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The Growing Trend of Foundations in the UAE
  • Newsletter, U.A.E

The Growing Trend of Foundations in the UAE

What is a Foundation?

Foundation, a less familiar concept than trust is defined as a hybrid of trust and a company resembling a company in which it is a body corporate without any shareholder. It has a separate legal personality with its property like a company. A foundation is governed by a council following its charter and regulations (its constitutional documents) in much the same way that a company is managed by its board of directors following its constitutional documents.

Foundations have no beneficial owners and are, therefore ’ownerless’ structures even where the foundation property is held for the benefit of beneficiaries.


How is a Foundation formed in the UAE?

A Foundation is constituted by the below-mentioned components
  • A Founder, at least one founder as an individual or legal entity.
  • A Council constituted by the Founder with a minimum of two members to manage the foundation.
  • A Guardian as an individual or legal entity appointed by the Founder for mentoring.
  • An appointed Registered Agent Registered Agent only compulsory in RAK ICC with a necessary license from the regulatory authorities.
  • Beneficiaries appointed by the Founder as an individual, group or entity authorized to receive and make payments.
  • A Registered Office as the address of the Registered Agent.
 

What are the different types of Foundations?

Every Foundation has different government regulations and varies depending on the purpose of creating such an entity and include
  • Exclusively charitable.
  • Not charitable.
  • Benefits persons identified in its Charter or By-Laws.
  • A combination of the above three.
 

What are the reasons for the popularity of Foundations in the UAE?

A variety of foundation structures are being implemented to hold trading companies, real estate and liquid investments as investors are pouring in for business setup in Dubai and other six emirates. It is becoming a popular vehicle and offering many benefits including
  • Asset protection as assets are not readily accessible to creditors, governments or other family members.
  • Privacy as the beneficiary details are kept private ensuring the reduced risk of claims and legal actions from third parties against the founders and their families.
  • The flexibility of legal and beneficial ownership enabling families intergenerational legacy planning and wealth protection in different international jurisdictions.
  • Efficient succession planning based on the wishes of the founder under the terms of the foundation with no scope for probates.
  • Better governance of the family in line with a professionally managed corporate governance.
  • Facilitates charities depending on the wishes of the founder.
  • Maintenance of legacy.
 

Where in UAE are the Foundations flourishing?

Foundations have become a popular option for regional wealth structuring and succession planning in the UAE and a growing number of foundations are now available across UAE and are mostly similar with a few exceptions.
  • The Dubai International Financial Center (DIFC), under the governance of the Foundations Law, DIFC Law No. 3 of 2018.
  • The Abu Dhabi Global Market ( ADGM) under the Foundations Regulations 2017 and
  • The RAK International Corporate Centre (RAK ICC) following the RAK ICC Foundations Regulations 2019.

Initially foundations were formed in the DIFC and then followed by ADGM and RAK ICC.

 

How the Foundations in DIFC, ADGM and RAKICC differ?

 
DIFC

The DIFC is the sole regime that allows DIFC company formation to get transformed into a Foundation.

DIFC Foundations are allowed exclusively for charitable purposes where ADGM may not allow unless a Guardian is appointed mandatorily.

A DIFC Foundation can issue securities representing the value of the contributed assets from the contributor and their entitlement to the same and allows user arbitration for dispute resolution. USD 200 is required for registration and yearly renewal of foundations.

 

ADGM

While the identity of the Council Members is available in the DIFC, it is kept confidential from the public in the ADGM.

It is the only regime where foundations are not needed to file and audit accounts unless demanded by the Registrar. Records of accounts however must be prepared and maintained as in other regimes.

ADGM Foundations are not allowed only for charity without additional purposes. USD 200 is applicable as the fee towards registration and renewal every year.

 

RAK ICC

RAK ICC does not maintain a publicly accessible register of information about a Foundation.

Information related to the Foundation benefits from the applicable privacy laws in the UAE and will not be disclosed unless required by the relevant authorities.

Within RAK ICC however, a Registered agent is a mandatory requirement whereas with DIFC and ADGM it is only optional.

Fees: Registration Fee / Annual Renewal (fee as at 2021): AED 750 (approximately USD 200).


What is the essence of a Foundation?

A Foundation is an establishment that can consolidate property and assets under one legal entity and are normally used for the following purposes
  • Private wealth management and preservation.
  • Tax planning.
  • Asset and creditor protection.
  • Succession planning.
  • Financial planning.
 
 

Foundations are also used for charitable purposes

 

Foundations often need legal help for effective wealth preservation through appropriate structuring which can ensure safe and undisputed transfer of assets to the beneficiaries and successors. IMC with a team of legal professionals can render requisite support and help you achieve your goals in this regard.

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UAE Issues Amendments in VAT Executive Regulations Reducing Penalties for Tax Non-compliance
  • Newsletter, U.A.E

UAE Issues Amendments in VAT Executive Regulations Reducing Penalties for Tax Non-compliance

Cabinet Decision No. 49 of 2021 has announced amendments of certain provisions of the old cabinet decision No. 40 of 2017 regulating the Administrative Penalties for Violation of Tax Laws in the UAE. This has also been confirmed by the Federal Tax Authority (FTA) on 29th May 2021.

Before this newly issued cabinet decision 49 of 2021, heavy penalties often used to be imposed on taxpayers for non-compliance with the VAT and excise rules and regulations. Though the imposition of the high penalty was originally aimed for increased tax compliance, it often put the taxpayers in difficult and stressful situations.

