Month: December 2022
Freezone company setup in JAFZA
HLB HAMT
Phone:- +971 4 327 7775
Mobile:- +971 55 160 1291
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
JAFZA, or the Jebel Ali Free Zone, is one of the Middle East’s largest and oldest business networks. JAFZA in Dubai became the first free zone in the world to receive an ISO certification in 1996. Jebel Ali Free Zone is the most sought-after Free Zone destination in Dubai with its long history and top-notch infrastructure.
AED 2.5 billion Jebel Ali free zone conference centre complex is the ideal location for JAFZA enterprises to connect in an economically and productively efficient space. Along with these amenities, JAFZA also boasts business towers, luxurious hotels, and a convention centre geared toward serving the business sector. You can count on HLB HAMT consultants for Jebel Ali Free zone Company Setup in Dubai.
One of JAFZA’s key selling points is its location. Its port is the most developed in the region and has one of its most advanced warehouse facilities. Due to its quick access to shipments from Asia, Africa, the Russian Commonwealth (CIS), and other places, Jebel Ali is a popular choice for multinational corporations.
Why Choose JAFZA To Establish A Free Zone Company?
License Types Available for JAFZA Company Registration
Trading License
This is the most common type of license in JAFZA. It provides the most freedom and flexibility for running a business.
Industrial License
The holder of this license is permitted to import raw materials, produce the products listed, and export the finished goods to any nation.
Logistic License
Allows businesses to carry out a variety of particular logistic services. This licence is a popular option for businesses to conduct business because of its close vicinity to the port of Jebel Ali.
E-commerce License
Enables a company to register a company under the chosen formation type with the principal means of conducting business utilising exclusively digital media. With this permission, the company will be able to sell its goods through non-physical channels. This implies that conducting business or selling goods through a physical storefront is not allowed.
Service License
The bearer of this license is permitted to perform the services listed therein within the Free Zone. The type of service must be compliant with the parent company’s license, which was granted by the Economic Department or Municipality of the relevant Emirate in the United Arab Emirates.
Industrial National Licensing
Manufacturing businesses with a minimum of 51% ownership or shareholding by nationals or residents of the AGCC (Arabian Gulf Co-operation Council) are eligible for this license. The item’s worth in the Free Zone must increase by at least 40%. With this business license, the owner can get the same benefits as a local or AGCC in the UAE.
Documents Required to Register Company in JAFZA
The documentation for forming a company in JAFZA can vary depending on the company type that the investor or business owner chooses. Each company is required to provide the following paperwork:
- An application for setting up a company in JAFZA.
- An application form for environmental health and safety.
- Passport copies for shareholders, management, and the secretary
- A description of the company’s operations.
- Articles of association of the company
- Individual stockholders must provide further documentation
- Each shareholder’s business profile
- Manager signature sample
- For branches of international companies and non-individual shareholders, additional documentation is needed
- Memorandum (MOA) and articles of association that have been attested and notarized (AOA).
- Attested signature specimen by JAFZA.
- Registration Certificate.
- Board resolution to form the company
- A formal letter from the parent company to set up a branch office in JAFZA (in case of a branch).
- A copy of the Chamber of Commerce certification (in case of a branch).
How to start a business with JAFZA?
Upon successful submission of your documentation, you will receive initial approval for your business. Then, from JAFZA, you will choose a pre-built office that meets your business needs. A JAFZA-approved contractor can provide proper office fit-out services or you can work independently. You can pick up the keys to your office once the office is ready and a leasing agreement is prepared. Your business license will be issued once official documentation is prepared and submitted to the appropriate authorities.
Establishing your business with HLB HAMT Consultants
When forming a firm in a new place, the business owner must be familiar with all of the best options in the area. It is essential to have a hassle-free system in place to launch your business in this era of entrepreneurship and the start-up business ecosystem. An entrepreneur or a well-established company enterprise will find that Jebel Ali Free Zone meets all of their requirements for a free zone. JAFZA is among the greatest locations to start your firm because of its superior infrastructure, Speedy system, proximity to nearby ports, and prime location.
