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IMPACT – MEDIUM
What is the change? Dubai will soon enter the second phase of its program to require employers to provide health insurance to all employees, including foreign nationals.
What does the change mean? Beginning July 31, companies employing 100 to 999 employees will be required to offer health insurance to all employees. Companies that do not provide health insurance will be unable to sponsor foreign employees applying for visas or renewals.
Background: Dubai adopted a universal healthcare law in 2013. The Dubai Health Authority is working with the General Directorate of Residency and Foreigners Affairs to ensure that companies that fail to meet their obligations under the law will be ineligible to sponsor employees for visas or visa renewals. Some free zones, including the Dubai Multi Commodities Centre (DMCC), already enforce universal healthcare requirements for all companies, regardless of size.
Elsewhere, however, the requirement is being implemented in phases. The first phases of the law, covering companies with 1,000 or more employees, took effect last year. As of July 31, the rules will cover companies employing 100 or more employees. Companies with fewer than 100 employees have until June 2016 to provide health insurance.
BAL Analysis: Companies covered by the second phase of Dubai’s universal healthcare law must provide health insurance to all employees, including foreign employees, by July 31 or risk significant difficulties in the visa process.
This alert has been provided by the BAL Global Practice group and our network provider located in the United Arab Emirates. For additional information, please contact your BAL attorney.
Copyright © 2016 Berry Appleman & Leiden LLP. All rights reserved. Reprinting or digital redistribution to the public is permitted only with the express written permission of Berry Appleman & Leiden LLP. For inquiries please contact copyright@bal.com.
IMPACT – LOW
What is the change? Certain expatriates holding residence permits issued by Gulf Cooperation Council countries are subject to a new rule requiring them to obtain visas before travel to the UAE rather than upon arrival.
What does the change mean? The rule covers expatriates with residence permits issued by Bahrain, Kuwait, Oman or Qatar. UAE authorities carved out an exception for managers, engineers and doctors, but they nevertheless may want to apply for a visa ahead of time to avoid confusion or unnecessary delay.
Background: The change will make travel to the UAE slightly more difficult for some GCC country residents. Immigration authorities have said the new rule will not apply to expatriates whose job title on their residency permit is manager, doctor or engineer, so long as they have had their GCC residency for at least six months.
Those who are affected by the change must apply for tourist visas, family-sponsored visit visas or company-sponsored business visas. These visas are generally valid for 30 days and are not renewable; on-arrival visas are also valid for 30 days, but can be extended for an additional 30 days. Those in need of visas for longer periods of time should contact a BAL attorney about whether any options exist for longer stays in the UAE.
The change described above only applies to expatriates with GCC residence permits; GCC nationals are not affected.
BAL Analysis: While UAE immigration authorities have excepted managers, engineers and doctors from the new requirements, even GCC country residents who fit into one of those categories may want to consider obtaining a visa before travel in order to avoid confusion or delay.
What is the change? The European Union and the United Arab Emirates signed an agreement Wednesday that sets the stage for short-stay visa-free travel between most EU countries and the UAE.
What does the change mean? The agreement will allow visa-free travel for most EU nationals to the UAE and for UAE nationals to most EU countries for up to 90 days in a 180-day period. The U.K. and Ireland are not party to the deal.
Background: Under the terms, EU and UAE nationals with valid passports will be eligible for visa-free travel for tourism, culture, scientific activities, family visits and business. The agreement does not cover “paid activity.” All EU countries with the exception of the U.K. and Ireland are included in the agreement.
BAL Analysis: The agreement signed Wednesday has been more than a year in the making, and is intended to facilitate business travel between EU and UAE nationals.
What is the change? The United Arab Emirates is implementing a new “zero overstay policy” in an effort to crack down on visitors who overstay their visas.
What does the change mean? The new regulations call for fines on anyone who overstays their visa – even by an hour. They will be fined 200 Emirati dirham (about US$54) at the airport per day for a maximum of five days. If they stay beyond five days, they will be required to obtain an exit pass from immigration and pay the penalty at that time. An additional government immigration charge of AED 1,020 (about US$280) per day will be imposed on the sponsoring company, which must pay the fine within 24 hours. A company that fails to pay a fine could be barred from sponsoring future travelers to the UAE.
Background: The UAE government has revamped its visa schemes in recent months to ensure that foreign nationals fully comply with the country’s entry and exit policies. The UAE is taking a zero-tolerance stance toward visa overstays. A business visitor who needs to stay longer must exit, but they may reapply immediately.
In a related change, tourist visas can no longer be extended in-country. Those who do not exit after the permitted duration (30 days or 90 days) are subject to the new overstay fines. Like business visitors, they may reapply immediately without having to observe a 30-day exit period.
BAL Analysis: The steep penalties and no grace period indicate that UAE is stepping up enforcement of those who overstay their visas. All UAE-based companies sponsoring foreign employees and assignees should make sure foreign nationals leave before expiration of their visas and that any fines are promptly paid.
