Dubai: Companies in the tourism industry will soon be able to get back the bank guarantees they had earlier set aside when they started doing their business in Dubai.
Entrepreneurs who are planning to start a business will also no longer need to raise a huge amount as a guarantee before securing a trade license in the emirate.
Dubai’s Department of Tourism and Commerce Marketing (Dubai Tourism) confirmed on Tuesday that it has initiated efforts to release Dh250 million in bank guarantees that have been furnished by tourism-related service providers, following a decision to scrap the requirement to start a travel and tour business in the emirate.
The move will not only lower the cost of doing business, it will boost liquidity of local businesses and enable them to reinvest some money into the economy. It will benefit over 2,000 travel and tour agencies operating in Dubai.
Previously, tourism companies including inbound and outbound tour operators were required to put up a bank guarantee ranging from Dh100,000 to Dh600,000, depending on the type of business activity, to Dubai Tourism, as a precondition for the Department of Economic Development (DED) to grant a trade license.
“Cancellation of this provision enables Dubai Tourism to refund the bank guarantees to the companies providing much-needed funds to reinvest in their business and grow their services,” the government agency said in a statement.
“Similarly, going forward for all new ventures, investors and entrepreneurs will also no longer need to provide such bank guarantees to Dubai Tourism either to open a tourism establishment or to offer specific travel or tour-related services and activities in Dubai.”