For JAFZA Company Registration, HLB HAMT offers comprehensive services. We rank among the top business consulting firms in the UAE. We provide a full range of services for setting up a free zone, including the preparation of the necessary paperwork, submitting it to the appropriate authorities on your behalf, helping you open a bank account, get a visa, locate a local service agent if needed, and even drafting legal documents in either Arabic or English. For investors interested in forming a JAFZA company, we offer the ideal business model as part of our expertise in business creation in Dubai.
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Things to Know About Employment Contracts in the UAE
HLB UAE Payroll Team
Phone:- +971 4 327 7775
Mobile:- +971 50 205 9540
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
An employment Contract is an agreement between an employer and an employee that contains fundamental working terms such as the employee’s designation, the commencement date of employment, remuneration, and the contract’s duration. The employment contract should be drafted in two versions, one for the employer and one for the employee, and both should be signed.
A worker may be hired under a fixed-term employment contract for up to three years under Federal Decree-Law No. 33 of 2021 on the Regulation of Labour Relations in the Private Sector. The term could be extended or renewed for a shorter time frame. Labour Contract in UAE ensures a flexible working environment.
Three-year Fixed-term contracts
All workers must sign fixed-term employment agreements that last up to three years. Upon expiration of the term, the employment contract can be renewed or extended (multiple times).
When the contract is not renewed or extended, but the parties continue to operate as if the contract is still in effect, then the contract is deemed renewed under the most recent terms and conditions. Every extension or renewal will automatically count toward an employee’s total years on the job for end-of-service gratuity).
Types of Work Arrangements
In addition to full-time employment, the new Labour Contract UAE also introduces the following working models:
Part-time
Working a certain number of hours or days for one or more employers on a part-time basis.
Temporary work
Tasks must be completed within a set time frame.
Flexible work
Conducting some or all of your work remotely.
More importantly, the new Law’s adoption has given employers more ways to meet their hiring needs. Moreover, it will provide flexibility to workers who prefer non-traditional working arrangements.
Contract Termination
Even though the term “fixed” is used, the new legislation stipulates that fixed-term contracts may be terminated on notice at any time during the term for a “legitimate reason,” under the employment contract is given (minimum of 30 days, maximum 90 days).
Employers and employees are required to pay equal compensation if they do not serve the notice period, or if they choose not to serve it. Upon termination of employment, an employee is entitled to one day of unpaid leave per week to look for a new job.
- It is now acceptable to terminate an employee with notice for reasons other than those relating to performance or behaviour: The concept of redundancy is now expressly recognized as a legitimate reason for termination if the employer is bankrupt or insolvent, or if there are any economic or exceptional reasons. In addition, it is permissible to terminate an employee’s employment if the business closes or when their work permit expires.
- There have been some notable additions to the existing legislation that mirror the grounds for immediate dismissal: Abusing one’s position for personal or financial gain, or working for another employer without adhering to the company’s policies.
- A new set of grounds has been added for an employee to leave immediately and without notice: *In cases where a danger exists at work that threatens an employee’s health or safety, provided the employer knows about the risk and does not take action to eliminate it.*Work assigned to an employee that is not in line with their job description (without their consent).
Non-Compete Restrictions
Employers are allowed to impose non-compete clauses in employment contracts under Article 10 of the UAE Labour Law. These limitations must be defined in terms of time, place, and the nature of the work to protect the business’s legitimate interests. Upon expiration of an employment contract, the maximum restrictive period is two years.
Reviewing contracts, employee handbooks, and any other employment policies and procedures is crucial for all UAE businesses (both onshore and in the free zones) to ensure compliance with the New Law. We are proud and happy as we work together to ensure your compliance.
How HLB HAMT service work different from others
The core of the business at HLB HAMT is technology, and the company strives to pursue and provide high-quality audit and advisory services. Contact HLB HAMT consultancy for a thorough consultation on the employment laws in the UAE. We are happy to answer all your questions about resident visas, labor laws, and probation period rules in UAE.
