Following a surge in off-plan sales in 2017, the authorities are planning regulatory changes. If approved, Dubai property developers would need to have hit 50% completion for their project, instead of 20% before they can start selling off-plan. Developers would also still need to pay off all land costs.
In a landmark decision, the Dubai International Finance Centre Courts have ruled a claim against Deloitte and Touche (Middle East) for negligence and deceit can go to trial as the judge considers it has a ‘real prospect of success’. The case has been brought against the auditing firm by Nest Investments Holding SAL who were an investor in the collapsed Lebanese Canadian Bank. The Lebanese arm of the firm acted as the Bank’s auditors from 1995 until its liquidation. The case was brought following charges by the US Drug Enforcement Administration and US Treasury. The judgment extends potential liability for Dubai International Finance Centre institutions, like Deloitte and Touche (Middle East) for acts or omissions of foreign agents in non-Dubai International Finance Centre jurisdictions.
The UAE’s President has issued a Road Tolls Law to ease traffic congestion. The Transport Department will determine where the toll gates will go and the amounts to pay. They will also set the operation times and will collect the fees. Its recommendations will be sent to the Executive Council to approve. Abu Dhabi Law No. 17/2017 came into effect on 31 December. Ambulances, the armed forces, civil defence vehicles, public buses and motorcycles will be exempt. Those who fail to comply with it will be fined upto 10,000 AED.
This week the spotlight is on banking and finance developments in the UAE, where the UAE’s Foreign Exchange and Remittance Group which represents businesses engaged in money exchange and remittances in the country has announced it has launched the second edition of the Anti-money laundering (AML) Standardisation Manual in Dubai.
It was launched in 2015 to encourage exchange houses in the UAE to comply with Central Bank Regulations. When the Central Bank released a new set of Exchange house regulations, the Group worked with KPMG to review and redraft the manual in line with the new regulations. The Second Edition is an updated version of the Group’s first standardisation manual. The new edition states clear guidelines for the sale and purchase of foreign currencies and traveller’s cheques, handling remittance operations in different currencies and paying wages through the Wages Protection System, amongst other things.
Elsewhere the country’s Federal Tax Authority has confirmed businesses only have to use their Tax Registration Numbers and don’t need a tax certificate to carry out business. The Authority added tax registration certificates cannot be printed or downloaded with a provisional Tax Registration Number. The Authority’s website allows individuals to verify the Tax Registration Number of any company registered with the Authority for VAT purposes.
UAE: Dubai International Ports has announced it is establishing an investment platform with the Indian Fund for Investment and Infrastructure
Dubai International Ports has announced it is establishing an investment platform with the Indian Fund for Investment and Infrastructure. The aim is invest in Indian ports, stations and logistics sector. The platform will also examine the possible extension of the activities to include river ports, transport, cargo routes and private economic zones close to ports.
Weekly Spotlight: UAE Federal Tax Authority has announced some exceptional amendments to the VAT first accounting period
This week the spotlight is on VAT developments in the UAE, where the Federal Tax Authority has announced it has made some exceptional amendments to the first accounting period for those subject to VAT. The move follows calls from a number of VAT-subject authorities and institutions for an extension. The exceptional amendments include an extension to the accounting tax period from one to three months for some businesses and amending the quarterly tax period, scheduled to end during the first tax period at the end of January or February, to now end on the second tax period. The tax period for some businesses will, therefore, be four months and five months for other businesses. However businesses with a three-month tax period ending in March will not be affected by the amendments.
Elsewhere, the Tax Authority has clarified the import procedures non-VAT registered businesses should follow following the introduction of VAT in the country on 1 January 2018. Non-registered businesses looking to import into the UAE must follow standard customs procedures. They must either complete a declaration and pay through the e-Dirham system or through the eServices portal on the Authority’s website or via a clearing company approved by the Authority at the port of entry. Alternatively they can do so via a freight forwarder approved by the Authority or via a courier company where the goods are delivered to the importer. As well as following standard procedures when importing for re-export, transit, or temporary admission, non-registered businesses must provide a guarantee for the tax due on the imported goods in question, either by entering a previously obtained e-Guarantee reference number on the e-Services portal or via a clearing company approved by the Authority at the port of entry. Alternatively they may do so via a freight forwarder approved by the Authority.
Abu Dhabi’s Global Market has announced amendments to its Data Protection Regulations have been approved. The amendments come into force on 1 February 2018. The amendments include updated defined terms, data breach notification timeframes and deadlines for notifications to the Registrar, along with expanded enforcement provisions. They expand the list of jurisdictions designated in the Regulations as providing an adequate level of protection of personal data. The additional jurisdictions include Andorra, the Dubai International Financial Centre and the Faroe Islands. The amendments follow the establishment of the Abu Dhabi Global Market Data Protection Office last month.
The UAE’s Coordination Committee has adopted Ministerial Decision No 1/8/2017 requiring expatriates looking to work in the UAE provide a good character certificate as a precondition for obtaining work permits from 4 February 2018. The Committee added the certificate should be issued by the country of the expatriate or the country in which they have resided for the last five years. The certificate should be endorsed by the UAE mission aboard or the endorsement offices of the Foreign and International Cooperation Ministry.
Dubai’s Financial Market has announced it has issued two new regulations to allow market participants to implement both repurchase agreements (Repo) and Islamic Murabaha transactions. It follows the UAE’s Securities and Commodities Authority approval of the proposals. The regulations have been issued in line with international best practices as well as after full consultation with various market participants.
This week the spotlight is on education, employment, and immigration developments in the United Arab Emirates, where Ministerial Decision No. 46/2017 has been issued changing the payment terms of substitute teachers in public schools. Nominees with the required specialisations and qualifications will be selected to be a part of a substitute teacher incentives system. Highest priority for this programme will be given to Emirati nominees, followed by children of Emirati women, and then Gulf citizens. The decision has also stated substitute teachers at nurseries will be paid 500 AED per day (for a maximum of five days per week). Substitute teachers will also be paid 100 AED per school periods taught, up to a maximum of 30 periods per week. However, rates will be different for those teaching certain subjects The decision states that the Ministry of Education must include mechanisms for establishing a database of substitute teachers, from which the minister has the right to add, remove or update subjects in this resolution’s third article, in addition to the value of fees paid for specific school activities and subjects. The decision states substitute teachers will be called on to cover for an absent regular teacher, and that human resources procedures set by the Federal Authority for Human Resources must be followed when choosing these teachers.
Elsewhere, a fake story doing the rounds on social media that visas for Pakistani nationals had been suspended has been officially denied by the UAE General Directorate of Residency and Foreigners Affairs. The story was even picked up by TV channels who quoted officials from the Travel Agents Association of Pakistan, who said the visa service has been suspended until further notice, although those who already had a visa would still be able to travel. It was claimed the suspension was temporary and would possibly be changed in the new year.