Why Setting Up a Business in the UAE should be a Top Priority for Spanish Investors?
The bilateral relationship between Spain and the UAE is based on solid economic and trade ties. The current climate of business setup in the UAE evinces ample scope for Spanish investments. The ratification of the new FDI Law is an indicator for fresh investments into the UAE as foreign investors would be able to have 100% ownership in their mainland companies. This is a phenomenal time for company formation in the UAE, and here is a list of reasons explaining why Spanish businessmen should take the plunge.
UAE is a Strong Base for Spanish Firms
More than 200 companies have set up businesses in the UAE in a diverse range of industries. Spanish investments into the UAE had reached AED3.3 billion in 2018. The massive jump in investment made Spain the fourth largest investor in the UAE in terms of FDI capital inflows. Spanish investments are mainly concentrated on key sectors including commercial building construction, accommodation and food services, arts, entertainment and recreation, management of companies and enterprises, and retail and wholesale trade. The two countries are also linked by a good number of daily flights which has boosted the prospects of company formation in the UAE for Spanish entrepreneurs.
Diversity in Business Setup Options
Setting up a business in the UAE comes with the benefit of a wide range of company incorporation options for foreign investors. Over 40 free zones that offer total ownership, complete repatriation of capital and tax benefits simplify the process of company formation in the UAE. The investors can also set up companies in the UAE mainland that provides immense market access benefits. The government has now scrapped the previous mandatory requirement of granting 51% ownership to a UAE national (local sponsorship). However, this applies to specific business activities in sectors such as manufacturing, agriculture and services sectors. This is a great opportunity for Spanish businesses to expand their presence into the UAE.
Robust Treaties to Avoid Double Taxation
The UAE and the Spanish government signed the Double Tax Avoidance (DTA) treaty in 2006. The provisions of the DTA encompass company incorporation in the UAE as well as its management. For individuals, the DTA provisions cover citizenship and permanent residence in the UAE. DTA allows foreign investors to avoid the situation of being taxed in two countries on the same tax base. Double taxation negatively impacts the cross border exchange of goods, services and capital and technology transfer and trade. However, DTA effectively eliminates the harmful effects of double taxation, thereby enables Spain and the UAE to achieve their intended trade goals.
UAE Tops in Digital Transparency
In the post-Covid-19 era, an open data policy and fast adoption of digital transformation are considered as pivotal to business success. The UAE, in this regard, has achieved more significant strides compared to many other progressive countries. The UAE is ranked 16th globally (out of 187 countries) in the latest Open Data Inventory (Odin), Report 2020. The ranking is a recognition for the UAE’s openness of official statistics to identify gaps, promote open data policies, improve access, and encourage communication between national statistical offices (NSOs) and data users. It is a stellar achievement because the UAE has outperformed countries including Spain, UK, France, Switzerland, Japan, the UK and the US. By opening companies in the UAE, Spanish investors can benefit from the country’s accomplishments in digital transparency and innovation.
Attracting Top Talents is Now Easier
Expatriate professionals constitute the lion’s share of the workforce in the UAE. The attractive perks such as high living standards are the key factors that lure efficient professionals into the country. Yet, many businessmen think the UAE’s reliance on Islamic Personal Laws are a turn off for the European professionals and investors. However, the UAE recently introduced many progressive reforms permitting unmarried couples to cohabit, scrapping the requirement for residents to obtain an alcohol licence to purchase liquor from retail stores etc. Businessmen have welcomed this move and expect it to improve investor confidence and help in attracting top talents in sectors such as real estate, energy and infrastructure. The hiring of top talents in those sectors was deemed to be a tough job previously.
Consult with Top Business Setup Consultants in Dubai, UAE
Moving into the UAE to expand business presence is one of the most profitable options for European nations like Spain. The long-standing trade relations between the two countries is positive for Spanish investors when it comes to company formation in the UAE. Most investors must be unaware of the legal compliance requirements while initiating the process of business setup in the UAE. This gap, however, can be easily fixed by seeking assistance from expert business setup consultants in Dubai, such as Jitendra Business Consultants (JBC). JBC’s highly qualified company formation specialists provide guidance for the free zone, mainland and offshore company incorporation in the UAE. JBC’s company setup advisers handle the documentation, visa processing, bank account opening and approval from government departments on behalf of the investors. JBC’s bespoke assistance let the investors devote their precious time on their core competencies and achieve their business goals without any hassle.