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DUBAI

H.H. Sheikh Hamdan bin Rashid Al Maktoum

Deputy Ruler of Dubai


Having expanded along both banks of the Creek, Dubai’s central business district is divided into two parts — Deira on the northern side and Bur Dubai to the south — connected by a tunnel and two bridges. Each has its share of fine mosques and busy souks, of public buildings, shopping malls, hotels, office towers, banks, hospitals, schools, apartments and villas. Outside this core, the city extends to the neighbouring emirate of Sharjah to the north, while extending south and west in a long ribbon of development alongside the Gulf, through the districts of Satwa, Jumeirah and Umm Suqeim. At first glance, the city presents a predominantly modern face, an ever-changing skyline of new developments, from striking glass and concrete towers to gracious modern buildings incorporating traditional Arabian architectural motifs and features.

HISTORY Originally a small fishing settlement, Dubai was taken over in about 1830 by a branch of the Bani Yas tribe from the Liwa oasis led by the Maktoum family who still rule the emirate today. Traditional activities included herding sheep and goats, cultivating dates, fishing and pearling, but the inhabitants built up trade too. By the turn of the century, Dubai was reputed to have the largest souks on the Gulf coast, with 350 shops in the Deira district alone. Commercial success allied to the liberal attitudes of Dubai's rulers, made the emirate attractive to traders from India and Iran, who began to settle in the growing town. But, while trade developed, Dubai remained politically a protectorate of Britain as part of the Trucial States extending along the northern coast of the Arabian peninsula. On the British withdrawal in 1971, Dubai came together with Abu Dhabi, Sharjah, Ajman, Umm Al Quwain, Fujairah and (in 1972) Ras Al Khaimah to create the federation of the United Arab Emirates. This was shortly after the discovery of oil in 1966, which was soon to transform the emirate and its way of life. Dubai's first oil exports in 1969 were followed by a period of rapid development that laid the foundations for today's modern society. Much of the credit for this development can be traced to the vision of the late Ruler, HH Sheikh Rashid bin Saeed Al Maktoum, who ensured that Dubai's oil revenues, despite being relatively modest by the standards of the region, were deployed to maximum effect. His work has been continued by the present Ruler, HH Sheikh Maktoum bin Rashid Al Maktoum, and his brothers, Their Highnesses Sheikh Hamdan bin Rashid Al Maktoum, Deputy Ruler of Dubai and UAE Minister of Finance and Industry, and General Sheikh Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai and UAE Minister of Defence. The result is that Dubai is constantly building up its infrastructure of transport facilities, schools, hospitals, tourism developments and other amenities of an advanced society.

Captivating Contrasts From the timeless tranquillity of the desert to the lively bustle of the souk, Dubai offers a kaleidoscope of attractions for visitors. The emirate embraces a wide variety of scenery in a very small area. In a single day, the tourist can experience everything from rugged mountains and awe-inspiring sand dunes to sandy beaches and lush green parks, from dusty villages to luxurious residential districts and from ancient houses with windtowers to ultra-modern shopping malls. The emirate is both a dynamic international business centre and a laid-back tourist escape; a city where the sophistication of the 21st century walks hand in hand with the simplicity of a bygone era. But these contrasts give Dubai its unique flavour and personality; a cosmopolitan society with an international lifestyle, yet with a culture deeply rooted in the Islamic traditions of Arabia. Since earliest times, Dubai has been a meeting place, bringing together the Bedouin of the desert interior with the pearl-diver, the merchant of the city with the sea-going fisherman.

Climate The UAE has a sub-tropical, arid climate. Rainfall is infrequent and irregular. Falling mainly in winter, it amounts to some 13 centimetres a year. Temperatures range from a low of about 10 degrees Celsius to a high of 48 degrees Celsius. The mean daily maximum is 24 degrees in January rising to 41 degrees in July.



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DUBAI BUSINESS GUIDE

AGCC Customs Exemption According to the AGCC Unified Economic Agreement drawn up on 8 June 1981, products originating in any AGCC state are exempted from customs duty (and other charges having an equivalent effect) in any other AGCC state. However, to qualify as national products, the value added ensuing from their production in member states must not be less than 40% of their final value and the factory must be licensed by the Ministry of Finance and Industry. In addition, the share of the member state citizens in the ownership of the producing plant must not be less than 51% unless the ownership is 100% AGCC. Every item for which exemption is claimed must be accompanied by a certificate of origin duly authenticated by the appropriate government agency.

Tenders In Dubai, government projects and orders are generally put out to tender. The required qualifications, specialisations and other terms and conditions for participation vary according to the project and the authority concerned. Certain tenders are offered internationally but where local tenders are involved only those companies licensed and registered with the department concerned are eligible to bid. In order to qualify to participate in a tender one or more of the following may apply:

  • The tenderer shall be a firm wholly owned by UAE nationals. In the case of a partnership, at least 51% of the equity must be owned by UAE nationals. A foreign party may only tender if it has a UAE representative or agent with the necessary documents;
  • The tenderer should hold a valid licence from the Economic Department;
  • The tenderer must be a member of the Dubai Chamber of Commerce and Industry.

