Business rules under Sharia law in the UAE

Businessmen and investors operating in the Middle Eastern region should familiarize themselves in advance with the rules of conducting business in accordance with Sharia law in the UAE. This will not only help avoid many awkward situations but also positively impact negotiations, contract agreements, and, consequently, the overall development of the company.

Nuances of doing business in the UAE

The United Arab Emirates is a country with a rapidly growing economy, progressive infrastructure projects, and a high standard of living. However, for successful business operations in the UAE, it is necessary to consider the peculiarities of the local culture, legislation, and religion.

The United Arab Emirates traditionally adheres to Sharia law – a system of rules based on religious principles and moral values of Islam. Sharia serves as the basis for regulating all aspects of citizens' lives in the UAE, including business. The rules governing business conduct differ from Western models and require appropriate understanding and adaptation.

One of the peculiarities is the requirement to observe ethical norms and principles. Business activities must be honest and transparent, without corruption or fraud. It is also advisable to avoid investments in companies associated with alcohol, pork, or other products prohibited by law.

Entrepreneurs should consider the religious holidays, prayer times, and other religious traditions of their employees. Care should be taken when conducting marketing campaigns to ensure they do not violate Sharia rules or offend the religious sentiments of Muslims.

In the UAE, strict laws regulate labor relations, including minimum wages, working hours, and working conditions. Entrepreneurs should be prepared to comply with these norms.

Features of Business Negotiations

Business negotiations often play a key role in successful deals. The process significantly differs from the Western model.

The first thing foreign partners should do is to be patient. Negotiations in the UAE can last for several weeks. This does not mean that Arab partners deliberately prolong the process. On the contrary, they try to understand their counterparts as best as possible. Potential partners are often invited for meetings, engaging in conversations about family and hobbies.

Some stages of the negotiation process resemble informal gatherings over a cup of coffee. However, such a somewhat informal approach does not mean that one can be late for negotiations or not notify in advance about their visit. Business etiquette is still important.

During negotiations, Arabs often joke, showing a positive attitude and friendliness. They appreciate a sense of humor in their interlocutors. However, this should not offend their national dignity or religion. Any signs of impatience or greed are perceived by locals as disrespect.

Another feature of negotiations with Arab partners is the art of oratory. Local residents are more willing to work with someone who can articulate their ideas without relying on colorful presentations, interactive slides, or tables. Expressive communication has always been valued in the East. Therefore, when residents of Dubai or Abu Dhabi observe such abilities in potential partners, it creates a positive impression on them.

Features of Appearance

Both Western and Eastern styles of clothing are acceptable. The main thing is compliance with climatic conditions and Sharia norms. Foreigners attending negotiations are often dressed in classic suits of light shades. The use of natural breathable fabrics such as linen and cotton is permitted.

Arab business representatives often wear a kandura. It is a white, long-cut tunic, traditional attire for Muslim men not only in the UAE but also in Palestine, Syria, and Lebanon. However, it is not recommended for foreigners of other religions to wear a kandura as it may be perceived as disrespectful.

Women can dress in loose dresses or business suits, but without revealing necklines or cleavage. Mini dresses are also not suitable as they contradict Sharia rules.

Communication Features

Successful business conduct in the UAE is impossible without a clear understanding of the peculiarities of local communication. When communicating with partners or clients, it is necessary to demonstrate sincere respect.

Handshakes are considered a common greeting in the UAE. The older or higher-status person is usually greeted first. Handshakes with women are extremely rare due to religious reasons, as Islam prohibits touching women who are not relatives.

During gatherings, Arabs do not consume alcohol, so it is not appropriate to request wine, champagne, or pork dishes, especially since most restaurants do not serve them.

When visiting a partner's home, it is acceptable to present them with a small gift. Generosity is valued in the United Arab Emirates, but it should not appear as extravagance.

Language Barrier

The official language of the country is Arabic, so its knowledge often plays a decisive role in successful communication and establishing business relationships.

Fluency in Arabic helps establish trust and demonstrate respect for local culture and traditions. Knowledge of the language can be useful when concluding contracts and conducting legal procedures such as company registration, opening a bank account, obtaining a visa, or a license.

The consulting company The Level Consulting will help register a company in the UAE, open a bank account, rent office space, or conduct business negotiations. The team of experts at The Level Consulting will provide all the necessary support and take on solving complex organizational and legal issues.

Even if you do not know Arabic, it is worth learning a few greeting phrases that will demonstrate friendliness and respect towards clients and partners, such as "assalamu alaikum" or "wa alaikum assalam."

Opportunities for Companies Operating in the Gulf Region

Adherence to Sharia law in conducting economic activities in the UAE provides access to the vast market of the Middle East region, thereby opening up new opportunities for expanding companies.

Most Gulf countries actively develop their infrastructure, creating conditions for successful business development.

States located in this region actively attract foreign investments, establishing special economic zones and providing various incentives for businesses, making them even more attractive for entrepreneurs.

Adhering to the rules of conducting business in accordance with Sharia norms will help create a positive impression of the company and enhance its reputation in the UAE.