Treaty-driven growth
Clyde & Co takes a closer look at strategic advantages of investment in the UAE and how businesses can leverage CEPAs, BITs and DTTs amid shifting global trade dynamics.
Global trade has faced sustained turbulence over recent years, but 2025 has intensified these pressures. Rising tariffs, expanding geopolitical sanctions, and increasingly fragile supply chains have forced businesses to rethink market access and operational resilience. Against this backdrop, the UAE’s legal and economic framework has proven notably robust; largely due to long-term strategic planning that recognised early on the value of three powerful international instruments: Comprehensive Economic Partnership Agreements (CEPAs), Bilateral Investment Treaties (BITs), and Double Taxation Treaties (DTTs).
Together, these agreements are not only cushioning UAE-based businesses from external shocks, but also opening new growth corridors across Asia, Africa, and Europe. Increasingly, companies are seeking to align their operating models and investment structures to capitalise on this evolving treaty landscape. In practice, navigating this landscape demands integrated corporate and regulatory advice, an area where Clyde & Co’s corporate practice has long supported clients structuring investments and operations through the UAE.
CEPAs: A gateway to global markets
The UAE’s CEPA programme has expanded rapidly, with 32 agreements signed and 14 currently in force with the first CEPA signed with India in 2022 and the latest with Philippines in January 2026. These agreements go well beyond traditional free trade arrangements. They provide for tariff elimination on up to 99 per cent of goods, expanded market access for services and digital trade, and regulatory cooperation across sectors such as logistics, renewable energy, and e-commerce.
The India–UAE CEPA is a flagship example. In force since May 2022, it has become a cornerstone of bilateral trade strategy between two major economies. According to press reports, the agreement contributed to a 20.5 per cent increase in non-oil trade and a 75 per cent rise in UAE exports by the end of 2024. Non-oil trade reached USD37.6 billion in the first half of 2025 alone, representing a 33.9 per cent year-on-year increase. Tariff elimination on 90 per cent of Indian exports; including textiles, electronics, gems, and food products; has further strengthened commercial ties.
The strategic importance of the CEPA became particularly evident in 2025 when the United States imposed tariffs of up to 50 per cent on certain Indian exports, disrupting an estimated USD30–35 billion in trade flows. In response, many Indian exporters began relocating operations or restructuring supply chains, with the UAE emerging as a preferred jurisdiction. Goods routed through UAE free zones typically face significantly lower tariffs, while the CEPA ensures preferential treatment for goods originating or processed in the UAE.
Beyond India, newly signed CEPAs with Malaysia, Kenya, and Australia in 2025 and Philippines in 2026 offer UAE businesses preferential access to fast-growing markets across Asia-Pacific and Africa. Crucially, as enforceable international treaties, CEPAs provide a level of predictability that is vital for business planning in an era of rapid regulatory and geopolitical change.
The UAE’s traditional role as a global trading hub further amplifies these advantages. Businesses are increasingly restructuring supply chains to route exports through CEPA partners, mitigating the impact of US and EU tariffs. Activity in key free zones such as Jebel Ali Free Zone (JAFZ) and Khalifa Economic Zones Abu Dhabi (KEZAD) continues to grow, supported by alignment with CEPA rules of origin and streamlined customs processes.
CEPAs also support regulatory cooperation. Under the UAE–India CEPA for example, collaboration in areas such as digital payments, open finance, and data protection has accelerated. The UAE’s open finance regulations and sandbox licensing frameworks allow fintech firms to test and scale services efficiently, while integration with India’s UPI payment system enables seamless cross-border payments in local currencies. As a result, Indian fintech companies are increasingly establishing operations in DIFC and ADGM, using the UAE as a launchpad for regional expansion. This momentum is reciprocal, highlighted by the announcement that GITEX AI India will debut in 2027.
BITs: Legal certainty in uncertain times
Alongside trade access, legal certainty remains a decisive factor for cross-border investment. With over 100 BITs in force, the UAE offers strong protections for both inbound and outbound investors. While treaty protections must always be assessed on a case-by-case basis, BITs typically provide safeguards such as fair and equitable treatment, protection against expropriation, and access to investor-state dispute settlement mechanisms.
UAE investors expanding into Africa and South Asia are increasingly relying on BITs to de-risk investments in jurisdictions facing political or economic volatility. The India–UAE BIT, in force since August 2024, together with the UAE’s extensive BIT network across Africa, has also made UAE-based entities an attractive platform for Indian and African investors structuring outbound investments. These structures combine investment protection with CEPA-enabled market access.
DTTs: Tax efficiency as a strategic advantage
While VAT and corporate tax are relatively recent developments in the UAE, its DTT network; now exceeding 130 treaties; has been built over decades. These treaties play a critical role in mitigating double taxation, providing certainty on taxing rights, and reducing withholding taxes on cross-border income. Most also include mutual agreement procedures for resolving disputes between tax authorities.
Multinational groups are increasingly using UAE-based holding and intellectual property structures to optimise tax exposure while maintaining commercial substance. Such structures are commonly deployed to support operations across India, Africa, and Europe, combining tax efficiency with treaty protections and ease of capital repatriation.
A competitive edge through strategic alignment
In a world defined by rising tariffs, sanctions, and regulatory fragmentation, the UAE offers businesses a rare convergence of market access, investment protection, and tax efficiency. CEPAs, BITs, and DTTs are no longer merely compliance tools; they are strategic enablers of resilience and growth.
Across sectors including logistics, manufacturing, fintech, and energy, companies are actively restructuring supply chains, establishing joint ventures, and optimising holding structures to take advantage of the UAE’s treaty framework. Common strategies include routing exports through UAE free zones, partnering with Indian and African counterparts to access CEPA benefits, and using DTTs to facilitate tax-efficient profit repatriation and dispute resolution. As global trade dynamics continue to shift, businesses that proactively align with the UAE’s legal and economic architecture are best positioned not only to weather uncertainty, but to turn
Text by:
- Julia Ofer, legal director, Clyde & Co
- Kinshuk Kislaya, senior associate, Clyde & Co
- Liam Thomas, senior associate, Clyde & Co
