Dubai
has made major efforts to establish itself as
an e-commerce hub, and according to a study
carried out by Dubai Media City-based Madar
Research Group in late 2002 was at that time
on a par with top European Union states in basic
online services.
Dubai
scored 76 points out of 100 in the benchmark
test that measures the services' online availability
and the level of that availability - whether
a service could be fully completed and transacted
through the Internet. The test covered 19 public
services - nine for businesses and 10 for individual
users - which were considered most essential,
or are most commonly used by companies and the
general public in Dubai.
Services
related to visa and driver's license applications,
birth and marriage certificates, job search,
utility payments, as well as registration of
new companies, municipality permits and fees,
customs declaration and other basic services.
"Dubai
Government has made significant progress in
2002 in migrating its basic services, especially
those offered to businesses, on the Internet,"
said Abdul Kader Kamli, president and research
director.
"The
benchmark test gave Dubai an overall score similar
to that of the UK, which ranks fourth in the
European Union in terms of the online availability
of basic public services," Kamli added.
The
study was based on a benchmark test standardised
by the European Commission to gauge the comparative
progress of e-services development in EU member
countries. Madar Research followed the same
methodology but used localised test criteria.
Speaking
at the ninth GCC e-Government, Telecom and Internet
Forum in May, 2003, Information Systems Professor
Dr George K. Kostopoulos said that Dubai was
a regional leader in the e-government project
and was on the right track.
Outlining
areas which needed to be improved, he cited
transition management skills, new balance of
power, cadre creation, need for IT professionals,
training of civil servants, cyber issues, computer
literacy and Internet access.
"The
e-government project is an agent for change.
It helps melting of government rigidity and
increases decision-making transparency.
"The
UAE is a regional leader in e-government. Dubai
is a regional consultant in e-government. It
has 24 departments online, online resident permit
and visa renewal, e-gate at Dubai International
Airport, e-traffic advisory, e-dirham for payments
and an outstanding information portal."
In
January 2007, Dubai International Financial
Centre announced that it had issued an enhanced
Data Protection Law and appointed a Data Protection
Commissioner to oversee its administration by
the DIFC Authority. Both moves were designed
to consolidate international best practices
already being adhered to by the DIFC.
The
Data Protection Law, ensures the protection
of all personal information, including any sensitive
personal data, and is compliant with the provisions
of the laws and directives of the European Union
and the guidelines of the Organisation for Economic
Co-operation and Development (OECD), including
on the transfer of data.
Commenting
on the new law, Omar Bin Sulaiman, Governor
of the DIFC noted that: "in our era of
globalisation, when information has never been
more readily available and transmittable, it
is crucial to establish effective data protection
regimes and enforce legal safeguards against
the misuse of personal data. At the DIFC, we
are committed to upholding and continuously
improving upon the highest standards in this
regard.”
Dubai
Internet City
In
February 2000, Dubai's then ruler Sheikh Maktoum
bin Rashid al-Maktoum issued a decree setting
up a free-trade zone for electronic commerce
and technology.
The
decree established an independent body, the
free zone authority headed by Crown Prince
Sheikh Mohammed bin Rashid al-Maktoum, which
would operate under the Dubai government to
spearhead the emirate's drive to become a
regional centre for electronic commerce, technology
and information.
"Among
the objectives of the free zone, as outlined
by the law, is to draft strategies and policies
to make Dubai a centre for technology and
electronic commerce,' said an announcement.
For
the full text of the decree, see "Dubai
Technology, Electronic Commerce and Media
Free Zone Law No. (1) of 2000".
The
free zone authority oversees the establishment
of the necessary infrastructure at the zone,
licenses companies wishing to set up shop
there and leases land and property to them
for up to 50 years. The authority also runs
the zone, and levies fees for its services.
Companies are allowed 100 per cent foreign
ownership in the zone. Goods imported to the
zone and products for export are exempt from
custom duties and companies are exempt from
taxes, including income tax.
Companies
can choose to incorporate in one of three
ways:
-
Branch
of Foreign Company;
-
Branch
of UAE-based Company (including other
UAE Free Zone licensees);
-
Free
Zone Limited Liability Company (FZ LLC).
Submission
of the License application form can be done
electronically through the Dubai Internet
City site.
