Dubai Opens for Digital Business
Dubai announces new virtual business license to attract a new global class of digital entrepreneurs.
By Xische Editorial, October 14, 2019
Source: Rashad Ashur/Shutterstock
With the proliferation of smartphones and communication platforms like Slack, companies around the world are going remote. The traditional definition of the workplace is out the window. We are so digitally connected that the need for physical connections in an office setting is dwindling as fast as paper telephone books. This is a boon for business, workers, and countries, but only if its power is handled in the appropriate manner.
Consider business owners. Imagine the ability to hire the best person for the job, no matter where they are in the world. Freed from the burden of organizing residency visas and jumping over other bureaucratic hurdles, companies can focus on getting down to business. Given the amount of time we all spend online, having a remote office is actually not that much different from our current working environments anyway.
Workers also benefit. They can work from wherever they choose while shopping their skills to the best employer or the best deal. This is a complete rethink of the business models that built the middle classes in the United States and Europe. But we are living in a time in which a new global middle class is emerging, and in places far outside the borders of the West. Disruption is welcome here.
The next logical step in this transformation concerns the role of government. Countries or cities that have made technology a key driver of their economy have the unique opportunity to virtually host the next generation of startups. The ultimate remote office has no physical location, but it does have to be registered somewhere. Thus, the registration of digital or virtual companies is critical for future knowledge economies.
Last month, Dubai announced that it was taking a major step towards the creation of virtual companies in the Emirate. As part of its commitment to building Dubai into the Silicon Valley of the Middle East, the Government introduced a “virtual company licence” designed to help freelancers and small companies gain access to Dubai’s technology ecosystem. The new license will attract the best talent to Dubai’s innovation ecosystem and maintain the Emirate’s high level of technology infrastructure.
The decision is not without precedent. For years, Estonia has offered similar e-business and residency programmes. The tiny Baltic country launched the world’s first e-Residency programme in 2014 with the goal of 10 million e-residents by 2025. Building on Estonia’s established digital economy, e-Residency allows entrepreneurs from around the world to set up digital business in the country without the need to be physically present.
Dubai’s announcement is similar to Estonia’s direction but not exactly the same. Eventually, digital entrepreneurs will be able to run a business from anywhere in the world with registration in Dubai. From freelancers to established entrepreneurs and digital nomads, this programme will offer the best of Dubai’s technology ecosystem without the need to be physically present.
According to Gulf News, the Virtual Company Licence is a joint initiative of Dubai Economy, Dubai International Financial Centre (DIFC), General Directorate of Residency and Foreigners’ Affairs (GDRFA), Smart Dubai, and the Supreme Legislation Committee. It will focus on three main sectors: creative industries, technology and services.
Announcing the virtual company license, Director General of Dubai Economy Sami Al Qamzi told reporters “the Virtual Company Licence is a testament to our commitment to eliminating barriers for the private sector, which is a strategic partner in sustainable development. The public and private sectors are integral to Dubai’s diversified economy and the Virtual Commercial City will further strengthen public-private partnerships in enhancing Dubai’s profile as a global business and investment destination.”
When we reported on the success of the Estonia e-Residency programme earlier this year, we ended the piece with a thought about the ingredients knowledge economies require in order to thrive in a rapidly changing global market. “Knowledge economies need people to thrive, grow, and innovate but those people don’t all need to be located in one geographic space,” we wrote at the time. “Estonia’s approach to value creation by constructing a knowledge economy recognizes this fact. By investing in the right infrastructure at home, the country has created a digital platform that knows no boundaries. As other countries move to adapt this model, we will come to understand just how ahead of its time Estonia is. The future is now.”
These words still ring true and Dubai’s fresh approach to building its own knowledge economy is proof that ideas are being put into action. The virtual company license will bring with it a fresh influx of talent. While many people won’t physically be present full-time in Dubai, their skills will be woven into the DNA of the Emirate. As we have seen with Dubai’s startup unicorns like souq.com and Careem, talent begets more talent.
In the borderless world that we are driving towards, Dubai is ensuring that the best and the brightest have a connection to the UAE’s technology sector. The Emirate has swung its doors open to the world and demonstrated it’s ready to do business. Several decades from now, we will be able to look back and pinpoint the early fundamentals that established the UAE’s vibrant knowledge enterprise. The issuance of these humble visas to digital entrepreneurs and nomads will surely be a highlight.
