Business

Swiss chocolate maker Lindt & Sprungli makes home in Dubai

A growing number of multinationals are coming to Dubai seeking to serve their clients better and break new grounds for growth.

Wam

April 13, 2014

  • English
  • Arabic

Dubai FDI, the investment development agency in the Department of Economic Development has assisted one more multinational move to Dubai for broader market access and expansion with Lindt & Sprungli, the famous Swiss manufacturer of premium chocolates, establishing its representative office in the emirate.

Fahad Al Gergawi, the chief executive, commented, “Lindt & Sprungli moving to Dubai has varied implications for the company as well as for the emirate and its vast catchment that includes Middle East, Africa and the subcontinent. It underlines the significance of Dubai as a supply chain hub in the region and a magnet for investors across varied geographies.”

Mr Al Gergawi said that a growing number of multinationals are coming to Dubai seeking to serve their clients better and break new grounds for growth as a diversity of businesses sectors, new opportunities, ease of doing business, connectivity and varied lifestyle choices, continue to keep Dubai as a preferred destination for businesses and individuals.

He added that the positive sentiment Dubai has reinforced as the host city of the Expo 2020 will bring in more high-profile investors like Lindt & Sprungli on the longer term.

“Over the past three years Dubai FDI has assisted nearly 470 companies, from varied sectors, to set up in Dubai. The net investment brought in by these firms is around Dh9.56 billion. The Expo would not only create new demand but also attract investments through introducing the advantages of doing business in Dubai to a large international audience,” Mr Al Gergawi remarked.

“Being based in Dubai allows us to reach all of the parts of our large territory, and one of the main factors in our choice of location was the exceptional communications infrastructure that Dubai provides. With the support of Dubai FDI, and the help of our partner, CBS, we were able to incorporate our Dubai branch effortlessly,” said Graeme Bradstock, the head of region at Chocoladefabriken Lindt & Sprungli.

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- Abdullah Ishnaneh, Partner, BSA Law 

Ten tax points to be aware of in 2026

1. Domestic VAT refund amendments: request your refund within five years

If a business does not apply for the refund on time, they lose their credit.

2. E-invoicing in the UAE

Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption. 

3. More tax audits

Tax authorities are increasingly using data already available across multiple filings to identify audit risks. 

4. More beneficial VAT and excise tax penalty regime

Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.

5. Greater emphasis on statutory audit

There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.

6. Further transfer pricing enforcement

Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes. 

7. Limited time periods for audits

Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion. 

8. Pillar 2 implementation 

Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.

9. Reduced compliance obligations for imported goods and services

Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations. 

10. Substance and CbC reporting focus

Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity. 

Contributed by Thomas Vanhee and Hend Rashwan, Aurifer

Our legal consultant

Name: Hassan Mohsen Elhais

Position: legal consultant with Al Rowaad Advocates and Legal Consultants

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