HLB HAMT will continue to monitor the requirements of the upcoming legislation to keep our community updated on any new developments or recommendations.
HLB HAMT can help you and your company create policies, procedures, a risk-based obligation register, and training to make sure that the new Law’s requirements are met.
Trust HLB HAMT, one of the top payroll outsourcing companies in the UAE, to expedite and accurately complete your payroll. We have a distinguished history of outsourcing the best payroll method from the UAE to other nations.
Frequently Asked Questions
What is the new UAE Employment Contract Law?
The new UAE labor law prohibits unlimited contracts. Instead, an employment contract is only considered valid if it is less than three years old. It is possible to extend or renew a contract after it expires.
What is the purpose behind the new employment contract law?
The new Law’s adoption has given employers more ways to meet their hiring needs. Moreover, it will provide flexibility to workers who prefer non-traditional working arrangements.
What are the working models introduced by the new law?
In addition to full-time employment, the new Labour Contract UAE also introduces Part-time, Temporary, and Flexible working models.
What are Non-compete restrictions in employment contracts?
A non-competition restriction (or non-compete clause) restricts an employee from joining another organization for a defined period after termination.
Will there be a termination in fixed-term contracts?
The new legislation specifies that fixed-term contracts may be terminated with notice for a “legitimate reason (minimum of 30 days, maximum 90 days).
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Monthly Tax insights and updates – November 2022
December 8, 2022
Phone:- +971 4 327 7775
Mobile:- +971 50 677 5860
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
The November edition of HLB HAMT’s Monthly Tax Insights is jam-packed with updated information about tax-related matters in the UAE and the GCC region.
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IFRS 16 Accounting for Leases
December 7, 2022
Phone:- +971 4 327 7775
Mobile:- +971 50 749 0576
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
In this short video, our Audit & Assurance partner Nithin N. K. will provide some insights on IFRS 16 (accounting for leases), which includes details on lease modification, the distinction between lease reassessment and modification, and much more.
After watching the video, please share your feedback and subscribe to our channel for regular updates.
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The “EMARA TAX” has been launched by the UAE’s Federal Tax Authority
HLB HAMT News Team
Phone:- +971 4 327 7775
Mobile:- +971 50 677 5860
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
On 05 December 2022, the Federal Tax Authority (FTA) launched EmaraTax, an unified communication and entirely created digital platform for managing taxes in UAE. The switch from the old system to the new infrastructure was smooth, and all current users’ information was successfully transferred to EmaraTax, allowing them to comfortably utilise the advanced interactive platform without having any impact on any of the authority’s customers operations.
FTA Director-General Khalid Ali Al Bustani said, “The launch of EmaraTax is a significant step forward and also a milestone in the FTA’s ambitious plans to become a leading digital authority in the tax sector, marking a notable leap forward towards advancing the UAE’s tax system.”
Let’s examine some of the main characteristics of the Emara Tax.
Increased compliance is assured
Emara Tax will give a comprehensive overview, guarantee smooth interaction with all stakeholders, optimize administrative services, connect to numerous key taxpayer services, and lead to more effective processes and a higher taxpayer experience. As a result, FTA will be able to increase compliance and reduce risks.
Submitting a VAT return
The ability to obtain an excel version of the VAT return and submit it to the website using the new functionality reduces the possibility of network issues while manually entering the data online.
Access and track your whole activity history
The new portal enables you to follow the status of all your filed applications to the FTA and allows you to examine all of your correspondence with the FTA in one location.
Deregistration Process Streamlined
De-registration will be automatically granted upon filing of the last VAT return with the FTA-approved deregistration commencement, providing there is no outstanding taxpayer due.
Additional security measures
Taxpayers may now log in to the new Emaratax platform using their registered email address or an Emirates ID that is connected to a UAE pass. Additionally, it permits two-factor verification when logging into the account.
Reactivation of TRN
It is now possible for the individual who deregistered when their taxable supplies fell below the obligatory or voluntary level to reactivate their TRN through the action menu.
