United Arab Emirates - Country Commercial Guide
Trade Barriers

Includes the barriers (tariff and non-tariff) that U.S. companies face when exporting to this country.

Last published date: 2020-09-12

Tariff-related Trade Barriers

Tariffs

Tariffs and duties are revised constantly, so we highly recommend you reconfirm these regularly and before exporting.

The custom duty on imported goods is 5% (except a few categories including agricultural products and pharmaceuticals). The rate is 50% on alcohol and 100% on tobacco products.

Non- Tariff Barriers

Import restrictions

Only companies in the UAE that have the appropriate trade license can import products into the country. Import controls exist for a number of products including alcoholic beverages, pork and pork products, medicinal substances, printed matter such as magazines and videos, photographic material, firearms, and fireworks.

The entry of many kinds of products has been banned in accordance with the local values, religious beliefs, and morals. The following items are prohibited:

  • Goods manufactured in Israel.
  • Pornographic literature and materials.
  • Special permission is required for the import of:
  • Alcoholic beverages.
  • Drugs.
  • Firearms.
  • Ammunition and explosives.
  • Agricultural pesticides.
  • Industrial alcohol - denatured.
  • Methyl alcohol.
  • Methylated and medicated spirits.

Having A Sponsor, An Agent, or Distributor

In order to do business in the UAE, outside one of the free zones, a foreign business must have a UAE national sponsor and its ownership is limited to 49% unless its business can be found on the UAE Government “positive sectors” list where up to 100% foreign ownership is allowed. The main objective of the positive sectors exception is to motivate major global corporations to invest in the UAE, especially in the fields of innovation, technology, space, renewable energy, and artificial intelligence.

In order to sell in the UAE an agent or a distributor is mandatory. Once chosen, sponsors, sales agents, or distributors are given exclusive rights for non-food products only – the agency law does not pertain to food products. Terminating a non-performing agent, or a distributor, is extremely difficult in the UAE. In March 2010, the UAE issued Federal Law No. 2 of 2010 amending certain provisions of the Commercial Agency Law, later revised in 2015. The amendments prevent the termination, or non-renewal, of a commercial agency unless the principal has a material reason to justify the termination or non-renewal. A principal may not re-register the commercial agency in the name of another agent even if the previous agency was for a fixed term unless: (i) it is amicably terminated by the principal and the agent; (ii) termination or non-renewal is for justifiable reasons that are satisfactory to the Commercial Agencies Committee; or (iii) a final judicial judgment is issued ordering the termination of the agency. The 2010 Amendments also reinstate the specialized Commercial Agencies Committee which had been revoked in 2006. The Commercial Agencies Committee has original jurisdiction over disputes involving registered commercial agents. Any commercial dispute should be referred first to the Commercial Agencies Committee.

In 2011, the UAE Cabinet issued Resolution No. 3 of 2011, “Concerning the Commercial Agency Committee”. The Committee is responsible for receiving applications for settling agency disputes and for cancelling registered agencies. The Committee is permitted to abstain from settling a dispute referred to it and can advise the parties to refer the matter to litigation.

It is extremely important to conduct thorough due diligence on prospective commercial agents and to carefully draft agreements to ensure compliance with the provisions of the Agency Law.