Country Risks
The UAE does not have the capability to defend itself from a major military conflicts. However, UAE participates in the anti-Islamic State Coalition, making it a target for potential terrorism attacks. Due to there participation in this Coalition, it becomes an ally of the United States. The US would come to the Aid of UAE in a military conflict which makes the risk of war relatively low.
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Also, with its current political status, it is unlikely for the country to undergo any major regime changes in the coming years. This should create some confidence in investing in the country.
Political Risks
Legal Risks
There are a few legal risks associated with doing business in the United Arab emirates. Some of the risks are due to the three legal entities: federal, emirate, and sharia. Foreign Investors can only own land in certain regions or maintain only partial ownership in others. Currently there is not federal tax on corporations. Some of the emirates have a taxes on corporations however the risks of the federal government changing tax policies at this time is relatively low.
Foreign arbitral awards are rarely enforceable, and foreign creditors are likely to be at considerable legal disadvantage in the event of disputes or corporate insolvency.