The amendments brought in are designed to help tax registrants and support them in fulfilling their tax obligations. It is hoped that the relaxation of penalties passed by the government should enhance the competitiveness of UAE for conducting business.

“The new amendment will become effective on 28th June 2021 and will reduce many administrative penalties imposed for violating tax laws. This comes as part of the wise leadership’s directives to implement the tax system according to the best standards that ensure further growth for the national economy and help achieve transparency and economic momentum, providing an ideal and resilient tax legislative environment that encourages self-compliance and keeps pace with change through constant issuance of decisions in accordance with phased requirements,” highlighted Khalid Ali Al-Bustani, the Director-General of the FTA in a press release on Saturday.

The Director-General wanted the tax registrants to avail the benefits announced in the new amendment. The newly passed decision offers additional reliefs to the tax-paying business sectors and shall support them in meeting their tax obligations with ease effectively contributing towards the enhancement of UAE’s economic growth.

Al-Bustani also stated that 16 different types of administrative penalties under the old cabinet decision of 2017 have either been reduced or the earlier method of calculating penalties amended (TAXP001). He also explained that the reductions are primarily enacted for tax penalties including administrative violations on Tax Procedures, Federal Decree-Law on Excise Tax, and Federal Decree-Law on Value Added Tax (VAT).


Al-Bustani added

“The amendment includes fundamental amendments that provide more facilities to help taxable persons achieve self-compliance and encourage the speeding up of voluntary declaration. Under these amendments, a late payment penalty will not be imposed on voluntary disclosures if payment is settled within 20 business days of submitting the voluntary disclosure, and the sooner the taxable person declares and pays due tax according to periods specified by the decision, the lower the value of the penalties will be. This constitutes an incentive and a good opportunity for tax registrants who have errors in declarations, tax assessments, or requests for tax refunds, to speed up the implementation of voluntary declaration procedures and avoid increasing penalties.”

In a press briefing, FTA noted that the tax authority shall redetermine the administrative penalties (TAXP002) enforced on the taxpayers before the final rollout of the amendment scheduled on 28th June 2021 and will include the reassessment of the penalties which have not been fully paid, to be equal to 30% of the total of such unpaid penalties. It was emphasized that to take advantage of such a scheme, the taxpayers must settle their payable tax in full by no later than December 31st, 2021, and 30% of the total administrative penalties due and unpaid by 27th June 2021, by no later than December 31st, 2021. The detailed implementation procedure shall however be decided on a later date, the FTA remarked.

Two new detailed clarifications on this amendment have already been published by the FTA within the framework of the ‘public clarification service’ provided on the FTA’s official website and as a part of their ongoing awareness program.

The public clarifications hosted on FTA’s website are meant for making the existing and potential taxpayers more acquainted with tax aspects with easier and simpler explanations and help them put into effect the UAE’s tax principles effectively.

01

The first public clarification (TAXP001) includes some basic amendments made to the table of administrative violations and penalties related to the application of Federal Law on Tax Procedures (Cabinet decision No. 51 2021) for ensuring the right interpretation of these amended penalties and with added certainty.

02

The second public clarification (TAXP001) specifies the methods and procedures used for re-determining some of the administrative penalties imposed in the old cabinet decision that would come in force before the effective due date of the new amendment on 28th June 2021.

The Cabinet Decision No. 49 of 2021 however presents both opportunities and threats to businesses falling under VAT executive regulations.

Though an early voluntary disclosure of any tax fallout is encouraged with the enactment of nominal penalties, it would be quite a large amount for cases where non-compliance is not detected timely and not disclosed. It becomes of paramount importance to critically review records and audit findings for identification of non-compliance in VAT payment and preferably get their systems re-audited by an experienced and qualified third party.

It is also important for companies to identify the applicability of disclosure by reviewing VAT treatments in previous years.

It shall also be equally necessary to identify any unpaid tax penalties if the companies can benefit from the tax reliefs announced.


How IMC can help you?

IMC with its many years of extensive and proven experience in tax compliance, management and planning in the GCC region and especially in the UAE can support companies in identifying all taxation and planning aspects of businesses in light of the recent amendments.

Once a business is aware of any tax errors, it will need to consider which penalties may be applicable (e.g. penalties for the errors, late payment penalties, etc.) and the steps that should be taken to minimize the impact of the penalties.

The new amendments in VAT executive regulations are welcome and expected to address the requirement clarifications of the business community before rollout.

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Dubai-business Outlook for Startups and SMEs during Covid Pandemic
  • Newsletter, U.A.E

Dubai-business Outlook for Startups and SMEs during Covid Pandemic

Dubai is one of the most open economies in the world with a strategic location between Asia, Africa, and Europe. Even at a time when the pandemic gripped the world in 2020, Dubai witnessed USD 3.26 billion FDI  during the first half of 2020 and ranked fourth globally with several new business setups in Dubai.

To fuel entrepreneurship and grow the country’s SME sector, a special position of Minister of State for Entrepreneurship and SMEs was created during the July 2020 cabinet reshuffle. The Dubai government also initiated several support services to enhance the non-oil private sector’s contribution to economic growth and in line with the Dubai Vision 2021.

