Business Valuation

In several defined situations. Article 78 of Federal Decree-Law No. 32 of 2021 requires in-kind contributions to an LLC's capital to be valued by one or more financial advisors approved by the Securities and Commodities Authority and selected by the competent authority, at the contributing partner's expense; a valuation done any other way is void. Article 80 sends a disputed price for a partner's stake to experts nominated by the competent authority. Under the corporate tax law, restructurings that fall outside relief are measured at market value, and merger-control filings demand market-share analysis. We prepare valuations to the standard each of these regimes expects, so the report survives the authority that reads it.

Source: UAE Legislation Portal (uaelegislation.gov.ae) — Federal Decree-Law No. (32) of 2021 on Commercial Companies (accessed 24 October 2026)

Article 1 of Federal Decree-Law No. 47 of 2022 defines market value as the price which could be agreed in an arm's-length free market transaction between persons who are not related parties or connected persons in similar circumstances. The definition matters because the law uses it repeatedly: non-share consideration in a restructuring is tested against it, a clawed-back restructuring is deemed to occur at it, and Article 36 allows a payment or benefit to a connected person to be deducted only to the extent it corresponds with the market value of the service or benefit provided. Our valuation reports are written to that definition so the Federal Tax Authority can follow the reasoning.

Sources: Ministry of Finance — Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses and its amendments (consolidated text); Ministry of Finance — Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses and its amendments (consolidated text) (accessed 24 October 2026)

The five methods in Article 34 of Federal Decree-Law No. 47 of 2022: the comparable uncontrolled price method, the resale price method, the cost-plus method, the transactional net margin method and the transactional profit split method. Article 34 also allows any other method where the taxable person can demonstrate that none of the listed methods can reasonably be applied, which is where discounted cash flow and other valuation techniques come in for transfers of shares, businesses or intangibles between related parties. Whatever the method, the result must be consistent with what persons who were not related parties would have realised in a comparable transaction. We select and document the method in the valuation report.

Source: Ministry of Finance — Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses and its amendments (consolidated text) (accessed 24 October 2026)

A market analysis, supported by audited numbers. Cabinet Resolution No. 3 of 2025 triggers a filing where the parties' combined share exceeds 40 per cent of total transactions in the relevant UAE market, or their annual sales in that market exceed AED 300 million, so defining the relevant market and measuring share is unavoidable. The Ministry of Economy and Tourism then requires audited financial statements for the preceding three financial years and a report on the economic dimensions of the concentration covering market analysis, competitors, customers and consumer impact. Our valuation and commercial due diligence work feeds directly into that report, so the numbers filed with the Ministry match the numbers in the deal.

Sources: UAE Legislation Portal (uaelegislation.gov.ae) — Cabinet Resolution No. (3) of 2025 Regarding the Ratios to the Implementation of Federal Decree-Law No. (36) of 2023 Regarding Regulation Competition; Ministry of Economy and Tourism — Economic Concentration (accessed 24 October 2026)

The transfer is re-measured at market value. Ministerial Decision No. 133 of 2023 limits the non-share consideration in a Business Restructuring Relief transaction by reference to the market value of any other forms of consideration received in addition to shares, and Article 27 of Federal Decree-Law No. 47 of 2022 provides that where the relief is withdrawn the transfer is treated as having taken place at market value at the date of the transfer. An understated or overstated value therefore changes the taxable gain and can invalidate the relief altogether. We value the business before the documents are signed, not after the Federal Tax Authority asks.

Sources: Ministry of Finance — Ministerial Decision No. 133 of 2023 on Business Restructuring Relief for Corporate Tax Purposes; Ministry of Finance — Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses and its amendments (consolidated text) (accessed 24 October 2026)

Not without tax consequences. Article 35 of Federal Decree-Law No. 47 of 2022 treats natural persons related within the fourth degree of kinship or affiliation as related parties, and a natural person and a company in which that person or their relatives hold 50 per cent or more as related parties too. Article 34 then requires transactions and arrangements between related parties to meet the arm's-length standard in determining taxable income, so a company's transfer at a token price is re-measured at the price independent parties would have agreed. A short, documented valuation at the time of the transfer is cheaper than an argument with the Federal Tax Authority later. We prepare it as part of the transfer file.

Sources: Ministry of Finance — Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses and its amendments (consolidated text); Ministry of Finance — Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses and its amendments (consolidated text) (accessed 24 October 2026)