As the year comes into an end, let’s review the new UAE laws launched this 2023. No doubt, the UAE government announce new rules yearly to position the nation for progress. So, whether you are a resident or an entrepreneur with a business setup in the country, these new rules in the UAE are always interesting and beneficial to know.
As a premier corporate service provider immersed in UAE law, NH Management helps clients navigate local regulations. Now, here are the top 10 UAE law updates implemented nationwide this year.
The UAE mainland courts added English as one of its official languages. This is based on the Federal Decree-Law No. 42 of 2022 also known as “The New Civil Procedures Law’ that came into effect on January 2, 2023.
No doubt that using English as an official language for UAE mainland courts will be beneficial for many lawyers. However, this decision may pose some hurdles for UAE citizens in courts. Firstly, some UAE citizens may not be able to speak English well or possess the necessary proficiency.
In fact, there are few Emiratis who have social experience with non-Emiratis, except for entrepreneurs, government employees, and those educated abroad. Hence, a lack of better understanding of written material such as case files, articles, and reports, may delay the overall local judiciary process.
For sure the UAE court will extensively address the challenges that come along with this change to improve the legal process standards. Even so, English will be permitted in UAE mainland courts for trials, proceedings, and in the announcement of judgments.
For a long time, the UAE was hailed as a “tax haven” for entrepreneurs and businesses. Hence, introducing a corporate tax caught everyone’s attention during mid-2023. Last June, the UAE government imposed a standard 9% corporate tax on businesses meeting specific conditions.
Clearly, all UAE businesses that have business profits exceeding 375,000 AED will have to pay 9% corporate tax. On the other hand, companies gaining profits below this threshold will pay only a 0% rate in support of small businesses and startups. Of note, this law covers the financial year starting on or after June 2023.
On top of that, the Federal Tax Authority (FTA) in the UAE has released a clarification on how natural and judiciary non-residents may be subject to corporate tax under specific conditions.
Firstly, if a natural person has a Permanent Establishment in the UAE and a Turnover exceeding AED1,000,000 during a calendar year. The second is if they derive State-Sourced Income from the Emirates.
On the other hand, FTA clarified that Corporate Tax registration is not required for Non-Resident juridical persons who solely derive State-Sourced Income and do not have a Permanent Establishment or nexus in the Emirates.
The UAE’s Ministry of Human Resources and Emiratisation (MOHRE) issues work permits for the workforce in the country. Basically, a work permit is a primary requirement for employment.
Previously, the general mainland work permit — not free zone areas — lasted for only two years. The Federal National Council (FNC) confirms the extension of the two-year work permit to three years.
This move will help reduce the costs associated with getting work permits. However, the UAE’s Ministry of Human Resources and Emiratisation (MOHRE) have not rolled out a timeline for this.
Dubai’s Department of Economy and Tourism (DET) has officially launched the Dubai Unified License or DUL. The DUL is to be issued to both existing and newly registered businesses in Dubai. And, the rule applies to all Dubai-based companies in operation in the mainland or free zone.
Spearheaded by the Dubai Free Zones Council, this initiative aims to streamline Dubai’s business processes. The DUL enables the latest company records, including licence details and data, to be consistently maintained within the registry. As a result, with only a single QR code, the public can validate a company by viewing all the details in a publicly-accessible online portal.
Since its announcement in early 2023, DET has issued over 50,000 licences, with plans to issue more in the coming period, covering all registered companies in Dubai mainland and free zones.
The UAE seizes every opportunity to make government processes seamless by utilizing technology. Since August, the government has enabled the option to apply for and make changes to Emirates ID online.
Specifically, residents can make changes in their name, occupation, employer, and key-in passport details — even a change in nationality. Simply, log into UAE’s Federal Authority for Identity, Citizenship, Customs, and Port Security’s website and select ‘Update Personal Information’.
Following the revisions, the clients will be taken to the payment page to complete the process. The changes including the smart service fee, application processing and federal authority fees cost 200 AED. After the payment, applicants can visit a customer happiness centre or an approved typing centre to get their new Emirates ID.
The Department of Culture and Tourism in Abu Dhabi has implemented a change in fees in the tourism sector that came into effect on September 1, 2023. Following the decision is the aim to propel Abu Dhabi’s thriving hospitality industry.
The Abu Dhabi government has reduced the tourism fee from 6% to 4% and removed the 15 AED municipality fee per room night. Besides that, the government waived off 6% municipal fee and the 4% municipality fee applied to hotel restaurants.
However, the 4% municipality fee for the value of the invoice billed to the customer will remain effective. Through this new fee structure, Abu Dhabi aligns with Abu Dhabi Culture and Tourism’s goal to attract more than 24 million visitors by the end of 2023.
For those grounded by the travel ban, lifting the ban is now an easier process. The Dubai Public Prosecution office now makes it easier to lift travel bans manageable online. Now, banned individuals can opt to make payment and then following court approval enjoy an automatic lift of their travel restriction.
Lastly, you’ll receive a text message from Dubai Public Prosecution confirming receipt of payment. The new service is part of the government’s ‘Services 360’ policy, which aims to push smart solutions for life admin, fast-tracking processes, and taking pressure off brick-and-mortar service centres.
Undoubtedly, the UAE is one of the top locations for work opportunities. To better protect the workforce within the country, the UAE has introduced the Involuntary Loss of Employment (ILOE) scheme which came into force early this year.
The ILOE scheme is a social security system that will provide workers with up to three months of compensation if they lose their jobs. The compensation can reach up to 60% of the employee’s salary. Surely, this applies to employees in both private and public sectors.
Fines are applicable if UAE employees do not subscribe to insurance within the grace period and do not pay the prescribed insurance premiums for more than three months, they will pay a fine of 400 AED.
The UAE used to give overstaying tourists a 10-day grace period after the visa expiry date. However, this is no longer the case since last May. The Federal Authority for Identity, Citizenship, Customs and Port Security (ICP) and other travel agencies confirmed.
With the removal of the grace period, the government will fine visitors immediately after their 30 or 90-day tourist visa expires. So, visitors failing to renew or exit the country before the visa expiry date get a fine of 50 AED per day.
Aside from daily fees, offenders will have to pay 320 AED for relevant charges and exit permits. Also, a person overstaying for 10 days will have to pay an additional 500 AED on top of the 320 AED.
Couples outside of the Muslim faith can now marry using a non-Sharia legal process under the Federal Personal Status Law. Significantly, the new law allows non-Muslims to register wills at the same time as their marriage certificate, which will allow them to share property ownership.
In Abu Dhabi, non-Muslim couples have been able to tie the knot in the civil court since February 2022. However, it was just starting on February 1, 2023, since it became a UAE-wide law.
As per the new decree, either spouse will be able to ask the court to end the marriage. This means divorce is possible without proving a party is at fault or justifying the need to end the marriage. Moreover, couples may be granted divorce after one hearing without the need to go through counselling or other therapies required.
New UAE laws listed in this article may be bound to change. Hence, we encourage readers to always refer to the respective government department’s website or office to stay informed. Also, for any business-related inquiries about setting up a business in Dubai, feel free to book a meeting with us.