GUIDE FOR GOVERNMENT OF DUBAI ECONOMIC STIMULUS PACKAGE - Economic Research and Sustainable Business Development
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GUIDE FOR
GOVERNMENT OF DUBAI
ECONOMIC STIMULUS PACKAGE
Economic Research and Sustainable Business Development
May 2020
1Dubai Business Advisor
© 2020 Dubai Chamber
All rights reserved
Disclaimer: Information in this guide is obtained from sources deemed reliable, but no warranty – expressed or implied –
is made on any part of its contents. While a good faith effort has been made to ensure the accuracy, timeliness, and
completeness of the contents of this guide, we do not guarantee the information contained herein. Laws, rules, regulations,
and procedures may change significantly with short notice, and this guide may reflect details that, while accurate at the
time the information was gathered, could be currently no longer in effect or otherwise modified. Nothing in this guide
should be construed as legal, accounting, or other professional advice and we will not be held responsible for any changes,
omissions or inaccuracies in the information contained herein. Interested parties are urged to seek the advice of
competent, licensed professionals in the appropriate area of expertise for any further questions regarding their specific
circumstances.
2TABLE OF CONTENT
1. INTRODUCTION ..................................................................................................... 4
2. GOVERNMENT OF DUBAI ECONOMIC STIMULUS PACKAGE ................................. 5
2.1 Dubai “Mainland” ....................................................................................... 5
2.2 Dubai Free Zones ........................................................................................ 7
31. INTRODUCTION
To minimize the negative impact of COVID-19, the Government of the UAE has launched
a vast number of initiatives to support the country’s economic activities, reduce the
costs of living, facilitate business continuity and protect the economic stability. One of
the initiatives was launched in the form of the financial support with contributions from
the Emirates of Abu Dhabi and Dubai, Free Zones and the Central Bank of the UAE.
Government of Dubai launched an AED 1.5 billion economic stimulus package for the
next three months to minimize the impact of COVID-19 outbreak and to support
business sector in Dubai. This package is part of the packages that were announced by
the Emirate of Abu Dhabi and the Central Bank of the UAE, which brings to total value
of AED 126.5 billion.
This business guide provides the reader with insights into the Government of Dubai
Economic Stimulus Package, which has been launched for the period of 3 months (April
– June) to support the business sector in Dubai and enhance liquidity.
On recently updated information, please refer to the United Arab Emirates Government
Portal.
42. GOVERNMENT OF DUBAI ECONOMIC STIMULUS PACKAGE
2.1 Dubai “Mainland”1
Government of Dubai announced an AED 1.5 billion, a short-term economic stimulus
package to enhance liquidity and minimize the potential impact of the COVID-19
outbreak. The package includes various initiatives aimed at stimulating the economy and
employment, supporting businesses, jobs and income, reducing cost of doing business
and simplifying business procedures in the commercial, retail, trade, tourism, and
energy sectors. The Dubai’s key initiatives include:
Initiatives in commercial and business sector
• Freeze on the 2.5% market fees levied on all facilities operating in Dubai.
• Refund of 20% of the customs fee imposed on imported products sold in Dubai.
• Cancellation of the AED 50,000 bank guarantee or cash requirement for customs
clearance activities.
• Refund of bank guarantees or cash required to be paid by existing custom
clearance companies.
• A 90% reduction of fees imposed on submission of customs documents
• Cancellation of bank guarantees required to be submitted before resolution of
customs-related grievances.
• Exemption for traditional wooden commercial vessels registered in the country
from mooring service fees for arrival and departure, and direct and indirect
loading fees at Dubai and Hamriyah Ports.
• 90% reduction for Instant Licenses from AED 3,000 to AED 250, which includes
four legal forms: Limited Liability Company, One Person LLC, Sole Proprietorship
and Civil Company.
• Cancellation of 25% down payment required for requesting installment-based
payment of government fees for obtaining and renewing licenses.
• Renewal of commercial licenses without mandatory renewal of lease contracts.
• Companies exempted from permits for new sales and offers.
1
Dubai “Mainland” also known as “Dubai Customs Territory” is the total geographical area, which is permitted by the DED
(Dubai Economic Department) to all the private business entities and their representative to operate commercial
business functions.
5Initiatives in the tourism sector
• Hotel establishments in Dubai will have their municipality fees cut to 3.5% from
7% on daily sales.
• Exemption from fees charged to companies for postponement and cancellation of
tourism and sports events scheduled for 2020.
