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The UAE Ministry of Human Resources and Emiratisation has issued a ministerial resolution aimed at supporting small and medium-sized enterprises (SMEs) in the UAE through new incentives.
Businesses that will benefit from the new incentives must be members of an accredited fund/programme that supports small and medium-sized enterprises in the UAE, WAM news agency reported.
It said the new incentives included a maximum of five businesses in the Tier 1 category per owner instead of two, as well as a five-year Tier 1 category classification from the date the licence was issued.
Additionally, businesses with a license issue date of less than 5 years are eligible for Tier 1 category incentives instead of 3 years.
The division of the company into three tiers is based on Cabinet Decision No. 18 of 2022, which explains the details of each tier.
Khalil Al Khoori, Acting Undersecretary for Human Resources at the Ministry of Human Resources and Emiratization, said: “The Ministry has launched various initiatives in line with the vision of our wise leadership.”
“Empowering the people of the UAE remains a top priority, as it has been since the alliance’s inception, which encourages all of us to continue working hard to serve them better.
“We are proud of the UAE’s national wealth and its young men and women, who play a key role in efforts to diversify and accelerate economic development efforts to build a dynamic world-leading economy, enhance the country’s economic competitiveness, and encourage innovation and entrepreneurship on its citizens,” he added.
Al Khoori noted: “Empowering SMEs is a strategic priority in the country’s ongoing efforts to develop the UAE’s business sector, and the UAE has made great strides in laying the foundations for entrepreneurship and encouraging innovative start-ups and SMEs. The UAE ranks first globally according to the world The Economic Forum’s Global Competitiveness Report ranks fifth globally in the 2022 Global Entrepreneurship Index and fifth globally in the Innovative Company Growth Index.”
Al Khoori stressed that the Ministry continues to contribute to the nation’s efforts to develop a strong and prosperous economic ecosystem, propelling the UAE to the top of competitiveness and global indicators.
condition
The ministerial resolution outlines five conditions for any SME to be classified as Tier 1 within five years. First, the business owner or all partners must be Emiratis; Second, the business must be a member of a government-approved fund/programme supporting SMEs; Third, it must be managed by the owner itself, or by an Emirati manager; Fourth, The owner shall not own or be a partner in a business restricted by other departments and shall be fined; Fifth, the owner shall not own more than five companies, either as a partner, or as a service agent.
eliminate
The resolution also sets out several circumstances under which the first-tier SME classification will be withdrawn and reclassified as second- or third-tier, depending on the criteria it meets: if a business employs more than 50 employees, or fails to pay employees, or fails to A permit to hire workers for others can be obtained from the Ministry of Human Resources and Emiratisation.
If employees of other facilities work for the business, or if the business is sold or its ownership is transferred to others without notification to the relevant fund/program or ministry supporting the SME, or if it is proven that the business is owned by someone other than its owner or manager in the UAE management, or in the event of any breach of the conditions for classifying SMEs as Tier 1.
definition
A business is defined as a “small” business if it is owned and managed by a UAE national, is a member of a government-approved fund/programme supporting SMEs, and has no more than 15 employees. However, if it employs 16 to 50 people, it is defined as “moderate”.
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