Business Setup In Dubai UAE

The Process To Establishing Businesses 

The process of establishing a company in the UAE involves only a few simple steps, in all seven emirates. You can apply in person at the Department of Economic Development in the emirate where you plan to establish business. Establishing a company typically involves identifying the location, specifying the nature of business and paying ascribed fees, for the issuance of a commercial license.

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Starting a business regularly

  • Identify A Business Activity.
  • Selecting an appropriate legal form.
  • Registering the trade name.
  • Applying for an initial approval.
  • Drafting a Memorandum of Association and local service agent agreement.
  • Select a business location.
  • Get additional government approvals.
  • Submit documents and pay fees.
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Business Setup in Dubai and UAE

Setting up a business in the United Arab Emirates (UAE) can be an attractive proposition due to its strategic location, business-friendly environment, and various free zones that offer tax incentives and other benefits. Here is a guide on how to set up a business in the UAE:

1. Decide on the Business Structure:

  • Free Zone Company: If you want 100% ownership of your business and are willing to operate within a specific free zone.

  • Mainland Company: If you plan to do business outside the free zones and want to have a local Emirati partner or service agent.

  • Offshore Company: For businesses that don’t require a physical presence in the UAE and are mainly used for holding assets or international trading.

2. Choose the Right Business Activity:

  • Determine the specific activities and services your business will engage in. Different activities may require different licenses and approvals.

3. Select a Business Name:

  • Choose a unique and appropriate name for your business. Make sure it complies with UAE naming regulations.

4. Obtain Necessary Licenses and Approvals:

  • Depending on your business activity and location (free zone or mainland), you’ll need to apply for the relevant licenses and approvals from government authorities.

5. Find Local Sponsorship (Mainland Company):

  • If you’re setting up a mainland company, you’ll generally need a local Emirati partner who will hold at least 51% ownership in the business. There are exceptions for certain professional licenses.

6. Register Your Business:

  • Submit the required documents and pay the necessary fees to register your business with the relevant authorities.

7. Open a Corporate Bank Account:

  • Once your business is registered, you’ll need to open a corporate bank account in the UAE.

8. Arrange Office Space:

  • Depending on your business setup, you may need to lease office space in a free zone or mainland location.

9. Hire Employees (if needed):

  • If your business requires employees, you’ll need to apply for work visas and comply with UAE labor laws.

10. Comply with Taxation Regulations: – The UAE has introduced a Value Added Tax (VAT) system. Ensure your business complies with VAT and other taxation regulations.

11. Protect Your Intellectual Property (if needed): – If your business relies on intellectual property, consider registering trademarks, patents, and copyrights to protect your assets.

12. Seek Legal and Financial Advice: – It’s advisable to consult with legal and financial experts who are well-versed in UAE business regulations to navigate the complexities of setting up a business.

13. Consider Cultural and Business Etiquette: – Familiarize yourself with the cultural norms and business etiquette in the UAE to build strong relationships with local partners and clients.

14. Maintain Compliance: – Ensure ongoing compliance with UAE laws and regulations to avoid any legal issues in the future.

15. Network and Build Relationships: – Building a network of contacts and relationships with local businesses and government authorities can be crucial for success in the UAE.

Setting up a business in the UAE can be a rewarding venture, but it’s essential to have a clear understanding of the specific requirements and regulations related to your business activity and location. Seek professional guidance to ensure a smooth and successful business setup process.

Grow in UAE – Promising Investment Opportunities

Over the past 50 years, the United Arab Emirates has been able to transform its fishing and agriculture-based economy into an advanced and competitive economy, thanks to the comprehensive and integrated development plans of the government. These plans have come to fruition, culminating in the UAE becoming a global frontrunner for economic performance and favorable investment environment. The proactive vision of the country’s wise leadership has been a pivotal enabler, which has contributed to transforming the UAE into a global investment hub. This was coupled with activating enablers of smart government, adopting a modern approach in managing the UAE’s affairs, and promoting investment in new economic sectors such as technology, artificial intelligence and space sciences. The country’s economic performance has reflected on improved standards of living for individuals and increased corporate revenues; in addition to boosting Invests opportunities. Today, the UAE looks forward to another 50 years of development and prosperity.