The Dubai government is leading from the front to mitigate the adverse effects of the covid pandemic and regulatory authorities are relentlessly striving to develop and ease regulatory and legal frameworks for Dubai company incorporation besides the identification of alternative funding routes and providing additional government support.

“We find a paradigm shift in the thought process of investors. The freedom to do business and safety are the key drivers of growth in the SME sector. The paperless e-governance added to the transparency and precision in administrative matters. Over the past decade, the UAE has evolved as the most sought-after destination for investors to set up their establishment so that they can cater to clients in MENA, and South Asia,” highlighted Syam Panayickal Prabhu, Founder and Managing Director, Aurion.

Dubai’s 50 free zones reverberate at the core of its startup ecosystem comprising some of the world’s leading free zones including Dubai Silicon Oasis (DSOA) or IFZA, Dubai International Financial Centre (DIFC), Jebel Ali Free Zone (JAFZA), and Dubai Multi Commodities Centre (DMCC) and offer numerous advantages to new businesses including 100% foreign ownership, zero corporate tax, nil import-export duties, 100 percent repatriation of revenues and profits, minimum documentation requirements and easier startup, easy recruitment and visa processes.

Saud Salim Al Mazrouei, Director, Hamriyah Free Zone Authority added, “Free zones are a driving force in the growth of the economy in the UAE. They help stimulate economic development, create jobs, boost and diversify exports, and expedite the industrialization process of an economy at lower costs for the government. Incidents like the Covid-19 pandemic with a sudden drop in oil price can serve as a catalyst for long-term sustainable economic reform.

There are also 6 business accelerators and 5 incubators in Dubai to support startups and SMEs including DIFC’s FinTech Hive and Dtec at DSOA providing support through startup incubation and venture capital funding. The Dubai Future Accelerators program facilitates partnerships between public and private sector organizations and startups in Dubai.

Dubai has long been eyeing a leading world position in innovation and technology, and financial technology acronymed as FinTech playing the most pivotal role in accelerating the business growth of Dubai startups during the covid pandemic. DIFC FinTech Hive is offering accelerator programs for FinTech startups with a total of USD 100 million funding support that has already benefited four companies.   

Most important for the growth of the SMEs and startups is the availability of funds and Dubai is continuing its efforts to look for additional and alternative funding for addressing economic diversification strategy. Venture capital and crowdfunding are being encouraged by the Dubai government for sustaining startups and SMEs even with lower assets and proven and credible track records. As per a survey conducted by Dubai SMEs, almost 9 percent of SMEs received additional funding through the venture capital route.

Dubai also offers abundant diverse and talented human capital and secured top global ranking in terms of employee training and workforce motivation.

Though the IMF and World Bank have lowered the economic recovery forecast for all major economies, Dubai expects a fast V-shaped recovery in 2021 facilitated by Dubai Expo 2020 which promises to add USD 33.4 billion to the UAE economy by 2031.

As the consequences of the Covid-19 pandemic becoming severe, the Dubai government has started firing its arsenals on all cylinders to boost the economic diversification program and focusing on some strategic sectors including commercial trade, tourism, renewable energy, manufacturing, media, financial services, aviation and healthcare, and all SMEs and startups in general.

The increased economic contribution of private sectors to the national GDP is at the top of Dubai’s agenda as per the UAE’s Vision 2021 which was 70% some two years ago and is now expected to reach 80 percent by 2021.

In Dubai, almost 99 percent of companies from the private sector belong to the SME and Startup category and are projected to contribute nearly 46 percent of Dubai’s GDP.

“As always, the UAE is doing a fantastic job at attracting international interest on all levels of business and lifestyle, and therefore, it remains a top-ranked international destination to do business and to live”, commented Karl Hougaard, Founder and Managing Partner, Trade License Zone in a recent interview.

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Saudi Arabia Surpasses SR 2 Trillion FDI Amidst Covid Pandemic
  • Newsletter, Saudi Arabia

Saudi Arabia Surpasses SR 2 Trillion FDI Amidst Covid Pandemic

Saudi Central Bank (SAMA) data reveals that 2020 witnessed the highest inflow of foreign investments in the Kingdom of Saudi Arabia (KSA) surpassing SR 2 trillion (USD 0.53 trillion) and rising 9 per cent YOY despite global economic turmoil caused by covid 19 pandemics. A USD 46.21 billion as new investment from overseas was generated by the KSA that promoted new foreign company formation in Saudi Arabia.

The whooping FDI was termed as significant by Fadhel Al- Buainain, a member of Shoura Council and positioned Saudi Arabia as one of the most attractive destinations for foreign investors because of diversified government investment programs and supportive legislative processes of the country’s investment ecosystem.

Al-Buainain also a director of Saudi Financial Association highlighted that SR173.3 billion investment at a time of global travel restrictions reinforced the fact that KSA effectively handled the challenges caused by the pandemic and successfully addressed the issue of the country’s reserve.

“Certainly, foreign capital is looking for opportunities in emerging markets . . . especially the Saudi market, which provides investment opportunities, safety and rewarding returns, in addition to important partnerships in major global pioneering projects,” Al-Buainain noted.

Partnerships were led by the sovereign wealth fund and the Public Investment Fund and opportunities were presented as a part of the Vision 2030 program, he added.

The increased FDI inflow was attributed to “the significant improvement in the investment environment in the Kingdom” and the up gradation of investment laws, remarked Talat Zaki Hafiz, an economist and financial analyst by profession. He also highlighted big government projects e.g. The Line and renewable energy projects as additional attractions for global investors.

