Saudi Arabia and Bahrain lead FDI inflow in Gulf region
Saudi Arabia and Bahrain headed the list of foreign direct investment (FDI) in the Gulf region with FDI inflows of US$3.2 billion and US$1.5 billion respectively, according to the World Investment Report (WIR) for 2019 compiled by the United Nations Conference on Trade and Development (UNCTAD).
FDI across the world dropped by 13% during 2018 to US$1.3 trillion. UNCTAD said this represents the lowest level since the global financial crisis and underlines the lack of growth in international investment this decade. However flows to developing countries remained stable, rising by 2%, while their share of global FDI increased to 54%, a record.
DMCC partners with DED to introduce dual licensing scheme
The Dubai Multi Commodities Centre (DMCC) signed a strategic agreement with the Department of Economic Development (DED) on 19 July to collaborate on the licensing of companies in Dubai. The partnership aims to further facilitate trade and boost economic activity in the emirate by allowing companies to operate within the Free Zone and onshore.
The new Memorandum of Understanding (MoU) introduces a dual licensing scheme to DMCC member companies, enabling them to establish a presence and operation in mainland Dubai under a DED licence. DED regulates the economic activity of all onshore companies in Dubai.
DIFC introduces new Employment Law
The Dubai International Financial Centre (DIFC) brought its new Employment Law – DIFC Law 2/2019 – into force on 28 August. The Law, which repeals and replaces the Employment Law 2005 (DIFC Law 5/2004), supports the DIFC’s commitment to international best practice by addressing key issues for both employees and employers including paternity leave, sick pay and end-of-service settlements.
RAKEZ Business Women Package – Inspiring female entrepreneurship
To celebrate Emirati Women’s Day on 28 August, the Ras Al Khaimah Free Zone (RAKEZ) launched a new Business Women Package for female entrepreneurs, which is a ‘first-of-its-kind’ product in the UAE designed exclusively for women who are passionate about business.
Businesswomen who want to set up their company with the economic zone can select either a one-year or three-year package, starting from AED 6,200 with the option of an instalment plan. Both packages come with value-added services such as free usage of RAKEZ shared workstations, free printing of business cards, priority tokens at RAKEZ Service Centres and eligibility for a UAE Residence Visa(s).
UAE relaxes foreign ownership restrictions and introduces substance requirements
The UAE Cabinet announced on 2 July that a Resolution had been passed approving the ‘positive list’ of 122 specific activities across 13 business sectors in the UAE that are now eligible for up to 100% foreign ownership.
The Cabinet issued the Foreign Direct Investment Law (Federal Decree Law No. 18) in September 2017, which provided a framework for the relaxation of the majority shareholder requirement in specific licensed activities and business sectors to be detailed in supplementary legislation.
UAE ratifies the Multilateral BEPS Convention
The UAE deposited its instrument of ratification for the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI) with the OECD on 29 May 2019.
The MLI is a multilateral treaty that enables jurisdictions to swiftly modify their bilateral tax treaties to implement measures designed to address multinational tax avoidance. These measures were developed as part of the OECD/G20 Base Erosion and Profit Shifting (BEPS) project.