Canadians to stay outside the country for one month for new UAE visit visa

Canadians need to stay outside the country for one month before they can apply for new visit visas in a stipulation similar to one set out for people of certain nationalities who are required to have a visa in advance to enter the UAE, official said yesterday.

Officials said the same visa rules that are applied to people of certain other nationalities who are required to be in possession of a visa before entering the UAE will apply to Canadians as well.An official from the Ministry of Interior said that the new rules will take effect from January 2.

Canadians who hold regular passports and intend to travel to the UAE need to apply for visa in advance for visit, tourism and business purposes, the official said.

The official added that Canadians seeking to enter the UAE on a visit visa could get their papers processed through a sponsor who could either be a person or a company.

Transit visa

The official said that those Canadians going to the UAE as tourists could apply for tourist visas through hotels or travel agencies in the UAE.He said the same rules that were applicable to people of nationalities requiring an advance visa to enter the UAE would henceforth apply to Canadians, who were earlier exempted from visa rules.

Canadians transiting through the UAE will be able to obtain a transit visa at the airport upon presentation of travel documents indicating that they will leave the UAE within 96 hours to their onward destination, the official said.

"In the past a Canadian with regular passport could enter the UAE after obtaining visa upon arrival. Now the rules have changed," he added.

The UAE Embassy noted that a "short-term visa" will cost C$250 and would be valid for 30 days, a long-term visa for three months would cost C$500 and a six-month multiple-entry visa will set travelers back C$1,000.

He added that Canadians with diplomatic and special passports are required to obtain their UAE visa from the UAE Embassy in Canada before their travel.The official said Canadians visiting the UAE would also have to ensure that their passports were valid for at least six months beyond the date of entry into the country.

New UAE visa charges hit Canadian travellers

Canada's Conservative government is under fire from Liberal Opposition critics on home soil after the UAE Embassy in Ottawa announced new visa charges of up to C$1,000 (Dh3,660) for Canadian visitors to the UAE.

Formerly free for Canadians, UAE visas must now be paid and applied for in writing to the UAE Embassy in Ottawa two weeks in advance of entering the UAE.The new paid visas are mandatory effective January 2.

 

The new visa regulations were first announced in early November, as Canadian troops were vacating Camp Mirage.

Dubai expelled hundreds of Canadian troops from a semi-secret military base on its soil earlier this fall. The Canadian military had enjoyed rent-free access to Camp Mirage for the past nine years. The base served as a key transit point for troops shuttling to and from Afghanistan. Relocating to a new base may cost more than $300 million.

 At the time the U.A.E.'s ambassador to Canada, Mohamed Abdulla Al Ghafli, told the Canadian Press that the decision to institute visa fees was "based on a policy of reciprocity." Weeks later, the U.A.E.'s economic minister, Sultan Al Mansouri, said that Canada's relationship with his country had been "destroyed" by the airline dispute and by remarks made by Canadian officials.

"There have been some statements made from the Canadian side, which were sometimes very fiery statements," Al Mansouri was quoted as saying in Abu Dhabi's The National newspaper. "This is not the way relationships between two countries are handled." In late November, then transport minister John Baird defended how Ottawa handled the landing-rights negotiations, arguing that "literally tens of thousands of jobs" were at risk at home.

Canadian Prime Minister Stephen Harper is being accused of damaging formerly strong ties with an important Middle East ally by refusing additional landing rights for the UAE's two major airlines, Emirates and Etihad.The airlines asked for more than the current six flights a week to Canada but were rejected.In a previous statement, Abdullah Al Gafi, UAE Ambassador to Canada, said failure to reach a new agreement "undoubtedly affects the bilateral statement".

Canadians travel to United Arab Emirates to pay stiff visa fees from January 2, 2011

Canadians wishing to travel to the United Arab Emirates will have to pay stiff visa fees of up to C$1,000, C$250 for a 30-day visa,C $500 for a three-month visa and a whoppingC $1,000 for a six-month, multiple-entry visa . Canada had been one of more than 30 countries whose citizens could travel to the U.A.E. on a free one-month visa. The new fees, which are unusually high by international standards, appear to represent the latest episode in a diplomatic row over landing rights for U.A.E.-based airlines in Canada. The new paid visas are mandatory effective January 2.

"The complete visa application needs to be sent to the UAE Embassy 15 working days before the departure date," the embassy said in its requirements, posted on Tuesday.

The UAE Embassy noted that a "short-term visa" will cost C$250 and would be valid for 30 days, a long-term visa for three months would cost C$500 and a six-month multiple-entry visa will set travelers back C$1,000.
Requiring an approved UAE visa in advance of arrival is a radical departure from the time when Canadians were granted visas upon arrival at Dubai and Abu Dhabi international airports.The new rules won't necessarily affect a large portion of the roughly 25,000 Canadians who live and work in the UAE because many already possess residence permits.

Official pardon for workers with six-month visa ban in UAE from January 1st 2011

Workers will be issued new work permits from January even if they have not served the full six-month ban, Acting Director-General at the Ministry

Expatriate workers who have received a six-month ban on leaving their jobs recently will be able to obtain new work permits from January 1, if they have completed two years with their former employers, a senior official from the Ministry of Labour said.

Humaid Bin Deemas, Acting Director-General at the Ministry, said these workers will be issued new work permits from January even if they have not served the full six-month ban.

“Following the implementation of the new rules by the Ministry of Labour, expatriate workers who have completed two years with their employers can change jobs without serving the ban,” Bin Deemas told Sharjah Radio.

He said sponsors cannot force employees to continue to work for them if the workers do not wish to do so. “If workers have quit before the completion of two years then they will not be issued labour cards until the two-year period is over,” Bin Deemas said.

The official said if a worker, who has cancelled his residence visa, returns to the UAE on a visit visa, he will not get a work permit before the expiry of the two-year period.

Bin Deemas said the relationship between a sponsor and a worker will end with the expiry of the labour card, which is limited to two years. “Skilled and unskilled workers who end their contracts legally will get a labour permit,” he said.

National ID card deadline In UAE extended to June 30, 2011

Emirates ID card deadline extended, Dr Ali Al Khoury, Director-General of Eida, has urged white-collared expats to not wait until their visa renewal, cautioning that the government will soon link the ID card with a string of services in the country, which may not be accessible without the ID.

Unlike blue-collared workers, professionals have to perform many transactions with the government and without an ID card, they will not be able to access many services, Al Khoury has been quoted as saying by Gulf News. "So they should not delay the registration," he added. The extension in the deadline will nevertheless bring relief to applicants, some of whom were seen last week camping outside ID and typing centers in a last-ditch effort to meet the December 31 deadline.

As reported by this website earlier, the authorities had announced that residents who would not have met the National ID card deadline of December 31, 2010, were not to be denied any government services as no penalties were to be imposed.

