By Scott Cairns
One of the mistakes I regularly see international businesses make in the UAE is assuming that the corporate structure they established when first entering the market will remain suitable indefinitely.
It often will not.
A company may initially establish a relatively simple UAE entity because the priority is to start trading, employ someone locally, service a particular client or minimise their cost for market entry. A few years later, the same business may have several shareholders, operations across multiple countries, new business activities, external investors and a very different tax and regulatory position.
At that point, the question is not just whether the existing companies are compliant. It should be whether the structure still makes commercial sense.
When the business outgrows its structure
This is a common challenge for businesses expanding across the GCC. A group might start with one UAE company and subsequently establish operations in Saudi Arabia or another market. Once that happens, matters such as ownership, intercompany transactions, withholding tax, transfer pricing, management charges and where contracts are entered into all become relevant.
Looki...