United Arab Emirates Country Profile

Quick country select

Business Corruption in the United Arab Emirates

UAE FlagThe United Arab Emirates' (UAE) recent economic growth is largely based on a business-friendly environment in which the burden of government regulation is low and services are provided efficiently, attracting substantial inflows of foreign investment. Corruption is not a widespread phenomenon, and occurrences of petty corruption are reportedly uncommon. The financial crisis has, however, popped the construction bubble, and several high-profile corruption cases have come to light, demonstrating a need for stricter controls in the higher echelons of both public and private sectors. Weak and vulnerable to political influence, the judicial system impedes the governments’ efforts to enhance transparency. The government has aimed at containing corruption through several initiatives and efforts, for instance:

  • UAE has the least burdensome tax compliance regulations in the region, significantly reducing the costs and corruption risks for companies when registering a business in the country.
  • The procedures to get an operating licence are straightforward and publicly available in all emirates.
  • Anti-corruption and anti-fraud legislation is evenly enforced, thus providing a strong deterrent to future illegal acts.
  • The State Audit Institution has drawn up an anti-corruption law. The law will be discussed in the cabinet as well as in the Federal National Council and then submitted to the Federal Supreme Council for ratification.

However, the UAE still faces challenges in curbing corruption, including:

  • Information on business and political corruption in the United Arab Emirates is scarce, making an accurate estimation of the extent of corruption very difficult.
  • Market competition in the UAE needs to be improved, for foreign companies still have to rely on local sponsorship if they want to succeed in their business. Moreover, ruling families' involvement in the economy provides for an uneven playing field.
  • There is no civil society organisations working with anti-corruption in the UAE, and there is a scarcity of reports on the issue.
  • The absence of financial disclosure laws for public officials makes the effective implementation of anti-corruption policy difficult.

February 2014
GAN Integrity Solutions