Eida announced yesterday that 1.5 million people had registered for the ID in 2010, adding that it would do its utmost to double these numbers in the upcoming period as per the new registration plan and the relevant initiatives. Emiratis have an additional six months to register for their identity cards following an extension of the original December 31 deadline.

The Emirates Identity Authority (EIDA) said that Emiratis now have until June 30 to register for their ID cards. Expatriates also do not have to rush for it to register; whenever they apply for or renew a residency visa, the registration for the ID card will take place simultaneously.

Residents can apply for their cards at any of the 25 registrations centers countrywide that are attached to or near to the preventative medicine centers that conduct medical checkups as part of the visa application process.

According to a statement by EIDA, this is part of their 2010-2013 strategy to link visa issuance and renewal with ID card registration across the UAE. This is currently the case in Umm al Quwain only.EIDA said that more than 1.5 million people registered for their national ID cards in 2010.

One-year ban for breach of Limited contract- Ministry of Labour UAE

The new regulations concerning the abolition of the six-month work ban and the removal of the need for a no-objection certificate created confusion and misunderstanding among the employees and has also resulted in workers in some sectors resigning from their jobs. The Ministry of Labour  clarified very clearly that “Workers who are contracted on fixed-term contracts cannot breach the contract and resign on grounds that they have completed a period of two years. If those workers are called to cancel their labour cards they will be subjected to a one-year ban according to terms of the contract. But if the contract is of an indefinite duration, and two years have been completed with the sponsor, they have the right to change their job without objection.”The Ministry of Labour, on Friday, issued regulations allowing workers who finish their contracts to obtain new work permits without undergoing the six-month work ban, and allowing them to move to other firms without the employer's approval from January 1, 2011.

A worker with an expired contract can obtain a new work permit and shift to another employer without the passing of the currently legitimate six-month period and consent of his sponsor, according to the new resolution issued by the Minister of Labour Saqr Gobash.

The new regulations on conditions and criteria of issuing new work permit for a worker after the expiry of his service contract and transfer of sponsorship will take effect as of January 1, 2011 in implementation of the cabinet resolution No 25 of 2010 regarding internal work permit at the Ministry of Labour.

Once operational, the new regulations will replace the current formalities of transfer of sponsorship for expatriate workers.

The resolution says that the new employment permit will only be granted to the worker after the end of his work relationship with his employer without consideration of the legitimate six month period which is usually calculated after the cancellation of the worker's labour card.

Employer can’t ask a ban on a worker if he fails the contractual obligations

Non-competition clause does not apply if employer fails the contract, the clause included in employment contracts to prevent an employee from working for a competitor does not apply if the employer does not meet the contract obligations, said a senior Ministry of Labour official.

The clause included in employment contracts to prevent an employee from working for a competitor does not apply if the employer does not meet the contract obligations, said a senior Ministry of Labour official.

Humaid Bin Deemas, Acting Director General at the ministry, said that an employer cannot ask to enforce a ban on a worker who joined a competitor if he did not fulfil his contractual obligations.

Deemas was commenting on an employer who asked the ministry to enforce a ban on one of his previous employees because he broke the non competition clause but the ministry refused as the employer did not meet his contractual obligations according to a court ruling.

Restriction to freedom

"The non competition clause is a restriction to the worker's freedom therefore they are several rules that limit the use of the competition clause," said Deemas adding that it should not be applied without regulations. The non competition clause should not be applied for anybody who is below 21 years, it should only be applied for jobs in which the employee would have had access to the company's secrets or acquainted with its clients.

Also it should be only for a limited time period, according to article 127 in the labour law.

There are 2800 professions registered at the ministry of labour out of which only some can have a non competition clause to be included in the employment contract, according to Deemas. "It is important to understand that the non competition clause cannot be used merely as a mean to prevent the movement of workers and cannot be applied for all job categories." said Deemas. "The real purpose of the clause is to safeguard the employer's lawful interests," said Deemas.

"If a non competition clause is applied for example for constructions workers it is immediately considered not valid as the nature of the job does not enable the worker not have access on companies' secrets or make him interact with its clients," he said.

New regulations in UAE Labour Law aim to liberalise labour market

The aim behind the new labour law that will come into effect on January 1, is to lessen the control of employers over employees and liberalise the labour market, a top government official told .The source clarified that the new law completely scraps the "no objection certificate" (NOC).

"The new laws allow an employee to transfer his sponsorship after the contract with his current employer expires, but the employee must inform his sponsor that he will not be renewing his contract 30 days before its expiry," he added.

"The employee will be granted a period of 30 days once his contract expires to find a new job and sponsor. This period is basically given to the employee to complete procedures such as the issuance of a new visa in accordance with the Ministry of Interior's procedures and signing the contract with the new sponsor. However, if the period expires and the employee's paperwork is not completed, he will be considered illegal," added the source.Once the employer and employee's pact was regulated by a contract, the ministry would not be able to interfere in matters pertaining to both parties in accordance with Law number 129 in regard to regulating the relationship between both parties.

"When the contract expires, the employee is granted a special permit by the ministries of labour and interior, allowing him to stay in the country for 30 days to complete paperwork and finalise procedures for the new work visa under the new job and employer," the government official said.

Under the new system, if an employee completed the two-year working period, the employer had no right to force an employee to stay on the job and would no longer face a six-month ban, since the new system scrapped the NOC.

Humaid Bin Deemas, Acting Director-General of the Ministry of Labour, told once a job contract expired or was legally terminated, the Labour Ministry would have the authority to allow workers to take up new jobs without the consent of former employers or the so-called NOC.

"Workers, skilled and unskilled, who end their job contracts legally and complete at least two years of service, will get a labour permit outright," he said.Previously, these workers had to complete at least three years of service with their previous employers and had to obtain an NOC letter.Professional and skilled workers in the first three categories according to the Uniform Gulf Occupational Classification would also be exempt from the six-month ban.

He estimated these three categories (the first category with university or post graduate degrees, the second with less than university degrees and the third category including skilled workers with high school degrees) included 800,000 workers.

Bin Deemas said even for unskilled and semi-skilled workers, companies would lose the right to stop them from getting other jobs if the firm failed to honour its legal or contractual obligations, for example, by not paying salaries for 60 days and not offering proper accommodation. Workers, he said, could also take up new jobs if the employer stopped the business for economic or technical reasons and these workers reported the closure to the Labour Ministry within 60 days.

Bin Deemas said the UAE as determined to protect the rights and welfare of the workers as well as their employers "but these rights and benefits will be fulfilled in keeping with the law. It is not the employer's right to approve or disapprove switching of jobs. But it is his right that workers complete the job contract in the event of contracts with limited period".

Concerning fees, Bin Deemas said a resolution would be issued shortly determining a complete set of "more affordable fees".