Bottom Line
EmaraTax would improve the UAE’s capacity to manage taxes by facilitating better, quicker choices and early engagement with taxpayers. EmaraTax collaborates with significant national technology-based initiatives like UAE PASS and prominent government bodies like the UAE Central Bank as part of its attempts to simplify the user engagement. Additionally, this fits in with the UAE’s national digital strategy, which aims to take advantage of emerging technology and create a strong digital infrastructure for both individuals and companies.
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The Top Cybersecurity Predictions for 2022
Vimal Ramachandran
Phone:- +971 4 327 7775
Mobile:- +971 52 830 7998
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
The priorities of security and risk leaders are determined by a focus on privacy laws, ransomware attacks, cyber-physical systems, and board-level scrutiny.
Cyber-physical systems are combining the physical and cyber worlds for technologies such as autonomous cars and digital twins, creating yet another security risk for organizations. One of our top predictions for the next few years is how threat actors will attack these systems.
Organizational security and risk management have evolved into a board-level concern. The number and sophistication of security breaches are increasing, which is prompting increased legislation to protect consumers and put security at the forefront of business decisions.
Gartner analysts anticipate increased decentralization, regulation, and safety implications in the coming years.
- Modern privacy laws will cover the personal information of 75% of the world’s population by the end of 2023.
The GDPR was the first significant consumer privacy legislation, followed quickly by others, such as Brazil’s General Personal Data Protection Law (LGPD) and the California Consumer Privacy Act (CCPA). Because of the breadth of these laws, you’ll likely be managing multiple data protection laws in different jurisdictions, and customers will want to know what kind of data you’re collecting and how it’s processed. It also implies that you should concentrate on automating your privacy management system. Standardize security operations by starting with GDPR and then adjusting for individual jurisdictions. - Organizations implementing a cybersecurity mesh architecture will reduce the financial impact of security incidents by 90% by 2024.
Organizations now support a wide range of technologies in various locations, necessitating the application of a versatile security solution. The cybersecurity mesh extends beyond the traditional security perimeter to cover identities and create a holistic view of the organization. It also contributes to increased security for remote work. In the next two years, adoption will be influenced by these demands. - By 2024, 30% of enterprises will use the same vendor for cloud-delivered Secure Web Gateway (SWG), Cloud Access Security Brokers (CASB), Zero Trust Network Access (ZTNA), and Firewall as A Service (FWaaS).
Organizations are increasingly focusing on optimization and consolidation. Security leaders frequently manage dozens of tools but intend to reduce this number to less than ten. SaaS will become the preferred delivery method, and consolidation will affect hardware adoption timelines. - By 2025, 60% of organizations will consider cybersecurity risk when conducting third-party transactions and business engagements.
Investors, particularly venture capitalists, consider cybersecurity risk when evaluating opportunities. Organizations are increasingly considering cybersecurity risks during business transactions such as mergers, acquisitions, and vendor contracts. As a result, there are more requests for information about a partner’s cybersecurity program, such as questionnaires or security ratings. - The proportion of nation-states enacting legislation to regulate ransomware payments, fines, and negotiations will increase to 30% by the end of 2025, up from less than 1% in 2021.
While broader regulations may apply to ransomware payments for the time being, security experts anticipate a more aggressive crackdown on payments. Given the largely unregulated cryptocurrency market, paying ransoms has ethical, legal, and moral implications, and it’s critical to consider the consequences. The decision to pay (or not to pay) should be decided by a multi-functional team that can address all of these concerns. - By 2025, 40% of corporate boards will have a dedicated cybersecurity committee chaired by a qualified board member.
Expect a board-level cybersecurity committee along with stricter oversight and scrutiny as cybersecurity becomes (and remains) a top priority for boards. The result raises the visibility of cybersecurity risk throughout the organization and necessitates a new approach to board reporting, the specifics of which may vary depending on the board members’ backgrounds and experiences. Concentrate your messaging on value, risk, and cost. - By 2025, 70% of CEOs will mandate an organizational resilience culture to withstand converging threats such as cybercrime, severe weather events, civil unrest, and political instabilities.
