HFI’s Establishing a Middle East Regional Presence eGuidebook

I am delighted to introduce HFI’s “Establishing a Middle East Regional Presence” eGuidebook. Please click here for the interactive flipbook version, and please click here for the static PDF version.

The Middle East is a key growth market and the EIC (Energy Industries Council) (EIC) DataStream project database is now tracking in the GCC 490 energy projects for 2023 and the market value for the region is US$722 billion for the period to 2030:-

  • Oil & Gas (upstream, midstream and downstream) – US$466.8 billion (264 projects);

  • Power and transmission/distribution – US$104.9 billion (90 projects); and

  • Energy Transition (renewables, hydrogen, CCS, energy storage) – US$155.6 billion (136 projects).

Middle East business expansion is typically originated by one or more local partner ventures but sooner or later the need to establish a Middle East regional presence will become compelling. HFI is often asked to plan and implement international group structures and the default position is the establishment of a DMCC free-zone company to serve this purpose. 

A DMCC free-zone company adds ten potential key benefits:-

  • A regional presence to anchor client relationships, local partner ventures and employment/sponsorship of personnel;     

  • 100% foreign ownership without local participation or sponsorship and with limited liability giving ability to ringfence risk;  
  • Tax effectiveness – DMCC companies benefit from exemption from corporation, personal taxes and custom duties – these exemptions apply to business activities within the free-zone and to international locations but corporation tax at 9%, VAT at 5%, customs duty generally at 5% are applicable for onshore entities in the UAE;    
  • Versatility of licensing options to contract into other jurisdictions without forming a permanent establishment, form branches, subsidiaries and JVs;    
  • Multiple options to establish new entities and transfer existing entities in DMCC from other jurisdictions;

  • Rule of Law and investor protection with the UAE and Dubai Governments’ offering excellent track record in protecting and respecting international investor rights; 

  • High regulatory/compliance standards to assist banking & investment as the DMCC Authority operates to high regulatory standards;       

  • Cost effectiveness and automated efficiency as the DMCC regulatory environment is highly automated and efficient;       

  • No exchange/repatriation of funds control which therefore means no impact on the ability to repatriate dividends or shareholder loan repayments; and     

  • Currency stability. The UAE currency is pegged to the US Dollar, the international reserve currency and operating currency for the international petroleum sector.

This eGuidebook captures over 20 years’ experience of lessons learned from supporting clients in their Middle East ventures.

I hope this eGuidebook will be of interest to you, and as always, we would be delighted to discuss and support your MENA business ventures. Please contact sally.reeves@hfi-consulting.com to schedule a call.