Previously, workers had to pay job-switch fees, which were determined according to service of the worker, the category of the business among other factors and which reach up to Dh14,000.

The government official added that the goal behind the ministry's new law was to bring the labour market's level on a par with that of Germany, Canada, the US and other Western countries, as well as cancelling the employers' monopoly of the labour market. The new rules defined three cases in which the worker shall have the right to get a work permit without fulfilling the condition of working at least two years with the employer:

When joining his new job, the worker should be classified in the first, second or third professional class and that his salary should be not less than Dh12,000, Dh7,000 and Dh5,000 if he is in the first, second and third class respectively. nNon-compliance of the employer with legal and labour obligations towards the worker or in the event the worker has no role in terminating the work relationship

Professional and skilled workers in three categories exempted from the six-month ban -Humaid Bin Deemas, Acting Director-General Ministry of Labour UAE

The new rules defined three cases in which the worker shall have the right to get a work permit without fulfilling the condition of working at least two years with the employer:

When joining his new job, the worker should be classified in the first, second or third professional class and that his salary should be not less than Dh12,000, Dh7,000 and Dh5,000 if he is in the first, second and third class respectively. (these three categories the first category covers skilled workers with university or post-graduate degrees, the second those with less than university degrees and the third category covers those with high school degrees) Non-compliance of the employer with legal and labour obligations towards the worker or in the event the worker has no role in terminating the work relationship;

Workers who complete at least two years of contract period will not need former employer's consent to switch jobs Beginning January 1, 2011, foreign workers switching jobs will not need a no-objection certificate from former employers as the Ministry of Labour will make the decision, a senior official said on Sunday."Workers, skilled and unskilled, who end their job contracts legally and complete at least two years of service, will get a labour permit outright," he said.

Previously, workers had to complete at least three years of service with the previous employers and had to obtain a no-objection letter to avoid a ban.

In the case of unskilled and semi-skilled workers, a company failing to honour its legal or contractual obligations will lose the right to stop them from getting other jobs. This includes not paying salaries for 60 days and not providing proper accommodation.Workers can also take up new jobs if the employer stops the business for economic or technical reasons and these workers report the closure to the Labour Ministry within 60 days.

Bin Deemas said "it is not the employer's right to approve or disapprove switching of jobs. It is his right that workers complete the job contract in the event of contracts with limited period."

No six-month work ban from January 1, 2011 in UAE

Expatriate workers can move to new employment without no-objection certificate if they have served out two-year contract.The Ministry of Labour has issued regulations allowing workers who finish their contracts to obtain new work permits without undergoing the six-month work ban, and allowing them to move to other firms without the employer's approval from January 1, 2011.

A worker with an expired contract can obtain a new work permit and shift to another employer without the passing of the currently legitimate six-month period and consent of his sponsor, according to the new resolution issued by the Minister of Labour Saqr Gobash.

The new regulations on conditions and criteria of issuing new work permit for a worker after the expiry of his service contract and transfer of sponsorship will take effect as of January 1, 2011 in implementation of the cabinet resolution No 25 of 2010 regarding internal work permit at the Ministry of Labour.

Once operational, the new regulations will replace the current formalities of transfer of sponsorship for expatriate workers.

The resolution says that the new employment permit will only be granted to the worker after the end of his work relationship with his employer without consideration of the legitimate six month period which is usually calculated after the cancellation of the worker's labour card.

But it stipulates two must-do conditions. firstly, the two contracting parties must have ended their work relationship cordially and secondly, the worker should have worked with his employer for two years at least- the duration of the new labour card which will be issued by early January.

The resolution defines two cases where the worker can obtain the new work permit after the end of the contractual relationship without the agreement of the two contracting parties.First, when the employer fails to honour his legally or contractual obligations. Second, in the condition of expiry of work relationship where the worker takes no responsibility such a complaint filed by the worker against his firm.

In this case, an inspection report should prove that the firm is out of business for more than two months and that the worker should have reported to the ministry.

The labour dispute should have been referred by the ministry to the court provided that the court hands out a final verdict ordering the employer to pay to the worker salaries of two months at least, compensation for the arbitrary sacking or terminating the contract prematurely, or any other rights.

The resolution also defines three cases where the worker shall have the right to get a work permit without fulfilling the condition of working two years at least with the employer.Firstly, when joining his new job, the worker should be classified in the first, second or third professional class and that his new salary should not be less than Dh12,000, Dh7,000 and Dh5000 in the first, second and third class respectively.Secondly, non-compliance of the employer with legal, labour obligations towards the worker or in the case where the worker has no role in terminating the work relationship.

Thirdly, shifting of the worker to another firm the employer owns it or has stakes in it.Minister of Labour Saqr Gobash said the new measures aim to infuse broader flexibility in the labour market and strike a balance in the contractual relationship between the employer and worker."The Ministry will only interfere in the employer-worker contractual relationship if it detects infringement in obligations stated in the labour contract," he explained, affirming the ministry's determination to guarantee rights of both parties legally as we live in the State of law and institutions.

"Giving the private sector more freedom of movement will have automatic impact on employers by the way of preserving their interests through creating many options for recruiting skillful workers as per the supply-demand equation.

He indicated the new measures were subject to dialogue and consultation with local stakeholders in implementation of directives of the wise leadership for crafting policies and legislations that fit well into the developments in labour market and curb any malpractices.

"The new regulations constitutes key elements of labour reforms which part of them have already executed and the other parts will be in place in the near future," he said.These measures, he said, were expected to play a major role in advancing efforts towards creating an efficient labour market and sharpening competitiveness and transformation towards a knowledge-drive economy.

End of service - Employees in UAE

The End of Service Gratuity: from Article: 132 Labour Law UAE

1. How the End of Service Gratuity is determined? From Article: 132:

The worker deserves the End of Service Gratuity if he completed one year or more in the service…and it shall be calculated as follow:

A- 21 days for each year from the first 5 service years

B- 30 days for each year if his service years have exceeded the same.

However, the total End of Service Gratuity should not exceed the salary of two years.

2. Shall the leaves without pay be calculated within the service period? Article: 132:

The period of leaving the work without pay shall not be included within the service period.

3. I have worked with my employer for two years and 5 months…, shall the End of Service Gratuity be calculated for the parts of years? Article: 133:

The worker shall have the right to have the End of Service Gratuity for the part of the year if he has completed one year of service or more.

4. Shall the End of Service Gratuity be calculated for the total salary? Article: 134:

The End of Service Gratuity shall be calculated according to the last salary, (Basic) obtained by the worker…, this shall be true for all workers getting their salaries on monthly, weekly or daily basis…, and shall be calculated based on the average salary forworkers receiving their salaries based on piece. So the allowances shall be included in the basic salary, such as: the accommodation allowance, transportation, overtime and other allowances…………etc.

