The UAE and Canada maintain a long-standing partnership that is built on shared values and opportunities. Canadian investors’ penchant for exploring opportunities in the Middle East can be discerned from the number of companies that have initiated business setup in the UAE. A report by Canada-UAE Business Council states that there are over 150 Canadian companies and 40,000 Canadian citizens in the UAE. Yet, business setup consultants in Dubai, UAE believe that Canadians have a lot of opportunities still to explore.
This is an attempt to celebrate the economic relationship between the two countries and a look at what the future has in store for Canadian investors in the UAE. We invite you to explore it further:
Why should Canadian Investors Do Business in the UAE?
The UAE provides foreign investors with a host of unique business opportunities that they cannot find in some of the major economies in the world. Some of the top features of company formation in the UAE are listed below:
A Strategic Location for Trade & Commerce
Since it is located at the centre of some of the world’s most important trading routes, the UAE enjoys a strategic advantage over many other investment destinations. The UAE serves as an important logistic hub between the East and the West. Canadian investors view the UAE as a vital door to enter the lucrative markets in the Middle East, Africa, and Asia. By commencing the process of business setup in the UAE, Canadian businesses get easy access to a market that is composed of more than 3.2 billion people.
A Highly Diversified Economy
The UAE has put immense efforts to diversify its economy away from oil dependency, and the endeavour further boosted the flow of foreign investments. The diversification started more than two decades ago, resulting in the country’s status as a global hub for business and tourism. The government ramped up the diversification efforts with strategies such as UAE’s 2021 Vision, Dubai’s Plan 2021, and Abu Dhabi’s Economic Vision 2030.
Excellent Connectivity & Robust Infrastructure
Investing in industrial business activities in the UAE is a lucrative prospect for Canadian entrepreneurs as the country boasts of exemplary connectivity and infrastructure facilities. Two-thirds of the world’s population is only eight hours away from the major airports in the UAE. The country has two world-renowned airlines: Emirates Dubai and Etihad Abu Dhabi.
The country is developing Al Maktoum International Airport, which will be the largest airport in the world once fully completed (expected in 2027). The airport’s projected annual capacity is 12 million tonnes of freight. The UAE also boasts of one of the world’s busiest seaports such as Jebel Ali, Mina Rashid, Mina Zayed, and Khor Fakkan. Canadian investors who wish to set up import/export businesses in the UAE can take advantage of these strategic infrastructure benefits.
No Big Burden of Taxation
Relatively low or nil taxation is a prime factor that makes the business setup in the UAE, appealing to foreigners in comparison with other major economies. At present, the UAE’s tax environment is free from personal taxes, capital gains taxes, withholding taxes and corporate taxes ( Oil & Gas companies are an exception). The companies in the UAE are subjected to Value Added Tax (VAT) which is only 5%. The low or nil taxation regime frees foreign investors from major financial and administrative burden.
Friendly Business Environment
The government has liberalised the economy to boost foreign investments and company formation in the UAE. The country ranks 16th in the ease of doing business ranking indexed by the World Bank as of 2020. Since the country’s expatriate population is composed of a diverse mix of nationalities, English is the most commonly used language for business communication. The Canadian businessmen, therefore, won’t find themselves alienated in the UAE.
Much to the relief of foreign investors, the UAE has set out some secular-leaning reforms in 2020 that were largely hailed by the international community. Decriminalising punishments for alcohol consumption and cohabitation by unmarried couples are prominent among the new progressive reforms. The new reforms that came in the Post COVID-19 era have rejuvenated the confidence of investors in the UAE. The UAE has a Minister for Happiness, and the country has retained its first place among the Arab countries for the sixth consecutive year, according to World Happiness Report 2020.
Flexible Business Structures to Choose
Canadian investors get a wide range of business structure options when it comes to company formation in the UAE. The businessmen get total control of ownership if they are setting up a company in the UAE free zones. There are more than 40 free zones in the UAE that also offer the benefits of total repatriation of profits, modern infrastructure, and office space solutions.
Also, the companies can establish a Limited Liability Company (LLC) in the UAE mainland that gives them the opportunity to trade anywhere in the country. Under the new FDI regulation, the UAE has now begun to allow 100% ownership for mainland companies operating in specific sectors such as Manufacture, Agriculture and Service Sectors. Apart from these options, investors can also opt for legal structures such as sole proprietorship, civil company, and freelancer permits as well. Consult with the best business setup consultants in Dubai, UAE, to choose the right legal structure.
How can Business Setup Consultants in Dubai Help?
Considering the historic relationship existing between the UAE and Canada, expanding into the Middle East markets is a smooth process for Canadian investors. Initiating the process of business setup in the UAE is profitable for Canadian businessmen due to factors such as strategic location, friendly business environment and a low taxation regime. The flexible business structure options are a major plus for the Canadians, but knowledge about the legal requirements is a must for quickly clearing the procedure of company formation in the UAE. Obtaining the license turns easier if the businessmen hire the best business setup consultants in Dubai, such as Jitendra Business Consultants (JBC). JBC has a team of qualified business setup consultants who simplify the process for the investors on the back of their strong knowledge of UAE labour laws, immigration laws.