UAE Finance and Industry Ministry signs taxation treaty with Luxembourg

The UAE Minister of Finance and Industry, HE Dr. Mohammad bin Kharbash and Luxembourg's Minister of Treasury, HE Luc Frieden presided the signing ceremony. The purpose of the treaty is to open doors for both countries to avoid double taxation and foster economic relations.

The Luxembourg Board of Economic Development - Trade & Investment Office will be situated on the mezzanine floor of the Al Murooj Rotana Suites. The Grand Duke was accompanied by the Luxembourg Trade Commission led by HE Luc Frieden, the Minister of Treasury and HE Jeannot Krecke, Minister of Economy and Foreign Trade.

"The establishment of the multifaceted Trade Office is a stepping-stone towards strengthening bilateral relations between the two countries," said His Excellency Luc Frieden, the Luxembourg Minister of Treasury.

"The economies of Luxembourg and UAE compliment each other in different ways. UAE is an emerging market in the financial sphere and its manufacturing economy is growing with a momentum of its own establishing a foothold in the international export markets. Luxembourg conversely is the world's 8th largest financial centre and offers a launch pad to a EU consumer market 375 million strong. This equation allows both the country's to draw several parallels for mutual economic benefits,"

said Luc Frieden, Luxembourg Minister of Treasury.

In the spirit of developing an international pro-business environment, the small but significant Duchy continues to enact legal and regulatory frameworks to accommodate global advancements. Hence the inclusion of laws governing Shariah compliance. The Luxembourg financial centre has six registered Islamic funds from the region.

The Luxembourg Chamber of Commerce and the Abu Dhabi Chamber of Commerce also signed an MOU to facilitate bilateral relations on Saturday, 19th November 2005.

With over $1.4 trillion assets under management, opportunities offered by the accomplished finance industry of Luxembourg spans beyond the economic equation towards socio-economic spheres such as knowledge and skills transfer.

For UAE based SMEs, Luxembourg presents a multitude of attractive benefits such as a whole range of instruments to facilitate their establishment on the Luxembourg market or to expand their presence in the Grand Duchy. Because of its proximity to the main industrial and commercial centres, the logistical platform can be the ideal place to enter the European single market area.

"Luxembourg's is a very dynamic economy and our government is committed to broadening economic horizons through policies aimed at diversification. We hope that the Taxation Treaty to avoid double taxation would encourage local companies to explore business opportunities in the Grand Duchy and vice versa," said HE Luc Frieden.

Although the best-known characteristic of Luxembourg is its multitude of financial offering (around 160 international banks and 800 investment funds), it is not the only pillar of the service sector. The Grand Duchy is home to the world's second largest satellite operator, SES Global and only recently, Amazon.com, Microsoft, Apple I-tunes as well as AOL have announced the transfer of their European headquarters to Luxembourg, giving their customers benefit of the lowest VAT rate in the European Union.

With foreigners making up 37% of the resident population and over 50% of the labour force, Luxembourg can truly be described as a cosmopolitan country. Rapid and easy access to government officials and quick decision-making create ideal conditions for the international investor as well for companies looking for local trade partners.

The Trade and Investment Office will act as a consulting house for investors and traders by providing the right facilities to all parties concerned.