Hafiz said, “The announcement of the SR27 trillions ($7 trillion) that will be spent by the government over the coming 10 years has attracted the attention of foreign investors.”

He also added, “I believe the decision of the government to diversify its economy away from oil has created huge investment opportunities to foreign and local investors.”

KSA issued 466 investment licenses to foreign investors for doing business in Saudi Arabia in the fourth quarter of 2020, a 60 per cent increase compared to the previous year and December adding 189 investment licenses. The overall FDI rose by more than 20 per cent during 2020 and increased 80 per cent to touch USD 1.9 billion with the economy growing to pre-pandemic levels. KSA also made remarkable improvement in the World Bank’s ‘ease of doing business ‘ index, advancing 30 points in the global ranking.

Issam Abousleiman, World Bank regional director for GCC said, “Saudi Arabia’s impressive reforms in doing business this year show its commitment to fulfilling the main pillar of its National Vision 2030 — a thriving economy.”

“Easing the business climate for local entrepreneurs to thrive as well as foreign investors to work in the Kingdom shows a forward path to creating more jobs for Saudi youth and women, and creating sustainable, inclusive growth,” he highlighted.

New businesses and startups witnessed the maximum surge with the cost of starting a new business dipping to an all-time low of 5.4 per cent of per capita income compared to 16.7 per cent in other parts of the MENA region.

“One of the most important factors that attracted foreign investors is the issuance of new legislation and amendments in some existing legislation,” noted Ayed Alblaihshi, a municipal investment specialist.

Access to the online construction permit, easy availability of electricity, enhanced access to credit, easy export and import laws including more transparent insolvency rules are some of the reforms that aided the country in achieving this feat, the World Bank reported.

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UK Prepares for Free-Trade Deal with GCC Countries
  • Newsletter

UK Prepares for Free-Trade Deal with GCC Countries

The opportunity and freedom to strike global trade deals have long been cited as one of the main reasons for the UK leaving the European Union (EU).

In recent times it was also supported by Lord Edward Lister, co-chair of the UAE-UK Business council and a former Downing St chief of staff, revealing to business forums that the UK has made initial advancements towards striking free-trade deals with the Arabian Gulf countries.

Citing trade and business partnership with the UAE as unprecedented, Mr Lister, spoke to an online forum on Wednesday, 28th April 2021 and claimed that significant developments have been taking place for establishing trade ties with the GCC countries.

“There is a lot of work underway at the moment – the consultation is shortly about to start on it – on new trade arrangements into the Gulf, which will be a free-trade agreement,” he added and pointed out the involvement of the UK government in this regard.

“As the UAE reaches its 50th anniversary, the two countries’ friendship is going through a revival at the moment”, commented Ahmed Ali Al Sayegh, Minister of State of UAE & Chairman of ADGM and a co-chair of the business council.

Me. Al Sayegh also highlighted that the UAE and the UK have been taking leadership roles in the covid 19 vaccination drive and are optimistic of complete recovery from the pandemic with a resurgence from the social and economic issues caused by Covid-19.

The UAE Minister of State also noted saying, “This is such a pivotal year for both countries and it offers us an unprecedented opportunity for growing our trade and investment relationship.”

“We have both taken great strides in addressing the Covid crisis by vaccinating and hopefully our economies will be growing back through the investments we are making in infrastructure, technology and skills,” he commented.

It was one year ago when the UK left the EU politically and excited from the Union’s single market at the end of 2020. Since quitting, the UK wanted to forge new trade deals with potential economic partners in the world and especially with the Arabian Gulf countries providing better market access and a more conducive business and investment climate.

The former Chief of Staff aged 71, recently stepped down as the official envoy to the Gulf as he anticipated that developing circumstances of trade deals need someone else to play a bigger role and in a permanent capacity. He also sounded optimistic about the pandemic recovery and hoped for more resilient economies of the two countries with new trade and investment partnerships and business setup in Dubai.

The UAE and UK governments reached a partnership agreement in March, with Mubadala Investment Company as a strategic investment program and agreed to invest a total of 800 million pounds (USD 1.11 billion) in the British life sciences industry and stretched over the next five years.

Rebalancing the economy by adhering to some of the proven principles demonstrated by the UAE has also been a priority for London as the covid 19 pandemics has brought out some weaknesses of the British system to the surface.

“We’ve all learnt some terrible lessons from Covid,” Mr Lister remarked and also added saying, “We’ve got to have a much more resilient supply chain in place.” “The number one area there is food security and agricultural technology”, he noted emphasizing “The ‘build back better’ policy of the prime minister is a desire to increase economic production, particularly in the regions of Britain.”

Investments made jointly with a wealth fund for growth areas is a rare event for the British government as done in the Mubadala agreement in March, Mr Lister added.

He claimed that the recent partnership would unfold increased opportunities and the executive director of Mubadala’s UAE clusters, Badr Al Olama also reciprocated. As per him, this would lead to more investment opportunities and pave the path for more UAE and UK strategic investments and company formation in Dubai.

“We want to develop the new dynamic sectors such as energy transition and life sciences,” Mr Al Olama said.

