Hungary to Dubai: Why More Companies Choose UAE Over the EU

By late 2024, the number of Hungarian participants in the Dubai Chamber of Commerce rose to 201, an impressive 48% growth in 12 months. This momentum echoes the broader trend of global business interest in Dubai, UAE, in pursuit of a more flexible, transparent, and pro-business climate.

Dubai continues to gain even more traction as a jurisdiction for business setup, with more than 120,000 new company formations recorded to date since the start of 2024. Not only do new businesses choose Dubai for company incorporation, however, but also many established firms are looking for a more business-friendly climate that fosters long-term growth.

Over recent years, businesses all over the world have been increasingly moving to the United Arab Emirates (UAE), reflecting the country’s growing appeal as a leading business-friendly hub. In this regard, Hungary is no exception, with Hungarian residents actively shifting their operations to Dubai over recent years.

Business relocation to the UAE has become a massive migration trend these days, expected to accelerate even further as firms seek a jurisdiction with a more favorable environment. While the EU still remains a major market, a growing number of founders choose the UAE, and Dubai in particular, as a more compelling long-term home base.

Why Is Dubai So Popular for Company Incorporation?

Dubai and the wider UAE have become a natural choice for global entrepreneurs for multiple reasons, one of them being a favorable tax framework designed to support business growth.

In Dubai, companies are generally subject to a 9% corporate tax on their taxable income, while certain eligible businesses that meet relevant conditions may benefit from a 0% rate of qualifying income for up to 50 years (activity-specific). With 0% personal income, capital gains, and inheritance taxes for individuals, Dubai becomes especially attractive for startup founders.

Equally attractive is the fast, streamlined incorporation process built around a few easy-to-follow steps, irrespective of the selected structure. Dubai has deliberately reduced the bureaucratic friction, transforming what is often a couple of months’ process in selected European countries into a matter of 14 days, on average. Nonetheless, businesses in industries requiring additional authorization should expect longer times to incorporate, sometimes reaching multiple months.

Highly competitive costs to set up a business in Dubai further strengthen the region’s position. While initial setup fees may sometimes seem higher compared to EU jurisdictions, ongoing operational costs are typically much lower. On average, registering a business in Dubai typically costs between AED 25,000 and AED 29,000 (around $6,800–$7,900), according to Inteliumlaw, industry-leading international business structuring consultants.

In many cases, what tips the scale for entrepreneurs in favor of relocating a business to Dubai from a “home place” is the country’s unmatched business networking. Dubai, with its strategic location, offers immediate access to high-growth markets within arm’s reach, backed by best-in-class logistics, robust infrastructure, and a stable political environment. At the same time, an ecosystem of venture investors, institutions, and multinational firms enables countless opportunities for meaningful partnerships that would otherwise require years to cultivate elsewhere.

Finally, what sets Dubai apart from many mature economies is its long-lasting commitment to pro-business policymaking. While others are tightening the screws, the UAE is making regulations more transparent and commercially viable, introducing residency options for investors and sector-specific incentives, among others.