The United Arab Emirates (UAE) is the second largest foreign direct investment (FDI) recipient in the West Asia region, in accordance with UNCTAD's 2015 Global Investment Report. FDI inflows reached USD13 billion in 2014.

The UAE ranked 60^th in the World Bank's 2016 Doing Business rankings, falling from 57^th in the year prior. Despite the slight fall in position, the rankings recognised a number of reforms enacted in 2015 which made doing business easier. This included making dealing with construction permits easier by streamlining the process for obtaining the civil defence approval. The UAE also made enforcing contracts easier by implementing electronic service of process, by introducing a new case management office within the competent court and by further developing the “Smart Petitions” service allowing litigants to file and track motions online. Further reforms were made in the categories of Dealing with Construction Permits and Getting Electricity.

Key facts about starting a business in the UAE:

• It takes six procedures and approximately eight days to start a new business in the UAE; this process is detailed in the Doing Business in chapter
• Once an employee enters the UAE on an entry permit, obtaining a labour card takes up to 30 days; employment regulations are discussed in detail in the Labour chapter
• Requesting and obtaining a building permit and all other associated approvals takes approximately 25 days and costs AED11,203
• All UAE incorporated entities must prepare statutory financial statements in accordance with the International Financial Reporting Standards (IFRS); further details can be found in the Audit chapter
• Companies that wish to list securities in the UAE can choose between the Dubai Financial Market, the Abu Dhabi Securities Exchange and NASDAQ Dubai; this is discussed further in the Finance chapter

The UAE's attractiveness as an investment location can be attributed to a number of factors, including its limited taxation, excellent infrastructure and cheap and flexible labour force. Nevertheless, in order to make an informed decision, it is critical to understand the nuances of any local regime. The manner in which people conduct business in the UAE may differ from the home countries of investors. Furthermore, variations on these distinctions may exist depending on the Emirate and the industry in which a company operates.

The UAE's official language is Arabic, although English is widely used in business. Business attire is conservative. A handshake is the typical business greeting and will be used at the beginning and end of a meeting. Punctuality is expected. Business cards will usually be presented after initial introductions. Gift giving is not expected as part of business interactions.

Those looking to establish a business in the UAE may look across the Middle East for alternative options. However, the UAE can be differentiated on the following factors:

• Political and economic stability; GDP growth of three per cent in 2015
• The UAE is strategically located between Asia, Europe and Africa, in close proximity to some of the world’s fastest growing economies
• The World Bank rated the UAE's judicial processes 13 out of 18, above the OECD high income average of 11; details of the country's judicial processes can be found in the Legal overview
• The UAE has almost no federal taxation legislation; this is further detailed in the Tax chapter
• Ranked first in the world for the quality of its transport infrastructure; further details can be found in the Infrastructure chapter
• Free Zones offer a number of incentives, including 100 per cent foreign ownership; discussed further in the Trade chapter

While there are significant opportunities for investment in the UAE, a number of challenges remain. Each Emirate has its own regulatory system which means that the interaction of federal, individual emirate and free zone laws can be complex. Furthermore, restrictions remain on foreign ownership of companies outside the Free Zones, with a national sponsor required to own 51 per cent.

This guide has been developed to provide businesses with an overview of the UAE, its legal regime, start-up and market entry considerations, tax and customs requirements and a general summary of the factors that may affect the decision to do business in the UAE. However, the information contained in this document is generic in nature and you should not act or rely on it without obtaining specific professional advice.

Please note that the Country Guides may only be available in English.

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