Month: May 2020
UAE Federal Law on Foreign Direct Investment
Lavin Nalinababu, Business Consultancy
Phone:- +971 4 327 7775
Mobile:- +971 55 160 1291
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
The UAE government had come up with a landmark initiative last year, allowing complete ownership to foreign investors. Along with 100 percent ownership, the law also grants many incentives & competitive advantages. It is not applicable to financial and non-financial free zones.
Benefits and Guarantees
- The property won’t be confiscated unless it is for public benefit and with a fair compensation.
- Project funds won’t be seized without a court hearing.
- The licensed foreign investment firms will be treated like national firms
- Financial transfers can be made for project returns outside UAE.
- Technical, economic and financial information and investment initiatives will remain confidential.
- The right to use real estate.
Additional privileges
- A single or numerous partners can be involved.
- Ownership can be transferred to a new investor.
- Changes can be made to the articles of association.
- The legal form of the organization can be changed.
- Can carry out merger, acquisition or liquidation.
Steps involved in licensing an FDI Project (from positive list)
- Choose the business activity of the firm
- Once you receive the initial approval, a foreign direct investment license application should be submitted.
- Reserve the trade name. An indication of the legal form of the company and the expression ‘Foreign Direct Investment (FDI)’ must follow the name of the company.
- Obtain approvals from authorities concerned
- Submit proof of submission to join Tawteen Partners Club
- Pay the fee and get approval and FDI license
- Start a bank account on behalf of the company and deposit minimum 20 percent of the capital.
The FDI capital should not be less than the specified minimum capital value.
Procedures for approving a project license application that is not specified under the positive list
- The investor need to submit the application for approval of the project license to the competent authority of foreign direct investment. The authority will submit the request to the FDI committee for consideration, which might approve or reject the application. The licensing authority and the local government in the concerned emirate will be involved in the process.
- Once the request is submitted to the FDI committee, the committee will submit a recommendation to the UAE cabinet. If the cabinet approves the request, the same will be notified to the investor via the competent authority. The investor needs to provide certain data, information and documents once the request is approved.
- The competent authority will issue approval of the license with in five working days from the date of meeting the required documents and procedures.
- If the competent authority rejects the license request, the decision will be final and not subject to appeal.
Would you like to rate us on Google?
Related content
Get in touch
Whatever your question our team will point you in the right direction
Start the conversation
Sign up for HLB HAMT insights newsletters
Covid-19: Technology Opportunities
Vimal Ramachandran, Director
Phone:- +971 4 327 7775
Mobile:- +971 52 830 7998
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
The COVID-19 outbreak has brought about rapid changes around the world which has compelled governments to take drastic measures to contain its spread. Even though it has been creating havoc to people and businesses, it has also created numerous opportunities for one sector in general, and that is technology.
Technology Opportunities
- The rise of mobile and VoIP applications
- Data Protection
- Artificial Intelligence
- Cybersecurity
- Technology Contracts
- Innovation
- Increased online media consumption
- E-gaming
The rise of mobile and VoIP applications
The pandemic has forced numerous cities all over the world to enter into a lockdown and during a time like this the only way for people to go on with their lives and businesses is to rely on technology. People have started to spend more time on mobile apps and calling apps are being used for videoconferencing to schedule work meetings, home schooling or just to catch up with friends and family. These requirements have prompted regulators to remove blockers to the deployment of these solutions.
In Oman, the restrictions on Microsoft Teams, Zoom and Google Meet were lifted by TRA and Qatar unblocked Zoom, Microsoft Teams and Webex.
The UAE TRA unblocked Microsoft Teams and Zoom VoIP applications to enable remote working and home schooling. The restrictions on VoIp was eased in collaboration with Etisalat and Du and this is just a temporary measure. The move has helped lessen the disruption to businesses and have also enabled some to use online platforms to deliver their services.
KSA had recently established Saudi Data and Artificial Intelligence Authority (SDAIA), which hosted the Extraordinary Virtual G20 Summit. The Summit was successful in bringing together G20 leaders to discuss initiatives to combat the global spread o f the Covid-19.
Data Protection
Employers in the UAE can implement precautionary measures to protect their employees, but this must be done taking into consideration general provisions in the penal code and in the Constitution aimed at preserving the dignity and secrecy of an individual’s private life. For example, it may not be right to reveal the name of an employee who has contracted the virus. But, for the safety of others who have been close to this particular employee, disclosing the details might be deemed necessary.
