The fundamental instrument by which all the emirates regulate business activity is the requirement that any place of business must acquire and maintain a proper license. The procedures for obtaining a license vary from emirate to emirate, but are straightforward and publicly available. A license is not required unless a place of business is set up in the UAE. In other words, foreign businesses exporting to the UAE but without a regular or continuing business presence in the UAE do not need a license, service license, professional license and construction license. Several Federal regulation govern business activities in the UAE outside free trade zones. Activities within the free zones are governed by special bylaws.
Protection of Property Rights:
The UAE government continues to lead the region in protecting intellectual property rights (IPR). Anecdotal and statistical evidence confirms that the UAE government in enforcing copyright, trademark, and patent laws passed in 2002 to protect intellectual property, and continues to demonstrate its commitment to the 2002 agreement providing TRIPS.
The copyright law, enacted in July 2002, grants protections to authors of creative works and expands the categories of protected works to include computer programs, software, database, and other digital works. Efforts to combat computer software piracy in the UAE have been successful.
The UAE 'S Trademark
Foreign oil companies with equity in concessions pay taxes and royalties on their proceeds. There are no consumption taxes.
These laws, specially the federal companies law, are being revised to attract businesses and FDI to the country.
The Federal Companies Law: applies to all commercial companies established in the UAE and to branch offices of foreign companies operating in the UAE. Companies established in the UAE are required to have minimum of 51 percent UAE national ownership (which has been revised to allow more % for non-locals and to reach 100% in some business activities). However, profits may be apportioned differently. Branch offices of foreign companies are required to have a national agent (sponsor) unless the foreign company has established its office pursuant to an agreement with the Federal or an emirate's government. All general partnership interests must be owned by UAE nationals. Foreign shareholders may hold up to a 49 percent interest in limited liability companies.
The Commercial Agencies Law: requires that foreign principals distribute their products in the UAE exclusive commercial agents that are either UAE nationals or companies wholly owned by UAE nationals. (Now, this has also been revised.) The foreign principal can appoint one agent for the entire UAE or for a particular emirates or group of emirates. The law provides that an agent may be terminated only by mutual agreement of the foreign principal and the local agent, notwithstanding the expiration of the term of the agency agreement.
The Federal Industry Law: stipulates that industrial projects must have 51 percent UAE national ownership. The law also requires that projects either be managed by a UAE national or have a board of directors with a majority of UAE nationals. Exemptions from the law are provided for projects related to extracting and refining of oil, natural gas, and other raw materials. Additionally, projects with a small capital investment or special projects governed by special laws or agreements are exempt from the Industry Law.
The Tender Law: stipulates that a supplier or contractor, with respect to Federal projects, must either be a UAE national or a company in which UAE nationals own at least 51 percent of the share capital or foreign entities represented by a UAE distributor or agent. Foreign companies wishing to bid for a Federal project must, therefore, enter into a joint venture or agency arrangement with a UAE national or company. Federal tenders must be accompanied by a bid bond in the bid. UAE government entities often tender internationally.