The United Arab Emirates (UAE) represents a lucrative market for European exporters looking to expand. Offering exciting opportunities across multiple sectors. With an easily accessible location, great infrastructure, and business-friendly environment, the UAE has emerged as a global trade hub in the last 15 years.
However, as with any market, it’s one that demands an understanding of the legal and regulatory environment.
This guide will explain the essential legal and tax considerations European logistics professionals must address when exporting to the UAE.
Many items are either prohibited from entering the UAE market entirely or require a licence to do so. There could also be UK or EU licence requirements to export the goods from origin. Some of the items that are banned entirely from the UAE market are listed here.
Ensure you have all the valid licences in place before exporting to the UAE.
If your exports likely involve a partnership with an agency or distributor, this relationship is governed by Federal Law No. 3 of 2022, Regulating Commercial Agencies.
That law can provide reassurance in the legitimacy of any partner. It also outlines their and your legal obligations. It's advisable to draft agreements outlining terms, obligations, and termination clauses to avoid potential disputes.
Obviously, a key part of the compliance process is ensuring you have the correct commercial documentation for goods to pass through customs successfully.
A list of the most common documents shares similarities with most export markets and are as follows (please note, this is not an exhaustive list):
Working with a reliable customs broker familiar with the latest regulations is highly recommended.
Added is the list of potential regulatory certificates your goods may require. Again, this includes but is not limited to:
The UAE is a signatory to several international IP treaties and has established laws covering trademarks, patents, and copyrights.
Registering IP rights with the relevant UAE authorities ensures legal protection against infringement. You can submit an online application to protect intellectual works here.
Historically, if you operate an entity within the UAE, you were required to have 51% ownership from a local Emirati partner. However, recent law changes now permit 100% foreign ownership. Ensure you consult the latest legal information to understand acceptable ownership structures.
There are also more than 40 free-trade zones within the UAE. These offer sizable benefits to foreign companies, including 100% repatriation of profits and exemptions from customs duty.
The UAE has strict labelling requirements for imported goods. Labels must be in Arabic, the country's official language. They must also include specific information like product name, ingredients, manufacturing date, and expiry date.
Additional regulatory approvals may be required for specific product categories like food and beverages, pharmaceuticals, and electronics.
“When it comes to exports you have to be prepared… that’s why we make sure we appoint the right partners, that know their own regulations and are able to guide us. Of course, I make sure I am aware as well, so I don’t rely on our distributors 100%. So it is a proper, proper relationship, so we know what is required for that market.”
Adriana Santos, Head of International, Tracklements
Imported goods must also comply with the UAE's technical regulations and standards, which can sometimes differ from European standards. Working with a product certification body can help ensure your products meet all essential safety and quality requirements.
The UAE generally applies a standard customs duty rate of 5% on the value of goods plus Cost Freight Insurance. However, certain products like tobacco and alcohol attract much higher rates. Conversely, some products are exempt from duty. See a full list of the duty rates applied to imported goods into the UAE here.
Free trade zones offer some duty exemptions at the point of import. However, duty will be due once the goods are sold to the market.
The UAE imposes a standard VAT rate of 5% on most goods and services. If you are exporting from Europe, your customer or distributor will likely handle this.
However, if you have premises in the UAE, understanding VAT registration requirements and record-keeping obligations is essential. Registering for and paying VAT is mandatory if your business value exceeds AED 375,000 (£80,000). You can register online here.
Again, this is only applicable for businesses with premises in the UAE. But once profits exceed AED 375,000 (£80,000), a corporation tax rate of 9% is applied.
Successful exportation to the UAE demands expertise but can unlock huge rewards. It requires a detailed understanding of regulatory and tax considerations.
European businesses that are thorough with their compliance planning and use the right partners will find the UAE market not only accessible, but truly transformative to business goals. At WTA, we have an office in the UAE, to provide support for businesses looking to export to the region. Reach out today and let our experts guide your Middle Eastern success story.
Disclaimer: This guidance represents general advice and should not substitute professional legal or tax consultation.