* Important: A worker who receives his salary on piece…,e.g. He may receive DHS. 1000 for the piece…,

or DHS. 500 for the piece…, in this case the average salary only should be calculated, i.e. * His total salary for 6 months…, to be divided over 6…to obtain the average salary: Total salary for 6 months = 25000/6 = DHS. 4166 which is the average salary

5. If a worker died, shall his employer pay his End of Service Gratuity? Article: 136:

If the worker died, his employer must pay his End of Service Gratuity to his hires.

6. I have worked with my employer for the year 1975, i.e. before the issuance of the Labor Law in 1980; shall I have the right to claim for the End of Service Gratuity for my service period with my employer before the issuance of the Federal Labor Law in 1980? Article: 136:

The worker shall not be entitled to have the End of Service Gratuity for the period before the issuance of the Federal Labor Law in 1980 unless the worker was a national citizen.

* The Unlimited Period Contract: In case the worker has ceased working:

7. Kindly show how can the End of Service Gratuity be calculated if the worker has ceased working when he is employed under unlimited Period Contract? Article: 137:

1- If the worker’s service period is not less than one year and not exceeding 3 years, he shall be entitled to have 1/3 the value of End of Service Gratuity, i.e. 7 days in each year.

2- If his service period has exceeded 3 years but less than 5 years he shall be entitled to have 2/3 the value of End of Service Gratuity, i.e. 14 days in each year.

3- If his service period has exceeded 5 years he shall be entitled to have 21 days as a value of End of Service Gratuity for each year of service.

* And if the service period has exceeded 5 years he shall have 30 days as End of Service Gratuity for each year of service.

* Example:I have worked with my employer for 2.5 years, how can my End of Service Gratuity be calculated, knowing that I have ceased working on my own will, and I have unlimited period contract with a salary of DHS. 1500?If the service period does not exceed 3 years, this worker shall have 7 days End of Service Gratuity for each year of service…parts of the year shall also be included, i.e. The two years shall be multiplied by the Gratuity’s days: 7x2 = 14 days - In case the employer has dismissed a worker of an unlimited period contract without reason after completing one year of service…, such worker shall have the right to receive 21 days End of Service Gratuity for each year:

* Example: - If the worker has worked for 3 years and 7 months and his employer has then dismissed him, such worker shall be entitled to have: - 21 days for each year if his service period didn’t exceed 5 years. - 21x 3 + 21/12x 7= 75 days

* Other Example: A worker of unlimited Period Contract was dismissed after completing 6.5 years of service , He shall be entitled to have an End of Service Gratuity of: 21x5+ 30+30/6 = 105+ 30 + 15 = 150 days, whereas 21 days were calculated for the first 5 years…, and 30 days each year for the above to this.

* TheLiimited Period Contract: - In case the worker has cancelled his labor contract: Article: 138:

If the worker has willingly ceased working before completing the contract period…, he shall not be entitled to have the End of Service Gratuity…, unless his service period has exceeded 5 years.

* Example: A worker with a limited period contract which has commenced on 4/4/2004 and expired on 3/4/2007, he has submitted his resignation letter on 25/5/2005 and before completing the contract period, the worker has cancelled the contract, such worker shall not have the right to receive the End of Service Gratuity.

* Example: A worker with limited period contract which shall start on 4/4/2001 and expires on 3/4/2004. This contract was renewed for further 3 years ending on 2/4/2007. This worker has submitted his resignation letter on 20/11/2006…, in this case the said worker shall be completing 5 years and 7 months of service. Then he shall have the right to receive the End of Service Gratuity as provided for in Article: 138. This because his service period has exceeded 5 years * 5 x 21 + 30/12 x 7 = 105 + 17 = 122 days

* In case the employer has cancelled the labor contract: In this case the worker shall have the right to receive an End of Service Gratuity if his employer has dismissed him without reason, in amount equal to 21 days for each year provided that he has completed one year of work, and 30 days for each year if his service period has exceeded 5 years.

8. When shall the worker be banned from having the End of Service Gratuity? Article:139:

The worker shall be banned from having the End of Service Gratuity in two cases: * If the worker was dismissed from the service for any reason set forth in Article: 120 of the labor law…, or if he left the work for the purpose of avoiding dismissal for the same reason

* If the worker has willingly ceased working without notice…, and for reasons other than those shown in Article: 121 of the law, and if he is working under unlimited period contract…, or if he didn’t complete 5 years of service with regard to the limited period contract…, and submitted his resignation letter.

9. I have worked with my employer…, whereas present in the establishment a box called the “saving box” in which the employer was used to put in it an amount of money for the account of the workers as an End of Service Gratuity…, in case I have reached my end of service period, shall I deserve to have from such amount? Article: 140:

* The worker shall have the right to receive from this amount, if the employer is depositing the same in the saving box against his legal obligation towards the End of Service Gratuity…, and if it was stipulated in the saving box as such.

* The worker shall have the right to receive What he was entitled for from the saving box in addition to the End of Service Gratuity if the saving box didn’t stipulate that What was deposited by the employer in the said saving box is against the employer’s legal obligation towards the End of Service Gratuity.52. I am working in an establishment, in which the system of pension and insurance is adopted…, in case of my end of service; shall I have the right of option between having the pension and the End of Service Gratuity? Article: 141:

According to Article: 141: The worker may chose between having the pension and the End of Service Gratuity or to have his dues in the pension or insurance box or whichever preferred to him…, (except with regard to nationals, whereas the Pensions and Insurance Authority’s terms shall be valid wherefore)…, Law No. 7 for the year 1999 regarding Social Pensions and Insurances.

Return Tickets

* The return tickets shall be in the worker’s account if he resigned without reason before the expiry of the limited period contract or resigned with respect of the unlimited period contract.

* The return tickets shall be in the employer’s account if he dismissed the worker, without reason or cause provided for in Article: 120

* The return tickets shall be in the employer’s account if the worker has completed the limited period contract.

UAE consider changes to end-of-service gratuity policy for expatriates

Under UAE law, all employers must pay employees an end-of-service gratuity. It is meant to serve a similar role as pension schemes do in the West and parts of Asia.

UAE officials have had preliminary discussions with the International Labour Organisation and several consultants in the region about requiring companies to set aside the money for employee gratuities, instead of paying them out of the operating budgets. This would ensure the funds remain available in case the company encounters financial problems.

An end-of-service gratuity: the name makes it sound so generous, like a tip received from an employer in exchange for outstanding service.In fact, the gratuity foreign workers in the UAE receive is mandated by the UAE Government to compensate for the absence of a true pension scheme. But the payment is not fully guaranteed nor widely understood and as a result, there are talks about reforming the current system.

The UAE is in talks with the International Labour Organisation (ILO) about either establishing a Government-run pension fund for expatriates or requiring employers to set aside employee gratuities in a separate pool to ensure it is available when employees qualify for it.