Abu Dhabi Global Market (ADGM) has issued a guidance note recently stating that a data controller can process personal data in cases of emergency. But this data will have to be processed fairly, lawfully and securely, and only if it is adequate, relevant and proportionate for the purposes for which it is being processed.
The UAE has two laws specifically for the protection of health data, the Federal Health Data Law and the Heath Care Data Protection Law in Dubai Health Care City (DHCC).
The law in DHCC is applicable for organizations incorporated there and it protects patient health information from being disclosed to third parties without their permission. But again, the data can be used if it is “necessary to prevent or lessen a serious and imminent threat to public health or public safety”. The Federal Health Care Law also follows the same principle.
Artificial Intelligence
Dubai police is using AL solutions to distinguish between vehicles that have movement permits or the ones that are used by people working for important sectors from vehicles of people in breach of the lockdown.
Etihad Airways is depending on technology and automation to screen passengers for signs of COVID-19. Various groups are bringing together AI experts to combat COVID-19. Many have made AI tools available for free and launched hackathons to galvanize a community of developers, researchers and scientists.
Cybersecurity
Corona-virus themed attacks have been on a rise, specifically in the form of phishing emails. The World Health Organization (WHO) has warned people of phishing emails being sent in the name of the organization.
It has become the need of the hour to reinforce the information security system of organizations and adopt advanced analytics platforms to detect and resolve vulnerabilities.
Technology Contracts
The pandemic has resulted in a major disruption to the global tech supply chain across different sectors and made us realize the need to leverage and embrace technologies such as 5G, smart city solutions, AI and IoT. This will help us meet future global challenges such as the need for smart tools to identify virus hotpots and the requirement for remote communication. One can expect a growth in the adoption of these innovative technologies across international markets.
From a legal perspective, clients should take into consideration current and future transactions. Care must be taken while drafting future IT contracts in a COVID-19 environment.
Innovation
It is during crises like these, people come up with innovations. The UAE Ministry of Health is collaborating with telecom operator Du to set u a virtual hospital, that will provide remote care to patients on a virtual basis with the help of smart monitors or AI devices. COVID-19 has prompted the country to come up with an innovation like this. The initiative enables healthcare professionals to see and communicate with their patients and gain access to their data.
Hospitals in UAE have implemented telemedicine services to help patients without exposing them to the infection.
In KSA, The Ministry of Health established an e-Health strategy that includes the use of telemedicine. Telemedicine falls under Saudi Telemedicine Network project, a collaboration with Canada Health Infoway and Ontario Telemedicine Network.
Increased online media consumption
There has been a significant growth in the use of online media ever since the pandemic outbreak. Global media streaming platforms such as Netflix and Amazon Prime Video had to reduce traffic and definition to reduce the pressure on telecom service providers. Twitch, a live-streaming platform owned by Amazon has reported a growth of 75 % in the number of hours watched while compared to the last quarter. MBC’s VoD platform (Shahid) also witnessed a massive growth in its number of users and hours.
E-gaming
Almost all sporting events in UAE and across the globe have been cancelled due to the pandemic and people have started resorting to e-sports. Major brands realized the increasing interest users started showing towards online sports and have started to pitch in. The industry will hopefully continue its successful journey even after the pandemic is over.
The pandemic has imposed serious challenges on mankind. Majority of the population is working from home and schooling is also being done remotely. Even after we combat the crisis, some of the changes are here to stay. If virtual business meetings were successful during this time, then why spent your time and money on travel after the world is free of corona? Companies can reduce costs to a large extend, without any negative impacts on businesses.
More businesses will start adopting cloud computing technologies which will help them reduce their spent on IT infrastructure and scale-up their operations.
Would you like to rate us on Google?
Get in touch
Whatever your question our team will point you in the right direction
Start the conversationSign up for HLB HAMT insights newsletters
Business Diversification : Factors to Consider
Sumesh Krishna, Partner
Phone:- +971 4 327 7775
Mobile:- +971 50 749 0576
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
The impact of coronavirus on businesses has made us realize the importance of diversification. When a particular product or service suffers due to the pandemic, you still have others to rely on, and thus the risk factor reduces.
There are certain factors that you must look into before proceeding with the diversification strategy;
Financial sense
Many people believe in taking more significant risks to achieve higher returns and hence step into diversification. But, the result may not always be positive.
If you decide to go ahead with your current model, it is safe and cost-free; whereas diversification involves additional finance. For a smoother ride, a thorough analysis of the financial aspects of the diversification strategy is a must.