To account for broader security environments, go beyond cybersecurity and into organizational resilience. The threat landscape becomes more complex because of digital transformation, which affects how you produce products and services. Work on defining organizational resilience and objectives, including compiling a list of cyber risks that affect them. - By 2025, threat actors will have successfully weaponized operational technology environments, resulting in human casualties.
As malware spreads from IT to OT, the discussion shifts from business disruption to physical harm, with liability most likely resting with the CEO. Focus on asset-centric cyber-physical systems and ensure the right management teams are in place.
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Internal Audit and Emerging Technology: The future of IT Audit
Midhun Menon P
Phone:- +971 4 327 7775
Mobile:- +971 52 830 7998
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
Technology is both a blessing and a curse. During COVID lockdowns, many office workers have begun to work remotely, and businesses of all sizes have begun to market their products online. Virtual meetings became commonplace. Everyone learned to live and work in a more remote world.
While some people find the opportunities that technology creates endlessly exciting, others (often those in charge of monitoring, controlling, and ensuring that it is used safely, ethically, and by regulations) find it incomprehensible and threatening. Many internal audit teams have been struggling for several years to find people with IT audit expertise, and they are now under increasing pressure to use more technology, more effectively, in their audits. The rapid emergence of new technological developments, from AI to blockchain, adds to their concerns.
However, the complexity of auditing emerging technology in a new digital age should not be underestimated. Internal audit processes and methodologies that have been tried and tested are not obsolete. Internal auditors must comprehend what existing and emerging technologies do in their organizations, as well as what they will do in the future. They must also be aware of potential risks and gaps in assurance.
They can, however, accomplish much of this without specialized IT skills; as with all internal audit engagements, curiosity, imagination, and the ability to ask the right questions of the right people are essential. External assistance can be obtained for specialized areas, but all internal audit teams are likely to interact with emerging technology in some form and should take the time now to consider what this means for their business and audits.
Technologies in Development
Most internal audit teams are becoming acquainted with auditing technology that allows for remote work and well-established corporate IT systems, and many are beginning to use data analytics and Big Data to inform their audits. However, it is now critical to keep an eye on emerging technologies, which are still relatively uncommon but are expected to develop rapidly. Internal audits must stay one step ahead of any risks or assurance gaps that arise because of these risks.
A recent survey of attendees at a Wolters Kluwer webinar on emerging technology found that 20% were using robotic process automation (RPA), 12% were using artificial intelligence (AI), and 3% were using blockchain technology. Significantly, half of the attendees said their organizations were not yet using any of these, while 15% said they were using more than one. Given how quickly technology advances, internal audit must understand what this means for their business, but most still have time to prepare.
Other examples range from virtual reality, the internet of things, bioinformatics, and natural language processing to quantum computing and 5G. RPA, AI, and blockchain are the most widely used and well-established, so these are the ones that internal auditors are most likely to have to audit shortly.
Internal auditors may be called upon to evaluate the strategic decision-making process when a company adopts new technology, but their work will be similar to that of other large corporate decisions. The main audit challenges are assessing any new risks that an emerging technology introduces into the organization once it is implemented, as well as how management monitors and controls these risks. As a result, the internal audit team must understand what the technologies will be used for, how they will be used, and by whom.
Risks associated with RPA
Risks associated with RPA, which is used to automate frequently repeated processes that are critical for day-to-day business, include inappropriate process selection, incorrect configuration, unexpected costs, security, inadequate performance, and change management.
One application of RPA could be a chatbot designed to filter common customer questions. Incorrect configuration may cause the bot to delay passing customers who require additional assistance from human contact, alienating customers. Inappropriate processes may imply that a bot is used to answer questions that may indicate fraud or involve sensitive information that requires individual thought and attention.
Similarly, an RPA system may incur unanticipated costs if, for example, a bot replaces call center staff but then necessitates specialized maintenance and more skilled and expensive personnel to manage it. Other internal audit considerations include whether a bot handles sensitive data that is subject to privacy or other regulations and whether it regularly connects to organizations outside the corporate firewall, introducing new risks of breaches or misused data.