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Oman Becomes the Fourth GCC Country to Implement VAT
  • Newsletter, Oman

Oman Becomes the Fourth GCC Country to Implement VAT

The Value Added Tax (VAT), a consumption tax system has been enforced in Oman on Friday, the 16th April 2021 and the Sultanate has become the fourth country to join the other three GCC member states including the UAE, Saudi Arabia, and Bahrain to introduce this tax.

VAT was originally planned by Oman Tax Authority (OTA) in October 2020 vide Ministerial Decision 53/2021 and Official Gazette no.1383 publishing the regulations with implementation requirements and provided almost six months to the Omanis to be prepared for this tax. The country also plans to enact income tax in the foreseeable future to become the first Gulf nation to do so.

Oman has levied a 5 per cent VAT in line with the ‘Oman Vision 2040’ to diversify its oil-based economy to non-oil sectors e.g. manufacturing, travels and tourism and logistics and also to address its Fiscal Balance Plan for the future.

Both UAE and Saudi Arabia introduced this tax system on 1st January 2018 followed by Bahrain which implemented VAT after one year on 1st January 2019. The Kingdom of Saudi Arabia has already increased its VAT rate by 3 times taking it to 15 per cent since July 2020 to support its healthcare system including relief works and preventive measures for the pandemic.

An OMR400 million (USD 1.04 billion) has been estimated to be raised from this consumption tax this year that comes around 1.5 per cent of the country’s GDP and would help bring down its fiscal deficit.

A Common VAT Agreement was signed by the six GCC countries in June 2016 and the 5% VAT rate announced by Oman is consistent with this GCC Unified Agreement. There are also provisions made in Oman VAT law for zero-rating and exemptions. It is to be noted that the 5 per cent tax rate is one of the lowest rates as per the prevailing global standard.

While Qatar has planned to implement the VAT system in the second or third quarter of 2021 almost streamlining its tax administration system, Dhareeba; the Kuwait government is yet to confirm the VAT implementation schedule. Kuwait parliament deferred the implementation date many times in the past however as reported by the International Monetary Fund (IMF), the country is likely to enact its VAT law by 2022.

The below-mentioned supplies are treated as zero-rated as per the Oman VAT Law and don’t attract VAT due to social necessity.

  • Supply of certain food products
  • Supply of some specified medicines and medical equipment
  • Investment in gold, silver, and platinum.
  • Supplies related to the transport of goods or passengers made internationally or within the GCC countries including services in connection with transport
  • Cargo and passengers related to international trade
  • Supplies related to oil, oil derivatives and natural gas
  • Some specific supplies made outside GCC countries under certain conditions
  • All goods and services exempt from VAT in Oman and supplied to non-GCC countries


As per conditions outlined in the Oman VAT Executive-Regulation, the following essential services are exempt from VAT as per the Oman VAT Law.

  • Financial services
  • Healthcare services
  • Goods and Services related to health care
  • Goods and services related to education
  • Resale of residential properties
  • Transport of local passengers
  • Renting of properties meant for residential purposes


Certain imported goods also enjoy the VAT- exempt status under Oman VAT law including returned goods, personal luggage, etc.

Excluding the above-mentioned supplies, all other goods and services in Oman attract VAT at the standard rate of 5% and as mentioned in the Oman VAT Law.

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Singapore to work with The UN Member States to Bridge Digital Divide
  • Newsletter, Singapore

Singapore to work with The UN Member States to Bridge Digital Divide

The poorest in our society are the most affected class by covid 19 pandemic with minimum and no access to modern digital technologies including telephone, internet, television, and computers.  

The digital divide refers and reflects this existing gap and inequalities emphasizing the importance of bridging the digital divide by providing digital infrastructures, services, and applications with an all-inclusive approach and empowering unprivileged individuals and societies to effectively utilize the information and communication technologies. It is feared that expanding digital technology can heighten digital inequalities with disinformation, harassment, and abuse, especially to women and children.

For combating the covid pandemic with sustainable growth, the UN President of the General Assembly recently convened a virtual one-day High-level Thematic Debate on Digital Cooperation and Connectivity on Tuesday, 27 April 2021, in the UN’s General Assembly Hall headquartered in the USA. The meeting was headed by the UN general assembly president Volkan Bozkir and aired online with some international speakers delivering speeches.

Singapore Minister of communications and Information, Mr. Iswaran participated in this high-level thematic debate and noted that though covid 19 has speeded up the digital transformation drive through the world, it has also increased the danger of inequalities between “the digital haves and have-nots”.

As per Roland Berger’s Digital Inclusion index 2020, Singapore ranked first among 82 countries across the world and Mr. Iswaran highlighted the need for an “inclusive, innovative, and interoperable,” digital future and expressed Singapore’s willingness to work in unison with other member states of the UN.

The one-day thematic debate stressed the immediate need for political commitment at the highest levels to address the digital divide in the current Covid-19 situation. The debate was held in response to requests made by the member states and was represented by private and civil society sectors including participants from more than 60 countries.

“To ensure that digital transformation efforts are inclusive, countries around the world must recognize the diverse circumstances faced by nations”, Mr. Iswaran deliberated in his speech.

He also emphasized that the measures taken by different countries and the experiences gained can be shared on UN platforms such as Internet Governance Forum for a strong and focused approach on digital inclusion.

“The platform brings together various stakeholders from the private and public sectors to discuss public policy issues relating to the Internet. The UN Roadmap for Digital Cooperation, which was released in June last year, is also a good start,” said Mr. Iswaran.

