In June 2018, the UAE Government announced a New Visa Rule in UAE to be effective from October 21, 2018. According to the new rule, certain key professionals will be granted long-term residency visas. These include investors, executives, entrepreneurs, as well as specialists working in medicine, research or science. The group of these key professionals can get permission to stay in the country for up to 10 years. Also, all mainland companies will now be able to have a 100 percent foreign ownership. The UAE government want to ensure that the key professionals stay for longer in order to make the UAE more competitive and shift its reliance on the oil and natural gas sector towards a more knowledge-based economy. However, these professionals need to meet a series of requirements the government has released.
Over the last few decades, Dubai has emerged as one of the most investor-friendly cities not just in the Middle East but all around the world. According to the new rules, investors will be eligible for either a 5 or a 10-year residency visa based on the size of their investment in the UAE. So, those who own a property worth Dhs 5 million or more will be eligible for a five-year residency visa. Further, if an investor holds an investment through a deposit in an established company or a business partnership worth Dhs 10 million or more, will receive a renewable residency visa every 10 years. Also, investors who have made investments of at least Dhs 10 million including property (which must not be worth more than 40 percent of the total investment), qualify for the 10-year renewable residency visa.
Not just the investor, but also his/her spouse, children, and one advisor and executive director can get long-term visas. Business partners investing Dhs 10 million or more are also eligible. Investors will receive permission to enter the UAE for a 6-month period with multiple entry permit to apply for the long-term visa. For property investments, it is important that the property or the investment must be wholly owned and not borrowed.
How will the New Visa Rule change the investment market?
According to James Mathew, group CEO at Crowe UAE and Oman, “We hope the long-term visa programme will promote investment climate and boost business confidence. Since expatriates constitute around 90 percent of the UAE’s 9.7 million population, this initiative will have a far-reaching positive impact on the economy.”
In another step to support the real estate market, the UAE Government approved a law which allows investors to stay in the country after retirement if they own a property valued at around USD 545,000.
The residential real estate market in the UAE has always been closely linked with the country’s economic performance. According to the DLD (Dubai Land Department), there was a 12 percent rise in the owner/occupier mortgage transactions in March 2018 as compared to 2017. This demonstrates a maturing effect while highlighting growing confidence among buyers in the UAE. It is expected that this new law might further stimulate the market in the coming years.
This new law is expected to boost those who are already living in the UAE. It would also prove instrumental in attracting investors to the country. In the period prior to this rule, many expats were unsure about relocating to the UAE due to uncertain residency visas. With this rule, the UAE is sending a clear message to the world that it is welcoming talented professionals and is willing to support them and help them feel secure and settled in the UAE. Further, the UAE is also letting the investor and business communities know that they can find one of the most business-friendly policies and support in the Emirates.
Market analysts feel, that this new Visa rule is a clear example of the UAE’s approach to creating an innovative world wherein, talent receives nurturing, entrepreneurs get support, and hard work receives rewards. These new changes will undeniably affect the investment market in the UAE but might take some time to start showing its effects. Think about it, this change will make investors and professionals wanting to live and invest in the UAE feel more secure. The Government has made it clear that it is committed to support economic growth and offer conditions favoring the growth of foreign investments.
A quick peek into the history of the UAE
When oil was discovered in the UAE, the country had focused on developing its infrastructure and building a sustainable and diverse economy. This required a lot of unskilled labor and the immigration and Visa policies were made accordingly. Stepping into the next phase of growth, the country is now trying to move towards a more knowledge-driven economy. This requires a flow of the best talents and minds in different industries and a flow of foreign investments. These new rules are a step in that direction.
Most countries around the globe portray themselves as a business and investment-friendly destination. However, their policies state otherwise. The UAE is making some strong statements through its policy changes. With barely any taxes, investment and business-friendly environment, and an open invitation to talented professionals, the UAE is soon becoming the hub of major business and economic activities in the world. It will be interesting to see how the international investor community responds to these new rules and what changes will the UAE’s investment market witness.