The sheer volume of data passing through an RPA system may necessitate the addition of new safeguards and checks. On the other end of the spectrum, it’s critical to monitor whether the system is functioning properly—that is, whether it can connect to all of the internal systems that it requires to provide meaningful, accurate answers to questions. The internal audit could also look at whether the IT team has enough experience, training, and resources to manage it.
The administration of an RPA system may also pose a risk. If it is used to automate an area where frequent changes are made, it may necessitate additional layers of processes each time, adding time, complexity, and the risk that people will cut corners.
AI’s most common risks
AI introduces a new set of risks. Data system use numerous resources and as a result, more entry points and connections are formed, thus enhancing the potential risks. Physical risks may also exist if an organization uses AI in products such as autonomous vehicles or to detect when heavy machinery requires maintenance. AI could also be used to diagnose medical problems. If it is improperly configured or malfunctions, it may cause harm to people before the problem is identified.
Some risks overlap with those associated with other types of emerging technology; for example, data privacy is likely to be important when employing AI. Internal auditing should ensure that data used and shared have the explicit consent of data providers. Is this configured correctly and adequately controlled?
There have also been reports of AI systems being primed with data, which results in inherent bias. If a system is designed using data collected over a long period and is configured to make decisions based on prior rationale, it is likely to make similar decisions, which may reflect observed human biases from that period. This increases the likelihood that a company will not only shortlist the wrong candidates but will also suffer reputational damage and possible legal costs. Internal auditing should look into how this is being tracked and whether bias is being identified, managed, and corrected.
Internal audits should also inquire about how the AI system can be modified if external circumstances drastically change. AI is designed to evolve and adapt, but only within the parameters that it is given. If the world changes quickly, as it did when the pandemic began, new parameters may be required.
Both intentional and unintentional failures must be considered. The more powerful and connected a system is, the more destructive it can be if misused, putting trade secrets, plant operations, and security at risk.
Common risks for Blockchain Technology
Blockchain’s strengths can also be its weaknesses. The inability to reverse transactions or access data without the necessary keys makes the system secure, but it also means that organizations must follow specific protocols and management processes to avoid being locked out and to have clear contingency plans.
Interoperability is essential for blockchain; it must be able to communicate with multiple internal and external systems. Internal audit must gain assurance that it can do so and that it is thus functioning properly. Because operating through network nodes exposes the organization to cyber-attacks and data hacks, security concerns are paramount.
Internal auditors should also ensure that the organization has the necessary data management processes in place and is in compliance with all applicable regulations. Because the regulatory landscape for blockchain is still evolving, audit teams should ensure that compliance managers are constantly monitoring developments and adapting processes accordingly.
Further risks stem from the organization’s transactions with unknown external organizations; auditors should inquire whether this could expose them to, for example, violations of anti-money-laundering legislation.
Programs for scoping out Emerging Technologies
All emerging technologies rely on interactions with internal and external systems. With each new connection, new risks are introduced. This is an evolution of the risks that internal audit considers when auditing existing IT systems, but the volume of data and system complexity are novel.
Furthermore, internal auditors should be aware of the critical importance of adequate security and backup procedures for encryption and keys.
Some emerging technology is governed by existing regulations, such as those governing privacy, but much remains unregulated or only lightly regulated. Internal auditors should expect regulations to change quickly.
Finally, rather than being distracted by their focus on emerging technology, internal audits should continue to monitor the overall health of their organization’s IT as usual. It is critical to find ways to blend how old and new IT risks are constantly monitored.
When asked what the most important factor was to consider when planning and scoping an audit of emerging technology, 62 percent of Teammate webinar attendees said it was aware of the risks introduced by technology. Their next most important concern was the alignment of new technology with enterprise strategy (23%), while 10% were concerned about a lack of subject matter experts.
Three-quarters of webinar participants said they currently outsource or co-source support for emerging technology audits. According to Jae Yeon Oh, one of the advantages of co-sourcing is that the audit team can learn from working alongside those with more experience. Only 11% of attendees had auditors with experience auditing emerging technology, and 23% admitted they did not audit it at all.
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