Opening a Petroleum Product Company in Dubai
The United Arab Emirates hold the World’s fifth reserves of oil and gas, most of them in Abu Dhabi. Dubai holds 4% of the UAE’s oil and gas reserves. Not long ago, the Energy Minister of the UAE declared the country will start new development projects in the oil and gas sector, which will represent a great opportunity for both local and foreign investors interested in opening petroleum companies in Dubai and the other Emirates.
The legal framework for petroleum exploitation in Dubai
There are no specific regulations for oil and gas exploration, but there are few federal laws allowing specific investment permissions, called concessions, mainly developed for foreign investors. According to the UAE Constitution, each Emirate has its own petroleum resources and the ruler of each Emirate must decide the way petroleum may be explored and extracted.
In Dubai, gas exploitation and extraction is regulated by the Government of Dubai. In 2009, the Dubai Supreme Council of Energy was established in order to supervise the energy sector. The Supreme Council of Energy may also provide incentives for Dubai companies investing in the energy sectors.
How to set up a petroleum Company in Dubai
As mentioned above, the exploitation and extraction of petroleum-based products in Dubai is approved by the Government through concession agreements. According to the Companies Law, foreign companies are allowed to participate as minority shareholders in state-controlled companies or in state-controlled holding companies in Dubai. There are also special purpose companies, called project-specific concession companies established with the sole purpose of collaborating with international enterprisers.
If you want to set up a petroleum Company, our experts in Company incorporation in Dubai will help with the registration procedure.
The taxation of petroleum companies in Dubai
Dubai has a corporate tax regime, but in case of petroleum companies concluding concession agreements, the Government must assess the terms of these contracts in order to establish tax liability. When it comes to importing and exporting petroleum products, Dubai companies are applied a 5% tax for imports. There are no taxes for exporting petroleum products.
For more information related to investment incentives in the oil and gas industry, please contact our Dubai specialists in Company registration.