UAE leaders are committed to attracting FDI in the country and becoming an economic hub in line with Hong Kong, London or New York. The UAE government is aware of the importance that transparency and accountability have for business development and to that end the government has established the Department for Foreign Investment at the Ministry of Economy. The Department provides investors with information about regulation, investment opportunities and also provides direct customer service. Companies wishing to invest in the UAE can therefore gather information about investment policies and regulations, as well as about the country in general on the Ministry of Economy's website. Moreover, the federal government has plans to privatise some sectors of the economy to rationalise expenses and attract foreign investors. For example, the UNDP Programme of Governance in the Arab Region reports that the local government of Abu Dhabi - which accounts for about 95 % of the oil production - is trying to modernise the oil sector in terms of technologies and management techniques by engaging foreign companies. At the federal level the largest privatisation projects include water desalinisation and electricity production and distribution. The UAE operates 38 free trade zones where national ownership requirements as well as every import or export tariff are waived if the goods are only processed in these zones and do not enter other parts of the country. The government also offers support services to foreign firms working in the free zones.

Business executives interviewed in the World Economic Forum Global Competitiveness Report 2010-2011 do not cite corruption as a major obstacle to doing business in the UAE. Access to financing, the lack of skilled labour force and restrictive labour regulations instead constitute some of the largest obstacles. A 2009 study, however, highlights the UAE's low degree of good governance, which is especially prevalent in the private sector as a major obstacle. Allegedly, the fast paced economic development undergone in the UAE in recent years has not resulted in modernisation of the way companies are managed. Personal relationships still play a huge role in obtaining and retaining business as well as in company hiring processes. The Bertelsmann Foundation 2010 reports that market competition in the UAE has to improve, as foreign companies still have to rely on local sponsorship if they want to succeed in their business. Moreover ruling families' involvement in the economy provides for an uneven playing field and conflict of interests is a major area of concern since the same person can cover governmental as well as business positions at the same time.

Corruption in the private sector takes the form of fraud or embezzlement rather than bribery, as reported by the police in a 2009 news article. Several cases of senior management from leading real estate and financial companies defrauding their company or shareholders were under investigation in 2009 as well as the previous year. In 2008, top officials of the Dubai sovereign wealth fund, Istithmar World, were investigated for wrongdoing in their position at the Dubai mortgage lender Tamweel. This incident created such an impact that it negatively affected real estate stocks prices in the UAE. Generally however, companies in the UAE rank well in the World Economic Forum Global Competitiveness Report 2010-2011 in terms of their ethical behaviour in the interaction with public officials, politicians and other companies. In the same report UAE also ranks well in terms of the irregular payment of bribes. This is backed up by the US Department of State 2011, which states that there is no evidence showing corruption of public officials to be a systematic problem.

Government regulation is not a big constraint for companies doing business in the UAE, according to the business executives interviewed in the World Economic Forum Global Competitiveness Report 2010-2011. Companies have to be registered to operate in the country and the authorities uphold this requirement strictly. The government has cut red tape to facilitate the establishment of new investors, and is expected to continue a more conducive environment for foreign investment, according to the US Department of State 2011. The procedures to get an operating licence are now reportedly straightforward and publicly available in all emirates. This fact is confirmed by the results obtained under the 'starting a business' criteria in the World Bank & IFC Doing Business 2011. It now takes an average of 15 days and 8 procedural steps at a cost of 6.4% of GNI per capita to launch a business. Building permits could also be obtained faster now than during previous years due to improvements in the online system processing applications. Altogether, the UAE is in the process of implementing e-governance in many sectors to enhance the efficiency of service delivery and eliminate face-to-face encounters between companies and civil servants. Improvement in the oversight of public funds is also likely to occur after the reform of the State Accounting Institution (SAI), which occurred in 2008. It is reported that the SAI will shift its accounting practices from a mere control of the regularity and legality of its spending, to a performance control based on the efficiency of spending and the attainment of its prefixed results.

Investment laws have improved according to the US Department of State 2011 and the environment is now more conducive for business. Investment by foreign nationals is still restricted by law and home companies are favoured over foreign ones, but the regulatory environment is being reviewed to mitigate this discrimination. Currently the Federal Companies Law requires that UAE nationals own at least 51% of commercial companies operating in the country. Moreover, foreign products can only be distributed by fully national owned companies. A new law allowing 100% foreign ownership in health, education, computer and professional service sectors is still being awaited and is subject to Cabinet approval, as reported by the US Department of State 2011. Altogether the new law should improve the FDI inflow and transparency for investors. As for public procurement, the Tenders Law only allows bids by UAE nationals or companies with 51% UAE national ownership. Consequently, international companies wishing to bid for a project have to enter into joint ventures with national companies. The US Department of State 2011 reports that government tendering is not conducted according to generally accepted international standards, and retendering is the norm. The UAE government continues to lead the region in protecting intellectual property rights (IPR), even though some argue that it could do more to stop transhipping of counterfeit goods.

Dispute resolution can be difficult and uncertain, as reported by the US Department of State 2011. Arbitration is a commonly used measure to resolve commercial disputes, but it is reportedly difficult to enforce the awarding, as it must be endorsed by the courts. Court proceedings may reportedly continue for several years. The UN Convention on the Recognition and Enforcement of Foreign Arbitral Awards has been effective in the UAE since 2006. Any award issued in other member states will consequently be directly enforceable in the UAE. Moreover, UAE is member to the International Centre for Settlement of Investment Disputes (ICSID). The judiciary is not independent from the government, as judges at the federal level are appointed by the Ministry of Justice and in some emirates by the ruling families. The majority of the judges are foreign nationals. Commercial disputes are normally heard by civil courts, but in the emirate of Abu Dhabi, they are first brought before the Abu Dhabi Conciliation Department. In Dubai and Abu Dhabi, the chambers of commerce have established arbitration centres to expedite commercial disputes. The award of such arbitration centres have still to be certified by courts and their enforcement can therefore face considerable delays.