Core competencies of the firm
Business leaders should have a definite idea on the core competencies of their organization. This will help in continuing with the business without any interruption irrespective of any crisis. In some instances, it can also lead to the creation of more value to the business houses.
If you a not able to bring together your stakeholders under one roof due to the pandemic, possibilities of using technology to continue the service can be given a thought.
Evaluating the assets
If there are business assets that could be used for multiple purposes and if there is a market for the new service offering, then go for it. Let’s take the case of a vehicle rental company. They have a fleet of vehicles with them, from which some can be used for home delivery services. This will result in additional income and making cashflows without any extra investment.
The right expertise and resources
Once you make up your mind to expand the business, the next thing would be to question yourself whether you have the right expertise and resources to carry out the process successfully. If expanding requires you to bring in additional skills or expertise, the process should be planned cost-effectively.
Diversification doesn’t always require you to make drastic changes to your business plans. Sometimes, a small step will be sufficient to diversify the business. For example, if you run a training company, you can include new courses, and in the case of catering business, new categories or cuisine can be added. This way, the risk factor can be reduced as it does not involve any significant changes.
Diversification might sound little risky and painful, but if done correctly, the results will be wort h the effort.
Would you like to rate us on Google?
Related content
Get in touch
Whatever your question our team will point you in the right direction
Start the conversationSign up for HLB HAMT insights newsletters
Saudi Arabia Increases VAT to 15%
Jay Krishnan, Partner
Phone:- +971 4 327 7775
Mobile:- +971 50 677 5860
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
Saudi Arabia has decided to triple its VAT, from 5 percent to 15 percent. The measure is being taken to support the coronavirus-hit economy and it will be effective from July 1st.
Apart from this, the cost of living allowance will also be suspended, from 1 June. “These measures are painful but necessary to maintain financial and economic stability over [the] medium to long term and overcome the unprecedented coronavirus crisis with the least damage possible,” finance Minister Mohammed al-Jadaan said in the statement.
The pandemic and record low oil prices have forced the government to come up with emergency plans to reduce spending and save the economy.
Saudi Arabia had imposed VAT on goods and services in 2018 along with other Gulf countries, as a part of its economic diversification strategy. The VAT rate in UAE remains the same, despite the current crisis.
Would you like to rate us on Google?
Related content
Get in touch
Whatever your question our team will point you in the right direction
Start the conversationSign up for HLB HAMT insights newsletters
Dubai Expo 2020, new dates announced
Lavin Nalinababu, Business Consultancy
Phone:- +971 4 327 7775
Mobile:- +971 55 160 1291
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
Expo 2020 has been one of the most anticipated events that the entire world was looking forward to. But, unfortunately the current pandemic crisis has forced the organizers to postpone the event by a year. It has been decided to conduct the event from 1st October 2021 to 31 March 2022, following a vote from Bureau International des Expositions (BIE) Member States.
According to His Highness Sheikh Ahmed bin Saeed Al Maktoum, Chairman of Dubai Airports, President of the Dubai Civil Aviation Authority, Chairman and CEO of Emirates Group, and Chairman of the Expo 2020 Dubai Higher Committee, said: “We welcome the decision of BIE Member States to support the delay Expo 2020 Dubai by one year. We are thankful to Member States for their continued commitment to contributing to a World Expo in Dubai that will play a pivotal role in shaping our post-pandemic world at a time when it will be most needed.”
“Organising an international and successful event would require stability, freedom of movement and safety which unfortunately the world is currently missing due to the outbreak of the new coronavirus,” said Beatrix Karl, Commissioner General of the Austria Pavilion.
“We look at the decision of postponing Expo 2020 Dubai for one year as the collaborative and supportive response that shows global solidarity amid the uncertainty and risks everyone is facing nowadays.”
The member states voted remotely on the BIE Executive Committee’s recommendation for a delay as proposed by the UAE Government at the beginning of April and recommended by the BIE Executive Committee on April 21. Dimitri S. Kerkentzes, Secretary General of the BIE, said: “I applaud the swift response by BIE Member States. Their support for the postponement of Expo 2020 Dubai – which will be formally approved on 29 May – is a renewed sign of solidarity, and demonstrates the shared will to work together in ‘creating the future’.
The first World Expo to be held in the Middle East, Africa and South Asia (MEASA) region, and largest ever event to take place in the Arab world, the Expo, will bring together the best of trade, innovation and products from across the globe. It explores the theme ‘Connecting Minds, Creating the Future’.
Would you like to rate us on Google?
Related content
Get in touch
Whatever your question our team will point you in the right direction
Start the conversation