Trade Regulations and Practices Imports into Dubai can only be undertaken by those importers who have the appropriate trade licence. Import duties have been largely standardised at 4%, but there are many exemptions, including food, building materials, medical products and any item destined for the Jebel Ali Free Zone. Food products must carry dates of manufacture and expiry and meat for the local market must have a certificate to prove compliance with Islamic law. Trade practices in Dubai are in line with normal international standards. All correspondence should be in Arabic or English. As a sophisticated market, full technical specifications should be provided with CIF Dubai prices and Middle East references. Payments are normally effected by letter of credit. The UAE is a signatory of the General Agreement on Tariffs and Trade (GATT).

Visas The UAE Federal Authorities are primarily responsible for all immigration matters, and visitors are advised to consult their nearest UAE embassy or consulate if in doubt about visa requirements. Information can also be obtained from the overseas offices of the Department of Tourism and Commerce Marketing. In general, all visitors, except transit passengers who do not leave the airport on arrival and citizens of the Arab Gulf Cooperation Council states - Bahrain, Kuwait, Qatar, Oman and Saudi Arabia - must obtain visas sponsored by a local entity such as a hotel, company or travel and tourism firm to enter the UAE. However, British citizens with the right of abode in the UK and AGCC residents of certain qualifying nationalities and professions are issued automatic 30 day visas on arrival, and German and US citizens may obtain multiple entry visas from UAE Embassies. Visas are easily obtainable for other visitors except for Israelis and travellers whose passports bear Israeli stamps. A business visitor may enter Dubai with either a transit visa or a visit visa. Both types of visa require the sponsorship of a company or hotel licensed to operate within the UAE. A transit visa entitles its holder to a stay of 14 days exclusive of arrival and departure days. A visitor planning a longer stay in the UAE may prefer to enter the country with a visit visa which entitles him to a stay of 30 days renewable twice up to a total of 100 days including a grace period of 10 days. A visit visa further entitles its holder to change his status to that of residence or employment provided certain conditions are met. A visa holder may enter and leave the country through any port of entry in the UAE. Airlines may require confirmation that the sponsor is holding a valid visa for the incoming visitor.



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Banking and Finance The regulatory authority since 1980 has been the UAE Central Bank. Some 47 commercial banks operate, with a total of around 350 branches, of which about 28 are foreign banks with a combined total of more than 200 branches. Federal law restricts foreign banks to no more than eight branches each. Federal law requires that every commercial bank must have a paid-up capital of at least Dh 40 million. There are few investment or merchant banks at present. For medium-term or long-term industrial finance, local companies can approach the Emirates Industrial Bank, set up by the UAE government with an initial capital of Dh 500 million. Its main objective is to help develop the private sector. Bill discounting can be arranged with the commercial banks, either foreign or locally owned. Leasing and hire purchase are available from local finance companies specialising in this business. Factoring is not practised in the UAE. Import and export financing can be arranged through the commercial banks. Margins are often required by the banks. Such margins and the facilities offered by the banks will mainly depend on their relationships with their customers.

Exchange Control There are no exchange controls in the UAE and its currency, the UAE dirham, is freely convertible. The dirham is linked to the US dollar, the currency in which oil revenues are paid. The current exchange rate is Dh 3.675 = US$ 1 and no revaluation has occurred since 1977.

Taxation There is no corporate tax in Dubai. The only exceptions to this are oil producing companies and branches of foreign banks. Likewise, there are no personal taxes. Direct taxation is against the traditions of the UAE and it is highly unlikely that it will be introduced in the near future.

Accountancy The registration of accountants and auditors in the UAE is governed by Federal Law No.9 of 1975. There is no local professional body of accountants but many of the large international accountancy firms have offices in Dubai. Under Federal Law No.13 of 1988, as amended, all businesses are required to keep financial records but current legislation is not specific as to the nature of such records.

Land Ownership Foreign companies and individuals are not permitted to own land or real estate in Dubai. All property must be rented or leased for the purposes of running a business.

Trade Marks and Patents Towards the end of 1992, the UAE President enacted three Federal Laws on the protection of industrial and intellectual property. These laws came into effect in 1993 and provide protection against commercial piracy and fraud. The laws are: Federal Law No. 37 of 1992 on Trademarks, Federal Law No. 40 of 1992 on Protection of Intellectual Property and Copyright, and Federal Law No. 44 of 1992 on Protection of Industrial Property.

Legal System There is a comprehensive framework of legislation to ensure that business in the UAE is conducted in a fair and orderly manner. There are laws dealing with commercial transactions, intellectual property, labour and other aspects of business life. Dubai has many local and international law firms willing to advise foreign business organisations on legal matters. There are Federal Courts in all emirates except Dubai and Ras Al Khaimah, which have retained their local courts. Dubai has civil, criminal and Shariah (Islamic) Courts of first instance. All court decisions may be brought to the Dubai Court of Appeal. Thereafter, a final appeal may be made to the Dubai Court of Cassation. The Civil Court (as opposed to the Shariah court) has jurisdiction over labour, civil and commercial transactions, as well as personal matters (e.g. wills, divorces etc) relating to non-Muslims. The language of the Courts is Arabic and advocates admitted to plead are Arab nationals.

Health requirements No health certificates are presently required for entry to Dubai, although it is as well to check before departure, as health restrictions may vary, depending upon the situation at the time.

Customs Duty-free allowances: cigarettes - 2,000; cigars - 400; tobacco - 2kg; alcohol (non-Muslim adults only) - 2 litres spirits and 2 litres wine; perfume - a reasonable amount. No customs duty is levied on personal effects entering Dubai. The Dubai Duty Free Shop has a sales outlet in the Arrivals Hall of the airport but alcohol may only be purchased on departure.



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