IMPACT – HIGH
What is the change? On Jan. 1, two Dubai free zones will implement a law that requires companies to cover all employees with basic health insurance, and it is expected that all immigration offices in Dubai mainland and all free zones will also adopt the rule in the near future.
What does the change mean? Employers in the Dubai mainland and free zones should be prepared for this new rule, as they will have to purchase and provide proof of employee health coverage before they can renew visas and licenses.
Background: Dubai passed a universal healthcare law one year ago. The law requires employers to provide all employees, including foreign workers, a minimum health insurance plan from an insurer authorized by the Dubai Health Authority. Dubai planned to roll out the programbeginning in 2014 with the largest employers and phasing in medium and smaller employers by 2016. However, implementation has been spotty and official dates have been difficult to ascertain.
So far, only the DMCC and DSO Free Zones have officially announced they will implement the employer-paid health insurance system on Jan. 1.
Dubai Immigration and all free zones are expected to follow shortly thereafter, although no official date has been set.
BAL Analysis: Companies in the DMCC and DSO Free Zones should make sure they are ready for the imminent change. Because the new system will impact nearly all visa applications and renewals for foreign workers and licenses and establishment cards for companies, employers in Dubai mainland and all other free zones should prepare as soon as possible for this requirement, which could take effect soon with little notice.
What is the change? A new online portal for companies operating in the Technology, Electronic Commerce and Media Free Zone is experiencing an extremely high volume of applications.
What does the change mean? The transition to the new portal – which is now mandatory for all visas, renewals, transfers and other services – is currently causing significant delays to all processing.
Background: The portal was launched in October and replaces counter service at the Government Services office. All new visa applications, renewals, transfers, document requests and other services must now be filed online. Companies no longer need to submit application documents in-person; instead, a TECOM courier service collects original documents from applicants’ offices. This is also true for employment visa cancellation, which will no longer require in-person verification by a Government Services officer.
Employers can also apply for new one-year residency permits and one-year renewals through the portal.
BAL Analysis: Once the current delays subside, the portal will ultimately benefit TECOM companies by moving all applications online and offering several new services, including the one-year residency permits and renewals, and an automatic reminder when visas, passports or trade licenses are about to expire to help companies renew on time.
What is the change? Government offices will close for five days in early December in observance of the country’s National Day.
What does the change mean? Processing of visas, work permits and other immigration-related services will be delayed.
Background: The UAE’s National Day celebrates the unification of the seven emirates and the founding of the country in 1971. The government announced this week that most government offices will be closed Dec. 2-6, while private sector workers would be given a one-day holiday Dec. 2.
BAL Analysis: Companies should plan to build an additional week into their timeframes and, if possible, submit filings before the holiday break.
What is the change? All free zones in Dubai have abandoned electronic visa issuance; only physical entry visas are issued.
What does the change mean? Most free zones will courier the entry visas to applicants’ offices in Dubai, except Dubai Airport Free Zone, Dubai Silicon Oasis and Dubai World Central, which do not offer courier service and require someone to pick up the entry visa.
Background: Dubai implemented electronic entry visa issuance, but ran into problems in coordinating the system with the Dubai Airport. Therefore, all of the Free Zones have reverted back to the former process of physically issuing visas.
BAL Analysis: Foreign employees in Dubai should arrange to have their entry visa couriered to their office or in case courier service is not provided, arrange to physically collect the visa from the Free Zone Immigration Offices. If the employee is out of the country, the entry visa must be delivered to the airport of entry prior to arrival.
What is the change? The Immigration and Labor Ministries have begun making unscheduled on-site visits to companies in Dubai.
What does the change mean? Companies located in Dubai mainland and the free zones should prepare for unannounced visits by authorities and make documents available for inspection.
Background: Companies that are visited by immigration or labor officers will be asked that their employees show their Emirates ID and Free Zone ID cards or labor cards, depending on whether they are operating in a free zone or the mainland.
Earlier this year, authorities signaled that they would conduct stronger monitoring, including on-site inspections. Dubai’s TECOM free zone began collecting data of all foreign employees in May, and UAE authorities, particularly in Dubai, increased audits in June.
BAL Analysis: The on-site visits are part of a move toward greater scrutiny and enforcement of labor and immigration regulations.
IMPACT –MEDIUM
What is the change? Government offices will close for five days in early October in observance of Eid al-Adha.
What does the change mean? Processing of work permits and other services will be delayed.
Background: Eid al-Adha, or “Feast of the Sacrifice,” is a Muslim holiday celebrating the end of the annual Hajj pilgrimage. The exact dates will not be confirmed until the lunar moon is observed on Sept. 24 or 25. The holiday, which falls on the 10th day of the lunar month, therefore is expected to start on Oct. 4 or 5.
The UAE observes a five-day national holiday, during which time government offices are closed. Private offices are also closed the first two days.
BAL Analysis: The dates are tentative, but companies should plan now to build an additional week into their timeframes and, where possible, submit filings before the holiday break.