• Freeze on the fees for classification/rating of hotels.
• Up to 20% refund on rental values for the restaurants and tourism and
entertainment sectors.
• Freeze of the fees charged for the sale of tickets, issuance of permits and other
government fees related to entertainment and business events.
Initiatives to reduce the cost of living
• Dubai Electricity & Water Authority (DEWA) announced a 10% reduction in water
and electricity bills across residential, commercial and industrial sectors for three
months, including reduction in deposits paid for water and electricity connections
by 10%.
Initiatives for workforce protection
The Ministry of Human Resources and Emiratisation (MoHRE) launched The National
Program for Labour Market Stabilization that includes:
• Lifting restrictions that prevent workers from acquiring new work permits
• Launch of Virtual Labor Market online platform for both job seekers and recruiters.
• Reducing the attendance of workers in the private sector.
• The number of transported workers should not exceed 25% of vehicle seating
capacity.
• Onshore Pay Cut Restrictions. Employers intending to temporarily reduce the
salary of non-Emirati employees may make a “temporary supplement” to their
current employment contract. This is also applicable in case of permanent
reductions to salaries. Both options are subject to MOHRE’s approval and
agreement by the employee.
• As per the UAE Cabinet adopted a resolution to grant paid leave to select
categories of employees at the Federal Government.
62.2 Dubai Free Zones2
Dubai Free Zones have also introduced measures to mitigate the challenges faced by
their businesses and developed various stimulus packages for businesses and residents.
Leading Dubai Free Zones, Dubai Free Zone Council has launched a five point stimulus
package with a contribution from: Dubai Silicon Oasis Authority, Dubai Airport Free Zone
Authority, Jebel Ali Free Zone, Dubai World Trade Centre, Dubai International Financial
Centre, Dubai Development Authority, Dubai South, Meydan City Corporation, and
Dubai Multi Commodities Centre. The package essentially includes five key elements:
• Postponing rent payments for 6 months
• Facilitating installments for payments
• Refunding security deposits and guarantees
• Cancellation of fines for both companies and individuals
• Temporary contracts that allow the free movement of labour between companies
operating in Free Zones.
However, some of Dubai Free Zones have created customized stimulus packages:
DMCC (Dubai Multi Commodities Centre)
These measures will apply from 1 April 2020 until 30 June 2020 (or unless stated
otherwise).
Measures for existing members:
• 100% waiver for late license renewal penalties
• 100% waiver for all Flexi Desk and DMCC Business Centre penalties until the end
of 2020
• 100% waiver of the Office Sharing Permit fee
• 100% waiver of the Company Reinstatement fees
• 30% discount on license renewal
• Waiver of outdoor area rents for JLT retailers with existing contracts
• Waiver of rent for 2 months for commercial establishments
• A 3-month suspension of rent for Flexi Desk and DMCC Business Centre tenants
2
Free Zones are an economic zone where business owners get the benefit of keeping 100% business ownership, and
exempted from a range of taxes such as Income Tax and Corporate Tax.
7Measures for new members:
• Complete digital process for business set up from home
• 80% reduction on the total company set up fee if shareholders are residents of JLT
• Up to 50% reduction on the total company set up fee, along with a Flexi Desk for
1 year
• Flexible payment options for new DMCC Business Centre tenants
SILICON OASIS
Initiatives for Retail
• Tenants exempted from late payment fines until 31 August.
• 10% discount on the rental upon renewal, and an additional 5% discount on the
annual rent
• Marketing fees reduced by 25% up to three months
• Pay outstanding fees in installments, and leverage visa security deposits to pay off
financial dues.
• New companies to get a grace period on monthly rent payments until end of May
2020 and a discount of up to 10% on the monthly rent.
Initiatives for Residential
• Existing residential tenants to pay rents per month and new rental structure
introduced.
• Defer all new and existing lease payments for up to two months and provide
flexible payment plans for the remainder of the lease duration.
• Waive cheque retrieval fees on bounced checks for first offenders.
• Villa tenants to get a discount of AED 5,000 on the rent, while other residential
tenants to get a discount of AED 2,000.
DP WORLD
(includes JAFZA, National Industries Park and Dubai Auto Zone)
• Postponement of rent payments for two months.
• Facilitating instalments for rental payments.
• JAFZA announcement on Payment Flexibility Plan.
• National Industries Park announcement on Payment Flexibility Plan
• Dubai Auto Zone announcement on Payment Flexibility Plan
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