The UN has come up with a road map for bridging the digital divide that includes achieving universal connectivity by 2030, creating a more equitable world by promoting digital public goods, digital inclusion for all including the most vulnerable sections, strong digital capacity building, protection of human rights, global cooperation on AI, improving digital security, and lastly, a strong and effective architecture for digital cooperation.                 

“Singapore has a Digital Readiness Blueprint that could serve as a useful reference for other countries in fostering digital inclusion”, Mr. Iswaran pointed out.

The Singapore digital readiness blueprint acts as a guide to equip all segments of society including children in lower-income households, senior citizens, micro, small and medium-sized enterprises with digital skills and access.

“Countries must also be innovative in their efforts to end the digital divide”, emphasized Mr. Iswaran.

“The accelerated pace of digital transformation has created opportunities but is also profoundly disruptive to some, and requires complex trade-offs,” Mr. Iswaran narrated.

“In Singapore, the Digital for Life movement that was launched in February will encourage ground-up projects that bridge the digital divide”, he emphasized. As per him, the move shall provide resources to enhance basic computer skills.

Singapore treats the ‘Bridge the Digital Divide’ initiative as corporate social responsibility and advocates a new company set up in Singapore upon the policy of partnerships and collaboration with non-profit organizations and individuals working together for this cause.

The Minister also highlighted the importance of an interoperable digital framework for a brighter global digital environment that would help individuals and businesses gain access to global opportunities.

“In Asian, initiatives like the ASEAN Data Management Framework will help to facilitate the flow of data across borders to unlock new business opportunities, especially for SMEs”, Mr. Iswaran remarked.

He also added that the data management framework shall promote data governance including management and protection of data.

The first ASEAN Digital Ministers’ Meeting held in January approved this initiative led by Singapore.

In an effort towards bridging the digital divide, the Singapore government solicits and encourages mobile, laptop, tablet, and other digital gadgets donations from investors looking for company registration in Singapore.

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UAE Participated In IMFC Meeting
  • Newsletter, U.A.E

UAE Participated In IMFC Meeting

UAE Minister of State for Financial Affairs, Obaid Humaid Al Tayer participated in the recently held spring meeting of the International Monetary and Financial Committee (IMFC) convened in a virtual format together with the annual meetings of the International Monetary Fund (IMF) and the World Bank Group during April 5 to 11 2021.

Ministers of Finance and development, Central Bankers, representatives of civil society organisations and private sector executives attended this meeting to discuss global economic concerns, the latest global economic developments and the financial and economic outlook due to the Covid-19 pandemic. The agenda of the meeting also included poverty eradication, the effectiveness of financial aids, global economic and financial systems including issues of high debt risks and international economic and development policies.

The Minister of State for Financial Affairs emphasized UAE’s resolve to work hand in hand with the international communities to overcome the risks and challenges posed by the pandemic and ensure sustainable economic recovery and growth.

Abdulhamid Saeed, Governor of the UAE Central Bank, Kristalina Georgieva, Managing Director of the International Monetary Fund, and many finance ministers from different countries also took part in this meeting.  

Al Tayer appreciated IMF’s initiatives and timely interventions for world economic recovery with a revised growth prospect of six per cent for 2021 globally from a negative growth experienced during the previous year that also supported more foreign company formation in Dubai.

The minister also echoed similar concerns as reflected by IMF over the possibility of an imbalanced economic recovery in the Mena region widening the inequality gap arising out of disproportionate economic and social effects and stressed upon fiscal priorities aimed for achieving inclusive sustainable economic development.

“We welcome the Global Policy Agenda devised by Kristalina Georgieva, managing director of the International Monetary Fund, as a comprehensive framework for recovery. The UAE will continue supporting the IMF’s endeavours to mitigate the financial and economic repercussions of the pandemic to achieve global recovery and attain strong, sustainable, balanced and comprehensive economic growth,” he remarked.

Al Tayer added that healthcare continued to be the topmost priority including production and distribution of vaccines for speedy economic recovery. He also informed that USE joined the global efforts to develop and produce covid 19 vaccines with a targeted figure of 200 million doses of Hayat-Vax vaccine annually.

The minister welcomed the initiative of IMF to reallocate Special Drawing Rights (SDRs) for middle and low-income countries as it would help them to fund healthcare systems and take preventive measures against the virus. He also appealed for increased lending and technological support to these countries.

He also noted, “Beyond just recovery, we must pursue socially inclusive and environmentally sustainable models of growth as the only path forward in the post-COVID-19 era, where the IMF can support by facilitating the exchange of expertise, supporting capacity building, and enabling funding efforts.”

Al Tayer added: “As a general principle, we urge the IMF to advance its climate agenda in accordance to the Paris Agreement, which enjoys multilateral consensus, by supporting countries to achieve their Nationally Determined Contributions, while considering their national circumstances and development priorities.”

UAE has taken several social, economic and political measures to mitigate the adverse effects of the pandemic and has demonstrated its commitment by promoting new business set up in Dubai, he highlighted. He also made some additional recommendations including maintenance of a strong, adequately resourced and quota-based fund and highlighted the need for transparent communication to win and maintain public trust.

The IMF Board of Governors responsible for monitoring and management of the world financial and monetary system and timely actions on disruptive issues e.g. covid 19 pandemics are provided with appropriate reports and suggestions during the IMFC meetings.

