The unprecedented impact of AI over the last few years has reshaped entire industries, automated processes that once took hours, and unlocked data insights at a speed and scale we’ve never seen before. In addition to these many benefits, AI holds real potential for one of today’s biggest challenges of sustainability.

As industries worldwide look to cut their environmental impact, AI could provide answers. In the UAE, where innovation is a national priority, there’s a unique opportunity to use AI to achieve ambitious sustainability goals.

However, the sector isn't without its challenges. Whilst it can help businesses go green, it can also be very energy intensive. The key is finding ways to adopt AI in a way that minimises its environmental footprint.

Fortunately, there are already several real-world applications.

Use Cases for AI in Sustainability in the UAE

• Efficiency in Resource Use: The first one is optimising how industries use resources. For example, AI can analyse energy use patterns in areas like energy grids and agriculture to adjust distribution, reduce waste and supporting the shift to renewables. This is especially useful in the UAE, where managing cooling systems during the hot months is a big energy challenge.
• Digital Twins for Smarter Decisions: Digital twins—virtual models that simulate real-world systems—allow businesses to test changes before implementing them. This means manufacturers can adjust processes to save energy without disrupting production. In urban planning, a digital twin of Dubai could help planners optimise transport routes to cut emissions.
• Predictive Analysis for Climate Risks: AI’s ability to forecast is becoming a game-changer for managing climate risks. Predictive models can help farmers plan irrigation more efficiently, saving water in the UAE's desert climate, and also identify areas at risk of extreme weather, helping them safeguard operations.

Setting Up an AI Company in the UAE

Thanks to a combination of forward-thinking policies and strategic location, the UAE’s becoming a hotspot for tech companies but to get your AI company off the ground, there are a few key steps to follow:

1. Choose the Right Location: Mainland or Free Zone: 

The UAE offers two main options for setting up your business: the mainland or free zones. Free zones like Dubai Internet City, Abu Dhabi Global Market (ADGM), and Dubai Silicon Oasis come with several perks, such as 100% foreign ownership, simplified setup processes, and tax incentives. They’re a great choice if you plan to focus on international markets or operate within the free zone itself, but if your goal is to do business directly across the UAE, a mainland setup might be a better option, as it allows you to trade freely throughout the country.

2. Obtain the Necessary Licences: 

The most relevant options for AI ventures include:

• Artificial Intelligence Services Licence: For businesses directly involved in AI development, including machine learning, data analysis, and automation.
• IT Consultancy Licence: This option has a broader scope allowing companies to provide AI-related consulting, development, and deployment services across various sectors.

Applications are typically processed through the relevant free zone authority or the Department of Economic Development (DED) for mainland setups, though some businesses might need additional approvals from the UAE’s Telecommunications and Digital Government Regulatory Authority (TDRA).

3. Structure Your Business and Prepare Documentation 

Choosing the right business structure is key—most opt for a Limited Liability Company (LLC) or Free Zone Establishment (FZE). For both, you’ll typically need:

• Passport copies of shareholders and directors
• Proof of address
• Business plan detailing your AI services and market approach
• Office lease agreement (for physical or virtual offices)

Assuming all documentation is in order, you can usually obtain a free zone licence in a matter of days, but for mainland setups, it can take a little longer: usually between 2-4 weeks.

4. Leverage the UAE’s Talent and Innovation Ecosystem: 

The UAE’s focus on STEM education means there’s no shortage of skilled talent in AI, data science, and engineering. Free zones often offer visa packages, making it easier to bring in the right people. Plus, teaming up with local universities or research hubs like the AI Institute at Mohamed bin Zayed University (MBZUAI) can give you an edge with fresh ideas and expertise.

How Can Sovereign PPG Help?

The UAE is a top spot for AI startups, thanks to its focus on both tech and sustainability. Whether your business is involved in optimising energy use, designing smarter cities, or improving supply chains, you’ll find a receptive market and have access to unique incentives, cutting-edge research and a growing pool of tech talent.

Setting up an AI company in the UAE can be complex, but Sovereign PPG makes it simple. Our experienced team has deep knowledge of local regulations and strong connections with key government departments, ensuring a smooth setup process. From selecting the right location to obtaining licences and managing documentation, we guide you every step of the way.

If you need assistance with setting up your AI business in the UAE or any other related onshore or offshore company setup, restructuring, local partner, or PRO support matter in Abu Dhabi, Dubai, the wider UAE, Oman, Qatar, or Saudi Arabia, then please get in touch with us at +971 4456 1761 for Dubai or email SovPPG@SovereignGroup.com. Alternatively, you can complete the contact form below, and we will be delighted to assist you.