Currently, almost all companies pay gratuities out of their general operating budgets, which can lead to problems if a company runs into financial trouble.

"It is not always paid. I receive letters every day from employees who say they do not receive their salary or end-of-service benefit," says Maurizio Bussi, the deputy regional director for Arab States at the ILO, who adds that the UAE Government is "looking seriously" at the proposed changes. "There is a commitment from the Government in principle that the workers should be paid."

The combined liabilities of companies in the UAE for end-of-service benefits is more than US$4 billion (Dh14.6bn), according to research last year by the consultancy Watson Wyatt. For the GCC, it totals more than $15bn. Those figures are believed to be growing rapidly as employees stay in their jobs longer after the financial crisis. This is significant because gratuities are paid out based on an employee's final salary, although many employees leave their jobs without knowing what they are owed.

"We are seeing that the employee, more often than not, just does not understand it," says Jahangir Aka, a Dubai-based senior executive officer with SEI, a global investment firm that helps to manage pension funds. "He thinks it is like pension law in the West [and parts of Asia] and it is not."

The current UAE system works like this: each foreign employee earns 21 days' pay for each full year of service for the first five years, and 30 days for each year of employment more than five years. The maximum gratuity is two full years' pay. However, the amount owed is slashed by two thirds if the employee leaves voluntarily before serving three full years, and by one third if an employee leaves before the end of five years.

If employees are made redundant, they qualify for the full gratuity.These rules only apply to foreign workers. Emirati workers are eligible for a Government pension.

These are the minimum requirements as established by the Government. Watson Wyatt recently surveyed more than 100 Gulf companies to see if many were offering enhanced gratuities or formal pensions to recruit and retain staff. Only 30 per cent were offering extra incentives.

"Up until now, cash has been king. The companies have said, 'We are paying you loads of money so you can go out and get your own pension'," says Iain Collins, a Dubai-based senior consultant at Watson Wyatt. "The overriding message was that most companies are simply providing what they are told to provide by the law."

Further, it is common practice for UAE companies to pay a modest base salary to an employee and increase the total compensation with add-ons such as utilities and housing, in part because the gratuity is based solely on the base salary. "Most companies structure their compensation to minimise that final payment," says Mr Collins.

Mr Collins says this is "slowly but surely changing" as companies adopt western-style standards of employee retention. The old model was created in the pre-financial crisis era, when employee turnover was much higher and companies mostly assumed a large portion of the workforce would be moving on in a year or two.

"The hot employees have churned and gone back [to their home countries]. We've got a different employee base than we did five years ago. Most of us are comfortable with a longer-term view now," says Mr Aka.

But as the gratuities get larger, it becomes more important that the money is somehow ring-fenced to ensure that it is available when needed.

The money could be allocated to a fund controlled by the Government or by individual companies. Employees are the obvious beneficiaries of either structure because their gratuities are protected, but the financial industry in the Gulf is also making the case that companies will benefit as well.

"Right now, to pay Dh100, you have to take Dh100 off the balance sheet. If you do it smartly, to pay 100, you only have to take 93 off. We can grow the money for him," says Mr Aka, whose firm administers and manages pension funds.

There are potential ancillary benefits as well. In most emerging markets, there are rules requiring that a certain percentage of the funds are invested within that country (in Oman, for example, only 20 per cent of pension assets can be invested outside the country).

In the UAE, that could provide a much-needed boost to liquidity in the markets. Also, bringing in executives to administer and manage the funds could aid the local financial sector. "You incubate the growth of an asset management industry," Mr Aka says.

At the moment, Bahrain is the only Gulf country with something like a pension plan for foreign workers. Mr Bussi, of the ILO, says the UAE "could set the standard" for Gulf countries if it enacts the proposals being discussed.

Most experts caution that a change in the law is not imminent, not least because most UAE companies are not having difficulty attracting skilled workers."It is still an attractive region to work, given what is going on elsewhere in the world," says Mr Collins.

Dubai property should revive 2011 and UAE to grow at 4.7% - Credit Suisse

Dubai’s real estate market is gradually stabilising and should begin to gain traction next year and thereafter on the back of improving domestic economic and financial conditions, according to a Credit Suisse study.

Dubai's troubles with its slumping property market and cash-strapped state-owned firms mean a longer road back to health, which is holding back overall GDP growth in 2010. Key sectors such as construction and real estate have in fact continued to undergo protracted adjustments. Demand for purchasing new homes remains weak as credit conditions are tight and rental prices are still falling, the bank said in its report ‘United Arab Emirates: 2011, the year of recovery’ as part of its latest Emerging Markets Quarterly, Q1, 2011.

That said, the real estate market is gradually stabilising and should begin to gain traction in 2011-2012 thanks to improving domestic economic and financial conditions. Meanwhile, exports have rebounded, providing a much-needed lift to growth this year, the report added.

Headway on debt restructuring and higher oil prices have been a boon for confidence. Dubai World struck a debt-restructuring deal with its creditors in September. The accord has helped to ease concerns over Dubai's debt crisis, boosting investor confidence, it noted.

The eventual resolution of the Dubai World saga should lead to greater improvements in banking and financial conditions by the end of 2010 and into 2011. As domestic conditions further stabilise and strengthen, we expect the economy to steadily build momentum. Indeed, activity in the private sector, which has lagged behind this year, should see greater gains in 2011 as deleveraging by businesses and households winds down, the report noted.

Additionally, it said strong public spending and investment, mainly financed by the oil-rich emirate of Abu Dhabi, would also continue to drive non-oil economic activity.

Abu Dhabi has launched its own industrial development with a port complex, the landmark Khalifa Industrial Zone Abu Dhabi (Kizad), which is a step forward in its longer-term objective of economic diversification. As such, we expect strengthening domestic conditions in 2011 to take up slack from a still soft external environment, driving an acceleration in non-oil GDP growth to 4.8 per cent from 2.4 per cent in 2010, it said.

The recovery in the UAE economy has proceeded slowly in 2010, with GDP growth rising just 2.3 per cent on the year, the report said while adding: “We see the UAE economy steadily building momentum in 2011, with GDP growth rising to 4.7 per cent.”

After a modest, albeit positive, contribution to overall economic growth in 2010, we expect growth in the oil sector to gradually pick up over the course of 2011, the report also noted.

Crude oil production has held relatively steady at around 2.3mn barrels per day during the first ten months of 2010, up 1.6% yoy. OPEC has kept a firm grip on production levels to support prices, but we expect output to rise as global demand again picks up by the end of next year. This underpins our projection for oil GDP to expand 4.5 per cent in 2011 after rising 2 per cent in 2010, it added.

Further, it said, the combination of rebounding oil and non-oil exports as well as relatively moderate import growth should boost external balances in 2010, in our view, and we expect additional gains in 2011.Strengthening external demand and higher oil prices have reignited export growth, which should raise the foreign trade surplus to 28.3 per cent of GDP in 2010. Accordingly, we expect the current account surplus to rise to 11.8 per cent of GDP this year, the report said.