The
physical location of the Internet City is
on Sheikh Zayed Road, next to the American
University. DIC highlights include:
- World
class technical infrastructure: high bandwidth,
low cost telecom infrastructure and secure,
high speed support infrastructure;
- State-of-the-art
urban infrastructure: cost competitive,
flexible office space and world class housing,
medical and education facilities;
- Access
to talent pool: large pool of high skill,
low cost knowledge workers;
- Straight-forward
laws and regulations: easy and fast company
registration laws, hassle-free immigration
process and straight forward legal procedures;
- Supportive
environment: Government backed e-business
initiatives, business incubators, venture
capital funds and e-education programs;
- Gateway
to markets: access to regional markets in
Middle East, North Africa, Indian Subcontinent
and CIS.
In
September 2000 Dubai officials announced
that more than a hundred information technology
companies had been granted licences to operate
in the City. The companies, which included
industry giants Microsoft, Oracle and Compaq,
were investing USD250 million in the technology,
e-commerce and media free zone, DIC director-general
Mohammed al-Gergawi said at a press conference.
Another 350 firms were awaiting approval,
he said. By mid-2004, the number of companies
operating out of the DIC had risen to more
than 500. This number had risen to almost
1,000 by October 2007, when the DIC notched
up its seventh-year of operation.
A
further 112 companies chose to locate thier
operations in the DIC in 2007, representing
33% annual growth. The new entrants include
global companies such as British Telecom,
Qualcomm, Google, Layton International,
Telecom New Zealand, Dimension Data, Logo
Business Solutions and VeriSign, top-tier
names in the ICT sector.
The
DIC's 2005-2006 Partner Profiles 2005-2006
directory, meanwhile revealed that there were
then over 700 companies, from across the ICT
industry spectrum, operating out of the City.
Celebrating
its fifth anniversary in 2005, the DIC authorities
revealed that as part of the Internet City's
'Going Global' mission, they were in talks
with authorities in India, Pakistan, Iran
and Malta to set up facilities in various
cities.
To
complete Dubai's aim to become the super e-commerce
hub in the Middle East region, Dubai's cyber
laws - more formally known as the E-Commerce
Facilitation Laws - were passed at the end
of 2001. The
Electronic Transactions and Commerce Law No.2
was additionally passed in 2002.
In
June, 2004, Dubai Internet City announced
the Dubai Outsource Zone (DOZ), the world’s
first ’free zone’ dedicated to the
outsourcing industry. The announcement was
made by Dr. Omar Bin Sulaiman, CEO of Dubai
Internet City at Europe’s biggest conference
on outsourcing, Outsource World held in London.
Dubai
Outsource Zone provides a comprehensive infrastructure
and environment for outsourcing companies
to set up global or regional hubs servicing
the worldwide market. DOZ’s offering
includes 100% exemption from taxes, arguably
the world’s most reliable technology
and communications infrastructure, a one-stop
shop of support services and the best possible
working environment.
Dubai
Outsource Zone provides a base for companies
wishing to provide mid- to high-end IT and
business process outsourcing (BPO) services.
Some of the key sectors targeted include finance,
accounting, IT, payroll processing, healthcare,
insurance, engineering, biotech, multimedia,
R&D and design. DOZ also serves as a centre
for disaster recovery facilities for call
centres located offshore elsewhere in the
world. The Zone offers facilities both to
‘captive’ BPO operations, ie. companies
who have their own offshore BPO facilities,
and to third-party BPO service providers,
from Europe, the US, the Middle East, Asia
and Africa.
“Having
established vigorous growth in the ICT industry,
we are now seeking to transfer that momentum
to new high-growth sectors like Outsourcing,”
said Dr. Omar Bin Sulaiman, CEO of Dubai Internet
City. “We had been studying the outsourcing
sector for a long time to design the perfect
combination of services that will provide
value to the global and regional outsourcing
industry. At the heart of the Dubai Outsource
Zone concept is a commitment to offer relevant
facilities to global companies to enable them
to create an effective globally distributed
delivery model. DOZ will go a long way in
strengthening Dubai’s status as a knowledge-economy
hub,” he added.
“The
establishment of DOZ and the expected growth
of the outsourcing industry will bring in
several economic benefits for the UAE and
the region,” said Dr. Bin Sulaiman. In
the UAE alone, apart from the infusion of
talent from other countries, it will to provide
a significant boost to the development of
the country’s own human capital. The
industry promises several opportunities for
fresh graduates to gain valuable exposure
in various emerging sectors of the economy
through both full-time and part-time employment
opportunities,” he concluded.
