime Minister. On the other hand, Saudi Arabia is ruled by a King and no other person holds any power in decision-making for the country.
  • Another big difference is the population composition. While Saudi Arabia mainly comprises Arabics, UAE has a cosmopolitan culture because of immigrants from different parts of the world.
  • A key difference is a dependency on oil and gas reserves. While UAE has other sources of income such as tourism, the financial sector, and the hospitality industry, Saudi Arabia’s economy is mainly based on oil reserves.
  • Saudi Arabia’s welfare plans for its citizens are almost negligible while UAE is supportive of its citizens through free healthcare, the best education facilities, and high employment opportunities for its people.
  • Especially the ease and record time you need in establishing your business in the Emirates is considered the fastest, as the government’s approach to using smart systems and developing them is one of the government’s priorities.
  • And as mentioned above the high rate of the state’s reliance on foreign workers, in turn, allows investors to easily attract skilled and specialized workers and obtain work permits.

These are some of the factors, which make the UAE a better and more attractive option. It makes it easy for individuals and businesses for doing business in Abu Dhabi.

Why UAE is a Good Investment Hub for Foreign Investors?

UAE has implemented favorable measures to encourage investors in UAE and to increase employment opportunities in the country. Specifically, the flexible rules regarding property investment have encouraged a good amount of investors’ interest in the country. Furthermore, relaxation in taxation, repatriation of funds, and a pro-business climate make it an attractive investment option in areas like offshore company formation in Dubai.

UAE’s stable political environment for a long time. Its strategic geographical location makes it a striking investment base for companies and individuals. Other factors such as accessibility to low-cost energy options, efficient labor at low prices, rich reserves of hydrocarbons, and strong infrastructure for transport and manufacturing also contribute to its attractiveness. Some of the industries with high potential to attract the highest investments are gold, financial services, and retail trade. It also includes real estate property, manufacturing, and mutual funds.

The government passed the law in 2020, which enlisted 122 economic activities in which 100% FDI is permitted in all the areas of formation along with Freezone company setup in Dubai. This law opened the doors of UAE for further investment opportunities. It specifically caters to the categories of education, healthcare, services, renewable energy, agriculture, hospitality and food, and manufacturing. If not on the mainland, then free zones are always available for 100% ownership in businesses.

The issuance of a law in 2020 that grants golden residency to some segments of investors and work on drafting a new law for granting citizenship to them according to specific criteria.


We are sure that reading this makes you think of investing in the country. If you still have more questions on the benefits of investing in UAE, you can discuss them with us. We can provide you with the required relevant consulting on doing business in UAE.


1. What is better among the mainland, free zone, and offshore for doing business in UAE?

Any company in UAE, whether established in the mainland or any of the free zone, or as an offshore company has specific pros and cons. If you are unable to decide, you can contact us and have an initial discussion on your goals and your expectations. Based on the discussion, we can give you relevant suggestions and help you in company formation in UAE.

2. What are the fees and taxes that a company has to pay for doing business in UAE?

In UAE, the business is charged one-time registration fees, annual license renewal, and lease renewal costs. Besides these, there is 0% or 5% VAT; the rate is dependent on the goods and services you provide.

3. Do you help in setting up a business in all the emirates of UAE?

Our services in setting up a business in UAE include forming a company in any of the emirates of the country. Our services also extend to other countries across the world.

One-stop solution for your company formation requirements – NR Doshi & Partners.

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