The bank also expects UAE’s fiscal performance to continue to improve in 2011, as revenue collection benefits from higher oil prices and output and strengthening domestic economic activity.

We estimate that the fiscal balance turned positive in 2010, moving to a surplus of 2.2 per cent of GDP. We project a rise in the fiscal surplus to 4.4 per cent of GDP in 2011 under our baseline oil price assumption of $85/bbl. We expect government revenues to grow 16 per cent yoy in 2011, powered by both oil and non-oil revenues, the study said.

Further, it said although credit remains tight, the eventual resolution of the Dubai World saga should lead to greater improvements in lending conditions by 2011.

Private sector credit has continued to decline on a year-on-year basis, falling 2.4 per cent in August, but the pace of decline has eased in the past two months. Credit to the private sector certainly remains tight as banks have had to tighten lending criteria and boost provisions for non-performing loans (NPLs) to cover their exposure to cash-strapped local and regional firms like Dubai World. In addition, rising provisions for NPLs have continued to hold back lending growth. Nevertheless, the outlook has brightened thanks to the recent progress on Dubai World's debt restructuring. We think credit growth should accelerate to 9.4 per cent in 2011, the report said.

Consumer prices will likely continue to accelerate on a year-on-year basis through the end of 2010 and into 2011 in the UAE, as the pace of the recovery picks up, but inflation should remain moderate, the report added, while maintaining that there is no significant risk to the dirham's dollar peg at present.

It said although housing prices have already undergone their worst declines, soft demand and new supplies of both commercial office space and residential housing are contributing to continued weakness. We see inflation rising 4.5 per cent on an average annual basis in 2011 after edging up just 1 per cent on average in 2010

Private sector in UAE likely to see further pay cuts in 2011

The New Year may not be so happy or prosperous for those working in the country's private sector, recruitment experts have warned. Instead of pay freezes being thawed, employees working for private companies are likely to see further salary cuts, lower bonuses and less perks, they say.

The market, they claim, remains oversupplied with talent which can be hired cheaply compared with the heydays of 2007/08. Matthew Carter, Managing Director at McArthur Murray, sees the downward trend continuing to the next year as well. “I can only see the private sector reducing salaries as they believe that they can still hire people cheaply and that there is no problem in the supply of people,”  Emirates 24/7 report

“Existing staff still employed can expect a reduction in salary to be discussed in 2011 along with a reduction in quality of benefits, such as cheaper healthcare, cheaper flights etc. We expect bonus levels to drop as well,” he said adding that “the private sector is generally struggling still irrespective of the PR in the market. I can’t see the employers offering increases in 2011 to existing staff. Only in some very niche markets such as renewable, nuclear and possibly oil and gas can we see the trends being different.”

Commenting on the senior layer of employees, Konstantina Sakellariou, Partner, Marketing & Operations Director at Stanton Chase, said: "I would say that increases in remuneration are subject to overall performance of the company and not to general trends.

“If a company feels comfortable with revenues and their sustainability, then senior executives are going to receive an increase, either in the basic salary or in some of the allowances offered. Senior executives know from the beginning that they are not simple employees, waiting for a salary increase, but they contribute in making this happen,” she told this website.

But considering the current global economic scenario, hikes may not be expected, she added. “The international markets are not solid yet, so all companies are very cautious as per the increase of their expenses (including expenses in human capital). Companies will be making rational decisions for their expenses and will avoid the huge remunerations of the past that were not really paying back in productivity and profitability. This is indeed a way that most companies will choose for their operations in the next year(s),” she said.Of those who seem hopeful about any pay hikes, say things have mellowed down a lot and only rationality will prevail.

As per Lama Ataya, Chief Marketing Officer at Bayt.com, an online job search portal, employee satisfaction in the UAE is in the satisfactory range. “[We] gauge employee opinion and satisfaction levels vis-à-vis the salaries they receive, and how these have kept pace with the cost of living: 58 per cent of professionals in the UAE are ‘satisfied’ to ‘very satisfied’ with their current income.

"However, the total percentage of raise which professionals in the UAE stated they have earned in the past 12 months was 6.3 per cent compared to 10.6 per cent the year before. Hopes are high still vis-à-vis salary raise in the year to come with the average salary raise expected for year-ending 2010 being 11.6 per cent (indicating expectation that the effects of the financial crisis are finally waning). Moreover, as another barometer of consumer sentiment, 47 per cent of the UAE’s professionals surveyed expect their financial situation to be better in a year's time.”

Michael Al-Nassir, Partner and Head of Middle East, Africa and India at Pedersen and Partners, said: “The private sector is (and has to be) optimistic as is it driven by return on investment, and the shareholders and boards would like to see in 2011 a significant pick-up.”

Pregnancy tests for women workers under revised set of medical fitness rules in UAE

Pregnancy tests for women workers for some categories will be required under a revised set of medical fitness rules for granting work and residency permits to expatriates in the country, health officials announced.

The date for its enforcement will be decided in due course while the fee structure remains unchanged, they said.

Under the new federal rules aimed at benefitting public health, all maids, nannies and female drivers will be required to undergo pregnancy tests. In case of a pregnancy, it will be up to the sponsor to allow her to work or not. Only a category of professionals applying for new or renewal of visas will be tested for Hepatitis B and Syphilis. Under this category, those testing positive for Hepatitis, will not be given residency permit while those testing negative will be given mandatory vaccination and issued a certificate. Those with Syphilis will be given treatment locally. Expatriates from all other professions and their dependants applying for a new/renewing visa will only be tested for HIV, pulmonary TB and Leprosy. Those testing positive for these diseases will not be given residency permit.

Only six categories of workers including nannies, housemaids, nursery/kindergarten supervisors, beauty salon and health club workers, private drivers and food handlers in cafeterias and restaurants will be tested for Hepatitis B and Syphilis.

“The latest amendments are designed to eliminate any existing gaps as a result of the increased numbers of foreign labourers to work or reside in the UAE,” said the Minister of Health, Dr Hanif Hassan while announcing the new rules.

There is also a plan to increase the number of medical checkup centers.Rules for tuberculosis remain unchanged making old, new or active cases of pulmonary TB subject to deportation.

“In Dubai Health Authority, we isolate and treat such cases until completely cured before deporting them and providing them with one month’s medicine,” said Maisa Al Bustani, Head of the Medical Fitness Centre, DHA.

New labour rule will not end current Labour card validity

Private sector employees holding a valid three-year labour card will not be compelled to rectify or adjust their status when the recent ministry decision becomes effective, a senior official said.