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Everything You Want To Know About Singapore Tech.Pass 2021
  • Newsletter, Singapore

Everything You Want To Know About Singapore Tech.Pass 2021

In an attempt to boost the already developed technological ecosystem of Singapore, the Economic Development Board (EDB) on 12th November 2020 announced the official launching of Tech. Pass specifically targeting the founders, leaders and technical experts with proven experience in globally reputed and established high growth technology companies.

Tech. Pass is a Singapore work permit for foreigners that allows established global tech professionals to come to Singapore for spearheading technical innovations and training the local Singaporeans on the latest technologies. The Tech. Pass is an extension of the Tech@SG programme which was launched in 2019 as part of Singapore’s efforts to attract smart Industry 4 technical talents to promote Singapore’s position as one of the top technological hubs.

Tech. Pass is now included in the Singapore work pass schemes in Singapore, which include the Employment Pass in Singapore and Entrepreneur Pass (EntrePass) however with some differences in administering bodies, validities and fees.

Since the time of launch, the Tech@SG programme has been providing best in class technical talents to many companies in potential growth areas including digital, biotech, cleantech, agritech, fintech, medtech.

This programme has also been providing necessary access to business networks and facilitating employment pass in Singapore (EP) applications for the core technical team members comprising highly accomplished entrepreneurs, business leaders, or technical experts.to Singapore and provides them with flexibility in participating in a variety of activities that can contribute to the tech ecosystem.

However a Tech. Pass holder cannot be automatically eligible for the Tech@SG Programme unless their company meets the separate company eligibility conditions to qualify for the programme.


Tech. Pass offers multiple benefits over other Singapore work passes with greater flexibility in their participation in certain activities in Singapore including

  • Start and run one or more tech companies;
  • Become an employee in more than one Singapore-based companies
  • Become a board of director
  • Be a shareholder or investor
  • Engage in Singapore companies as advisor or mentor
  • Become a Lecturer/ Professor in a Technical Institute
  • Work as a corporate trainer
  • Bring a spouse, children, and parents on either a Dependant’s Pass (DP) or a Long-Term Visit Pass (LTVP).

Singapore has come up with a set of Criteria for Tech. Pass programme with a validity of two years allowing the holder to

  • Start and operate one or more tech companies
  • Be an employee in one or more Singapore-based companies at any time
  • Transit between employers or to an entrepreneur
  • Be a consultant or mentor, lecture in local institutions of higher learning, or be an investor and director in one or more Singapore based companies
  • Sponsor stay for spouse, children, and parents in Singapore on either a Dependant’s Pass (DP) or a Long-Term Visit Pass (LTVP) issued by MOM

Eligibility Criteria for Tech. Pass has been defined by EDB and to be eligible for the pass, applicants must satisfy any two of the following conditions:

  • Drawn a minimum fixed monthly salary (in the last 1 year) of SGD 20,000 or equivalent foreign currency
  • Possess minimum 5 cumulative years of experience and in a leading role in a tech company with a valuation/market cap of at least USD 500 million or at least USD 30million funding raised
  • Have at least five cumulative years of experience in a leading role with major contributions in the design development and deployment of a tech product with a minimum of 100,000 monthly active users or at least USD 100 million annual revenue generation
  • Business owners and any other candidates with annual income over SGD 240,000 or its equivalent in a foreign currency

Tech. Pass is renewable only one time for two years subject to fulfilling the following conditions

  1. An assessable income of SGD 240,000
  2. Assessment is done by the Inland Revenue Authority of Singapore for salaries and/or business income
  3. Proof of Annual business spending of minimum SGD 100,000
  4. Employing at least 1 local PME4 or 3 LQS5 and
  5. Performing a minimum of two roles mentioned in the two below columns and one of which should be from the first column as a minimum

First Column

  • Founded a company engaged in tech-based or tech-enabled products or services
  • Served a top role in a Singapore based Tech company such as Asia Pacific MD, CEO, CTO
  • Worked in at least two Singapore based Tech companies
  • Employed in a Singapore Tech company as a technical team leader and a particular tech field
  • Employed as a Technical Team leader in two or more Singapore based companies

Second Column

  • Served a Board of Director in a Singapore based company and not necessarily a Tech company
  • Worked in Singapore-based start-up as a mentor/advisor
  • Employed in Singapore Institute of Higher Learning (IHL) as a professor or lecturer or adjunct professor/lecturer
  • Engaged as a trainer in some form not covered by 2nd and 3rd points mentioned above such as workshops, corporate training classes etc.
  • An Investor in one or more Singapore based Tech companies.

The Tech. Pass Application Process involves

1. Pre-application activity include verification of eligibility and preparation of supporting documents
2. Applying for Tech. Pass by downloading the Tech. Pass application form for yourself and dependents if applicable
3. Filling up the soft copy of the application form and obtaining an auto-generated payment reference number
4. Taking print out of the application form and getting the form signed with relevant supporting documents specified in the application form
5. Making Payments of SGD 105 for each application via PayNow or Telegraphic Transfer
6. Uploading completed and signed application form with the following documents

  • Payment receipt
  • Travel documents and
  • Supporting documents for dependants confirming your relationship with the DP/LTVP applicant, verification of Vaccination Requirements document issued by HPB, as appropriate

7. Getting the Pass Issued

It usually takes around 8 weeks to process Tech. Pass applications unless there are requirements for additional documents and information.

