The Russian economy is actively reoriented to the East; this direction is becoming increasingly strategically significant and important.
Many entrepreneurs see the United Arab Emirates as an area of new opportunities for business expansion and investment. However, before deciding to cooperate with a company from the UAE, it is necessary to conduct a thorough check to ensure the reliability and legality of the partner’s activities.
The UAE is actively developing cooperation with Russia, including not only economic ties, but also interaction in strategically important areas such as high technology and energy.
In 2023, trade turnover between Russia and the UAE reached $10.2 billion in comparison to $9 billion in 2022. Russian export increased by 12.7% and reached $9.8 billion, import increased by 50.8% and reached $400 million.
On January 1, 2024, the UAE officially became a member of BRICS, which further strengthens economic cooperation between our countries.
Due diligence when checking a UAE company
Cooperation with an unfair counterparty can lead not only to financial losses, but also to damage to the reputation of your company. This is especially dangerous in conditions of active entry into new international markets.
When checking a counterparty from the United Arab Emirates, it is important to carefully study all aspects and comply with the requirements of the legislation of the Russian Federation. Let's take a look at the key ones:
1. Collection of general information
Registration data and licenses: obtaining information about the legal status of the company, UAE tax registration number (when registering an organization, a unique 15-digit code is issued) and registration date. It is also necessary to check the availability of a license. Companies in the UAE cannot conduct any activity without a license.
Contact details: checking the relevance of the address, telephone and email.
There are more than 40 free economic zones (FEZ) in the UAE, offering attractive conditions for investors, including low taxes, no customs duties and a high level of confidentiality. To conduct business, companies are required to obtain an appropriate license, which may be related to trade, production, services or e-commerce. As a rule, the license period is 12 months with the possibility of annual renewal.
Each FEZ maintains its own register of residents, access to which may be limited. Companies are not required to disclose their financial statements, which creates additional difficulties when checking counterparties.
Common forms of organizations include:
- FZE (Free Zone Entity or Free Zone Establishment) – legal entity with one shareholder;
- FZC or FZCO (Free Zone Company) – legal entity with the number of founders from one to fifty.
2. Financial condition
The financial stability of the company lies in the absence of debt to the budget and other counterparties. When checking, it is necessary to determine the presence of lawsuits and claims, cases of administrative, subsidiary or criminal liability, arrest of property and tax debts.
To reduce the risks linked to cooperation with an unreliable counterparty, it is worth requiring your partner for constituent documents, which indicate the details of the company’s shareholders, as well as a certified list of shareholders.
3. Assessing information about beneficiaries
It is not possible to verify this data through publicly available online sources. To clarify the data of shareholders and management companies, it is necessary to contact the official UAE government authorities or relevant agencies.
4. Goodwill and history
To obtain the maximum amount of information, it is recommended to turn to feedbacks from real partners of the company and study the recommendations of clients and counterparties. This will help you get a complete picture of its goodwill and reliability.
If a company has had litigation or been involved in negative activities, this information will highly likely be found in local news and information sources. Studying these sources will help you learn about problems or incidents related to that company.
Minimizing the risks of cooperation with UAE companies with Globas
Conducting an independent audit of a UAE counterparty is a complex procedure that requires attention, time and a good understanding of the law. To achieve maximum results, it is recommended to involve specialists with relevant skills and experience.
The Information agency Credinform and the Information and Analytical system Globas will help solve the problems of due diligence when checking international business partners, including those from the UAE. Credinform is a leading provider of economic information on companies from around the world.
In Globas you can obtain online information about companies in Belarus, Kazakhstan, Kyrgyzstan, Latvia, Moldova, Tajikistan, as well as generate a report on over 489 million companies from Europe, America, Africa and the Asia-Pacific region. This report will include information on registration, financial statements, shareholders, beneficiaries and all the basic information necessary to make an informed decision.
For a more detailed and thorough check, you can order an offline report. Your request will be processed by a team of skilled experts with extensive experience and specialization in the field. You will receive comprehensive information, including registration data, financial statements, ownership structure taking into account international connections, expert assessment, as well as check of links and affiliations with Russian companies.
Globas
Credit reports on foreign companies
Thanks to a wide network of partners, Credinform provides information about legal entities and entrepreneurs around the world on all continents: from multinational corporations to offshore companies and individual entrepreneurs. To verify the solvency of the company, to identify the owners or to check the fact of registration in an offshore zone – our experts will provide comprehensive information and a competent resume.