Humaid bin Deemas, acting Director-General of Ministry of Labour (MoL) told that the recent ministry decision on cutting the labour card validity from three to two years would not affect the actual holders of valid labour cards.“Starting January 2011, only workers with expired cards will be obliged to renew by applying for the two-year labour card. New applicants will also fall under the new decision upon issuance of their labour cards. Actual holders of valid cards will keep them until their expiry. Moreover, from now till January, things will go on as usual as far as applying for the three-year labour card is concerned.”

Benefits of the new rule

The move to reduce the validity of the labour card to two years has come following a thorough study and analysis based on successful labour practices in other countries. “If you look elsewhere, like for example the Gulf countries, you will see that labour cards are usually issued with a validity of a year or two years maximum. The contractual relationship resulting from such a relatively short period has proved to pay off for both parties’ interests,” Humaid said.

The Labour Ministry’s senior official said it is a good and acceptable idea which enhances and regulates the movement and flexibility within the labour market. “In a recent survey we did, we found that about 70 per cent of employers have to cancel labour cards and cut short the employment of workers, who were originally hired for three years. The cancellation would come before a solid two-year period has passed. According to our statistics, employers would save more than Dh600 million annually.”

This would be rewarding to workers too as the new decision will help them feel more free and flexible to change their work if they are not satisfied. They won’t have to wait for three years before moving on to a new job.

Humaid shrugged off the possibility that the new decision would result in a rush of applicants at the service counters of the ministry.

“We have adequate procedures and a mechanism put into place to help implement new policies and decisions taken by the ministry. Discarding the paper work has been one advantage for a smooth processing of transactions. The e-system allows the employer to check on his establishment’s status and other data pertaining to his employees online and fill in applications likewise. Many other services are available online, including the follow-up on fines resulting from violation of the labour law.”

Meanwhile, a spokesman of the Abu Dhabi-based EMKE Group welcomed the decision saying it will streamline the manpower market as well as reduce the financial burden on local companies at a time when the global economies are facing tough times.

The spokesman said: “We also agree with the fact that some employees do not complete the full term of their employment, which is three years. So we have to make new recruitments and apply for new labour cards, visas, health insurances and other relevant paperwork. With this change in the law, the market is ought to streamline further.”

Hassan Mirza, owner of a transport company in Abu Dhabi, also welcomed the new decision to reduce the life of the labour card for all employees in the private sector as, he added, it will result in cost cutting for local companies.

He said: “We pay for our workers’ health insurance, labour card and residence permit. We have been paying fees for a period of three years for each worker. There were cases when our employees did not complete even one year with us, and the money for the two years goes in waste. It was a huge financial lose for us. The new law reduces the financial burden on companies that have more than 50 employees

Steep fine for landlords who don't register with Ejari

Tenancy Contract

New tenants are advised to stay clear of landlords or real estate agents who don't register the lease contract with the new Ejari system to avoid problems with utility connections should authorities enforce the new law in full

Registering tenancy contracts with Ejari, Dubai Land Department (DLD)'s new online portal, is a must under Law No 26 of 2007 which is aimed to regulate landlord-tenant relationships.

Under the Ejari system, made mandatory in March 2010, landlords must first secure Rera approval for their property before leasing it to an individual or turning it over to a property management company.

New tenants presenting a simple tenancy contract to Dewa still get a connection, but that could change. Landlords are obliged to pay the Dh160 Ejari registration fee at the end of the process and failure invites a fine of up to Dh50,000.

Landlords must upload the data for each leased property into the system. Once approved, the Ejari system will print out a new contract which will be the tenant's ticket to get utility connections

Online registration must for lease contracts: Rera

The Real Estate Regulatory Agency (Rera) has announced that from now on all rental/lease contracts for Dubai properties must be registered through its new Ejari online portal.

The announcement makes effective the provisions of Law No 26 of 2007 regulating the relationship between tenants and landlords in Dubai and requires all individuals and companies acting as landlords to register tenancy agreements.

Landlords and tenants who fail to comply with the new ruling will find that their tenancy agreements fall outside the protection offered by the law and government agencies and will not be able to enforce the provisions of the agreements they enter into.

The law clearly states: "Judicial bodies and governmental departments and authorities should not consider any claim, case or execution based on a tenancy contract unless the same is registered with the agency."

Announcing the new ruling and the full activation of Ejari, its state-of-the-art online registration system, Rera called on everyone involved in drawing up and entering into such contracts to ensure full compliance and avoid violation.

Registration through Ejari is a simple process requiring little technical knowledge and only the basic details of agreements are entered. These include information such as details of the property, the name of the rental company and terms of the agreement. Once the agreement is entered into the system and registered, it is allocated a unique barcode that acts as its reference throughout the life of the contract.

What is EJARI

EJARI means ‘My Rent’ in Arabic. But technically it means a revolutionary system that shall move Dubai real estate sector to be one of the best regulated rental market in the world.

EJARI is the new initiative of RERA to regulate and facilitate the Rental Market of Dubai. This is a new system that will make provisions of Law No. 26 of 2007 effective that is regulating the relationship between Landlords and Tenants in Dubai. This will require all individuals and companies acting as landlords to register tenancy agreements using EJARI.

RERA has announced that with the effect of 14 March 2010, all rental / lease contracts for Dubai properties must be registered through its new EJARI online portal. The EJARI electronic registration web service is designed to meet the requirements of the law and RERA’s vision and mission to establish a robust regulatory system for the rental market and protect the rights of everyone involved. .

Its state-of-the-art online registration system offers full protection of their rights to all parties with tenancy agreement. It ensures these rights are recognized, upheld, and enforced by all Government agencies. It establishes full transparency between landlord and tenant, fully integrates rental contracts into the legal framework and opens up the possibility of being able to revise these contracts seamlessly in the event of disputes .

The Ejari system provides a full portfolio of services beyond registering the initial lease agreement. Renewals, cancellations, transfers and terminations can all be logged. Ejari will ensure rental agreements are fair and transparent to the parties involved and that their terms and conditions are given full weight .

How it works?

Registration through Ejari is a simple process requiring little technical knowledge and that only the basic details of agreements are entered. These include information such as details of the property, the name of the rental company, and terms of the agreement. Once the agreement is entered into the system and registered it is allocated a unique barcode which acts as its reference throughout the life of the contract. RERA will keep its own record of the agreement and update changes to the register as these occur.

Abu Dhabi Issues Resolution No 64 2010 Regulations on Property Ownership

General Shaikh Mohammad Bin Zayed Al Nahyan, Abu Dhabi Crown Prince and Deputy Supreme Commander of the UAE Armed Forces, on Wednesday issued Resolution No. 64 of 2010 which aims to encourage real estate developers and investors in the emirate to register their real estate ownership and makes the process of transferring property ownership easier and faster, the official news agency WAM reported.

The resolution also aims to facilitate the process of acquiring loans to finance real estate investments. It specifies the framework and general rules related to property rights registration procedures.

