The Dubai Department of Economic Development (DED) on Tuesday hailed a new decree to exempt companies from administrative fines in a fresh effort to stimulate business in the emirate.

A decree by Dubai ruler Sheikh Mohammed bin Rashid Al Maktoum cancels fines imposed by the DED through to the end of 2018 to further enhance the competitiveness of the emirate.

The DED, which levies over 60 different fines for commercial violations, said the decree is a "strong testament to the leadership’s continued support to the business sectors in the emirate and in overcoming all obstacles that face them".

The move comes as some businesses have been hurt by the introduction of 5 percent value added tax across the UAE at the start of 2018.

Sami Al Qamzi, director general, DED, said: “DED urges all business owners to benefit from the decree, which exempts companies and establishments operating in the emirate of Dubai from all the fines imposed on them, and facilitate the procedures for renewing licenses by the end of 2018.

"This will add to the financial benefits of the owners of expired business licenses, restore legal records and licenses, and help the business community in Dubai enhance their competitiveness."

Omar Bushahab, CEO, Business Registration and Licensing Sector in DED, added: “This decree is a positive step in promoting economic growth and consolidating Dubai's position as one of the important commercial and economic centres internationally.

"It reaffirms to investors and businessmen around the world that Dubai effectively addresses various economic variables with a forward-looking vision by adopting best practices and regulations. It also helps to remove concerns among investors and entrepreneurs looking to expand their business."

The decree is part of the initiatives launched by Sheikh Mohammed to reduce cost of doing business and facilitate inward investment in the emirate.