BACK
TO TOP
Dubai
Internet
Activities
Whether
or not because of the rapid construction of
the Internet City, many Internet and e-commerce
applications have appeared rapidly in Dubai
in recent years. Some examples are as follows:
-
Magrudy's Bookshop, a subsidiary of Magrudy
Enterprises L.L.C., was the first book shop
in the Middle East to provide secure e-commerce
services to a global market over the Internet.
-
Emirates Bank Group announced that it would
be the first Bank to open a branch at the
Dubai Internet City. The Branch offers all
the traditional banking services to the
major corporations that have located in
the City, as well as offering its portfolio
of existing and upcoming electronic banking
facilities.
- Dublin
based Misys International Banking Solutions
announced in November 2001 that it would
be providing online banking solutions to
one of Dubai's leading online financial
services providers. CashSwitch confirmed
that it had licensed the solution to make
internet banking more accessible for customers
and more cost effective for banks throughout
the Gulf region, and revealed that as a
result of the new alliance, it will be able
to act as an Application Solution Provider
(ASP), or to directly license Misys' Fontis
iBanking platform to Middle Eastern banks.
The package offered by Misys aims to allow
banks in the offshore financial centre and
throughout the region to offer customers
improved online facilities, including account
management, transaction enquiries, and secure
fund transfers.
-
The European Union's imposition of VAT (Value
Added Tax) on transactions conducted over
the internet in July, 2003, led web hosting
firm Emirates Internet and Multimedia to
attract firms from within the UAE to use
its online services. "Many companies throughout
the region have traditionally hosted overseas,
in the US or Europe," said Maroua Naim,
general manager. "Besides the obvious problems
this creates due to time and physical boundaries
that hamper effective technical support,
the additional VAT charges of hosting abroad
are also becoming a concern," he observed.
All firms participating in the programme
are supplied with free registration on the
'.ae' domain for the duration of a year.
- In
late January 2006, it emerged that chip-maker,
Intel had signed an agreement to move its
Dubai offices to the DIC. “Intel is
moving its offices to Dubai Internet City
because it offers a strategic platform to
tap new opportunities in this fast-growing
market,' explained Gordon Graylish, Intel
Vice President of the Sales and Marketing
Group, and General Manager for Europe, the
Middle East and Africa (EMEA), adding that:
“This will help our Dubai team to
be closer to many of our fellow travelers
in the region as we continue to work with
them to develop our business and play a
role in growing the IT sector here”.
- In
May 2008, Verizon Business announced plans
to open an office in Dubai Internet City
to further strengthen the company’s
service and support capabilities across
the Middle East.The office will provide
a base for the company’s ongoing regional
expansion plans.
The
Dubai Government itself has been very active
in encouraging e-commerce, and announced in
early 2002 that its e-Government initiative
would broaden its focus in order to take in
expatriates from the United Arab Emirates
placed overseas, and students from the region
studying abroad.
Speaking
at a presentation for UAE students studying
at Bahrain University, Salem Al Shair, the
e-Government initiative's Director of e-Services
explained the rationale behind the new drive
for expatriates. "Young national students
who are residing overseas often need important
information, legal documents or urgent government
assistance from their home country. By offering
integrated e-services through the portal...Dubai
e-Government is opening a 24 hour communication
channel that will facilitate the lives of
students [and expatriates]."
The
Dubai e-Government portal currently offers
a wide range of services for visitors, residents,
and businesses, including access to permit
and visa renewal services, commerce and business
related facilities, and company registration
and tax department links.
In
March 2005, global logistics firm DHL announced
a joint venture with the Dubai customs authorities
that would see the creation of an electronic
customs clearance system designed to streamline
procedures and improve general business efficiency
in the United Arab Emirates and beyond.
The
e-clearance project resulted in the complete
digitisation of all customs clearance procedures
which, according to UAE Customs and Gateway
Manager Derek Tully, speaking at the time
of the launch, was intended to reduce shipment
transit times by up to 24 hours.
“By
implementing this new procedure, DHL UAE is
helping Dubai increase its customs efficiency
which will, as a direct knock on effect, increase
productivity for regional businesses and customers,”
observed Mr Tully.
“Dubai
Customs has been highly receptive to the concept
as it highlights Dubai's growing initiative
to be the region's leading logistics and business
hub,” he added
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