Registration

The resolution stipulates that the director of the property registration department must register all dealings pertaining to the emirate's properties, or any property rights related to ownership, land development lease contract (Musataha) and long-term leases taking place both in and out of investment zones.

The director must also register mortgage contracts, and direct contracts concluded with banks and financing parties.

"It gives the purchase contract legitimacy and will help the buyers [get] access to finance and mortgage finance which is crucial to end-users. I’d love to see more openness in property regulations. I hope Abu Dhabi Finance will expand financing expatriate buyers," said Wael Tawil, chief executive of Baniyas Investment and Development Company (BID), which is developing the residential Bawabat Al Sharq project in Abu Dhabi.

Gurjit Singh, chief operating officer of Sorouh Real Estate, one of Abu Dhabi’s top real estate developers, said the resolution will help boost real estate development.

Confidence booster

"It's going to give a lot more confidence to the real estate market — to investors, property purchasers and developers," said Singh.

According to the resolution, real estate property ownership is limited to all Emiratis, and to people, companies and bodies who will be specified by a decision issued by the Abu Dhabi Executive Council.

Gulf Cooperation Council nationals and corporate bodies wholly owned by them are also allowed to own property as long as it is within the investment zones.

Non-Emiratis or corporate bodies will enjoy the right to own, buy, sell, rent, mortgage and invest in investment zones.

The registrar will also have to register these people and corporate bodies, who own apartments and storeyed buildings. The registrar will also issue title deeds to them after they have presented the necessary documents.

They may hold usufruct or Musataha right for up to 50 years (subject to renewal for a similar duration) and usufruct contract for up to 99 years and long-term tenancy contract in properties located in investment areas.

The registrar will register non-Emiratis or corporate bodies in the real estate registry as owners of these rights, after they have presented the necessary official documents specified in the regulations and laws issued by the director of the municipal affairs department

Ahmed Shaikhani, managing director of Memon Investments, a Dubai based property developer, welcomed the move which would boost market confidence. He said it would also encourage new projects by the developers as a law has been issued on the property registration. At a time when new investments into the real estate sector have slowed down a bit, this development would be helpful in attracting investors’ attention, he said.

Shaikhani said properties were already being registered in the emirate. Now those transactions have got a legal cover, he said.

Investors purchase freehold property in Dubai through offshore company now need to set up an offshore firm with Jebel Ali Free Zone (Jafza).

Investors looking to purchase a freehold property in Dubai through a company now need to set up an offshore firm with Jebel Ali Free Zone (Jafza). Titles to freehold properties will not be registered unless a no-objection certificate (NoC) is procured from the free zone.

This follows the signing of a recent deal between the Dubai Land Department (DLD) and the free zone in a bid to maintain a more concise register of land and property transactions. This new policy, however, does not affect the ownership of properties registered in the name of local entities that were issued title deeds prior to October 26, 2010.

Improving transparency

According to Michael Lunjevich, partner and head of real estate at law firm Hadef & Partners, "It's for the Land Department to have some visibility on who the shareholders and directors are in an offshore company. It's very important to know who the beneficial owners are, and the transfer of property shouldn't be allowed off the Register."

While offshore companies were popular among expatriates, particularly the Muslim community, in Dubai owing to uncertainty over inheritance issues in the region, those established in offshore jurisdictions such as the British Virgin Islands (BVI), the Isle of Man and the Cayman Islands also legally avoid having to pay certain types of taxation on profits and income. "Some international investors don't want assets in their personal name since they could get sued internationally for assets you own in a different country. Transferring it from your name will minimise that risk," explains Brent Baldwin, associate at the law firm.

Despite the fact that the Jafza deal is expected to emphasise information access to shareholder details, investors can still ensure that the asset cannot be traced to their name.

"You may still have situations where the Jafza company is owned by an offshore trust or a nominee company. If you structure your investments well, you can ensure that nothing traces back to you. But, it will be more difficult to sell the structure onto someone else. You will have to transfer two companies and many companies may not be willing to take up collective liabilities," suggests Lunjevich.

Stringent reporting norms

Industry experts believe the DLD could make the reporting requirements for existing foreign offshore firms more stringent. "They might introduce more stringent reporting requirements on those grandfather acquisitions. The Land Department may sometimes enable free transition from a foreign offshore company to a local offshore firm, without charging a fee," Lunjevich says.

The nature of offshore firms not needing to disclose details of the beneficiary has lent itself to fraud and money laundering in many instances. "There have been examples where offshore companies, mostly BVIs, collected money for developments, did not put it into an escrow account and the directors disappeared. Whether it was done fraudulently or they were victims of circumstances, I wouldn't want to speculate," Lunjevich adds.

Residency departments will not renew the residence visas of expatriates if they are wanted by police for financial obligations

Residency departments will not renew the residence visas of expatriates if they are wanted by police for financial obligations, Interior Ministry officials said

Residency departments will not renew the residence visas of expatriates if they are wanted by police for financial obligations, Interior Ministry officials said.Residency visas of expatriates, their relatives and their employees will be renewed only after the settlement of the financial disputes.

Several residents told  that their applications to renew their visas were rejected because banks had lodged complaints against them with police, who had issued arrest warrants.Police have instructed residency departments to arrest these expatriates or send them to the authorities.

While this is the rule, Interior Ministry officials said they consider some cases on humanitarian grounds.

Lawyers, however, stressed that the police have no right to ask residency departments to arrest people who have defaulted on bank loans or other financial issues.Residency departments, lawyers said, are administrative units and have no right to arrest or punish people by not renewing their residence visas for such matters.

Major-General Nasser Al Awadi Al Menhali, Assistant Undersecretary in the Ministry of Interior for Naturalisation, Residency and Borders, told  that if banks file a case with police against a person for financial issues, such as delayed payments of loans or bounced cheques and an arrest warrant is out, no transaction is carried out for that person.

He said residency departments do make exceptions.

“We look at the case on humanitarian grounds. We renew the residency visa if the person has a family, wife and children,” he said. “The ministry does not want to increase the number of illegal residents. The residency department does not arrest people if they are involved in bank loans but we ask them to sort the matter out.”

Dr Khalifa Rashid Al Sha’ali, a lawyer and legal expert, told  that when police ask to bar a person from getting his visa, it is meant to pressure him into paying his dues and protect the other party’s rights.‘Illegal pressure’.However, Dr Al Sha’ali said not renewing the person’s residency visa is a kind of punishment or pressure that is illegal and unjustified.

“It is illegal if the residency department does not renew someone’s residence visa if they do not pay their bank loans. There is no article in the law which says residency will not be renewed for not paying banks, for example,” he said.

A businessman told  that this step by the residency department is illogical.

“It punishes the company for an issue that involves the employee. The loan defaulter in turn is punished using a different tool and is made illegal.”