Once approved, you will receive an IPA letter by email providing 6 months for coming and getting the pass issued for the start work or business activities in Singapore.

The Fees involved is SGD 225 for each pass and SGD 30 for each Multiple Journey Visa, whenever applicable. No extension to the IPA is granted.

The Tech. The pass has come into effect from January 2021 with a quota available for the first 500 applicants on a first come first serve basis.

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India Enjoys Growing Trade and Investment From the UK
  • India, Newsletter

India Enjoys Growing Trade and Investment From the UK

India and the UK share long historic ties and as one of the leading G20 investors, the UK has made an investment of 29.56 billion USD in India since 2020 and the number of UK businesses has jumped more than two times during this period with many new India company formation.

The sectors that have been witnessing strong investment growth are healthcare, consumer goods, retail, and infrastructure. Both the countries have long been working to strengthen and improve the trade and investment relationship including enhancement of collaboration in technology and pharmaceuticals.

India having the world’s third-largest startup base can join hands with the UK which has the third-largest Unicorn base in the world to create business growth and employment.

There is no bilateral free trade agreement (FTA) between the UK and India however as a part of a roadmap to future FTA and during the 14th Joint Economic and Trade Committee (JETCO) meeting convened in 2020; trade and investment ministry officials from both countries committed to set up Enhanced Trade Partnership (ETP) between the two countries expected to be officially launched during the visit of the UK Prime Minister during 2021.

UK Investment Status in India

In collaboration with the Department of International Trade (DIT) and Confederation of Indian Industry (CII), Grant Thornton Bharat a reputed consultancy firm in its ” Britain Meets India” report emphasized a stronger trade and investment relationship between India and the UK, especially after covid and post-Brexit. The report highlighted some facts about some information on UK investment in India as under

  • UK FDI in India increased from USD 898 million in 2015-16 to USD 1,422 million in 2019-20.
  • 572 UK companies in India contributed a total turnover of 46.73 billion USD providing direct employment to 416,121 people
  • The goods and services sector contributed to 26.7 billion USD during 2020
  • India is the preferred country for the UK for economic partnership especially post Brexit
  • Top-ranked sectors being watched by the UK companies are industrial and business service sectors with Maharashtra topping the list of preferred investment destinations followed by Haryana, Delhi, Tamil Nadu, Telangana, and Karnataka.
  • Enhanced and continued business collaboration during post covid made India-UK trade and investment partnership stronger.
  • Supply chains for Indian pharmaceutical products and surgical masks remained uninterrupted for the UK and other countries as humanitarian gestures including future investment for mutual economic prosperity
  • Relentless collaboration between the two countries in the research, design, and manufacturing of vaccine has further enhanced the investment relationship between the two countries
  • Dyson Technology, Aviva Life Insurance, Diageo Business Services, RMD Kwikform, and FMC Technologies have been termed as the fastest growing UK companies in India, and Vedanta, Vodafone, Hindustan Unilever, United Spirits India have become the top 20 UK companies by revenue. I
  • Top UK employers in India include G4S Group, Vedanta Resources, and HSBC Holdings

Sector-Specific Business Opportunities in India for UK Investors

 As per Invest India report, the following Indian business sectors are drawing maximum interest amongst the UK investors

Indian Chemicals sector nearly contributes to 3 percent of world production of chemicals with more than 80,000 products and generating more than 2 million people and permitting 100 percent FDI through faceless automatic route. Tata Chemicals, Atul, Reliance, and Asian Paints are major players in this segment.

The electronics and Telecommunications sector with smartphone manufacturing is the second-largest in the world with a projected turnover of approximately 400 billion USD by 2025. FDI up to 100 percent is allowed through an automatic route. Consumer and industrial electronics, computer hardware, and LEDs do also come under this sector and Samsung, Apple, LG, Intex are the major players.

The Food Processing segment is the second-largest in the world and dairy, fruits, vegetables, poultry, fisheries come under this sector with 55 mega food parks spread across the country. Britannia, Nestle, Amul, and Hatsun Agro are some major players, and 100 percent FDI is permitted through the automatic route.

The E-commerce and Retail sector is the third-largest in Asia and online grocery, e-pharmacy, and social commerce are the sub-sectors. 100 percent FDI is allowed and Adidas, Marks & Spencer, Dyson are some major players.

Aerospace and Defense sector with the second largest armed forces and worth 42.7 billion USD allowing 49 percent FDI under automatic route and 100 percent under the government route with BEL and HAL being the major players.

The IT and Business Process Management (BPM) sector contributes to 8 percent of the country’s GDP with more than 500,000 high skilled professionals.

Why Choose India Over Other countries

As per the recent forecast, India would be the third-largest economy in the world with a huge domestic market and has considerably eased the process of How to register a private limited company in India for improving the country’s ranking in the ‘ease of doing business index.

The following are some reasons that are attracting overseas investors to do business on Indian Soil

  1. India has received 73.45 billion USD FDI inflow in 2019-20 and one of the fastest-growing economies
  2. Global maritime trade to shift from the Pacific to Indian ocean providing India growing economic influence
  3. India improves its position in global innovation index 2020
  4. India has the largest youth population in the world
  5. National Infrastructure Pipeline initiative has been announced and is being undertaken for providing world-class infrastructure facilities
  6. Rising global competitiveness and drastic improvement in Global Competitiveness Index

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