Why the UAE is Considered – One of the World’s Most Attractive Investment Hubs

The investment attractiveness of the UAE witnessed a steady increase over the past years. With its ability to attract substantial investments, the country enhanced its cumulative FDI inflows and became one of the most preferred investment destinations across the world. According to the United Nations Conference on Trade and Development (UNCTAD), the UAE was the world’s 15th biggest recipient of foreign direct investment in 2020. It was also ranked the most attractive country for investments in West Asia, Middle East and North Africa regions. Today, the UAE is looking to attract more investments, promote its investment environment, provide greater incentives to investors, and raise its rank on the Ease of Doing Business Index.

Effective Government Strategies

The UAE Government has ambitious strategic development objectives, and realises its vision through wise policies and initiatives that aim to drive the economy and foster happy societies. These development plans were accompanied by exceptional projects for more than half a century, even as it aspires for a more diversified, competitive and adaptable economy based on science and innovation. The UAE’s future endeavors are spearheaded by inclusive strategies towards achieving a digital and knowledge-based economy.

A Diversified and Competitive Economy

The UAE made tremendous efforts in economic and social development to transform its simple economy into a modern, advanced, open and competitive economy. Over the last 50 years, the UAE managed to increase its GDP more than 247 times (AED 1.6 trillion compared to AED 6.5 billion when the union was established), reducing the contribution of oil to the GDP to less than a third, compared to more than 90% in 1971.

Strategic Infrastructure and Location

The government has pumped investments and capital into major public transport and renewable energy projects that have become key pillars in the new economic milieu. The UAE has 10 major airports, 12 seaports, an unrivalled network of roads and bridges, and 6 national carriers connecting to over 200 cities worldwide. This enables 33% of the world’s population to reach the UAE within 4 hours, and 66% to access the country within 8 hours.

100% Company Ownership

Investors of all nationalities can establish and fully own companies in the UAE. This change came about following the enactment of the Commercial Companies Law in 2020, according to which a foreign company wishing to open a branch and practice its activities in the UAE does not require the presence of a UAE national agent.

40 Free Zones for Company Incorporation

More than 40 free zones allow tax exemptions and 100% ownership for foreign investors. The UAE also provides these investors great flexibility in selecting the most appropriate zones for establishing their businesses. Free zones are located throughout the UAE, allowing investors to engage in a wide variety of economic businesses and activities.

Investing in All Economic Activities

Foreign investors can invest in the trade, industry, agriculture, services, education, health and construction along with several other sectors across the UAE. There are more than 2,000 licensed economic activities, with local laws excluding only a very limited number of domains.

No Minimum Capital

The UAE law directs investors to specify the value of capital in articles of incorporation and company statutes but does not require a minimum amount for limited liability companies. This greatly facilitates the incorporation of companies and the establishment of new businesses, while giving investors additional flexibility in planning their projects.

 

A Dubai Mainland license is an onshore company allowing entrepreneurs to conduct business activities inside and outside of the UAE. The trade licenses for mainland companies are issued by Dubai’s Department of Economic Development (DED).You can register a professional license or commercial license in Dubai Mainland. The trade license issued by DED is considered more premium and allows for the following benefits.

To get a company registered in Dubai, it is not mandatory to have a physical office space and The Infinite Service’s co-working DED package would be the perfect solution to get you started.
 

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FAQs

What are the different economic zones in the UAE?

The UAE’s economic zones include Mainland, Free Zone, and Offshore, each with unique business laws and regulations.

What is the significance of the Memorandum of Association in starting a business in Dubai?

The Memorandum of Association (MOA) is a crucial legal document defining your business’s scope and operations. It should comply with UAE government regulations and protect your business interests.

Is it mandatory to have a local agent when starting a business in Dubai?

For certain business activities and jurisdictions, it is mandatory to have a local Emirati partner or agent. However, this can be bypassed with the help of a business setup consultant.

What types of trade licences are available in the UAE?

The UAE offers four types of trade licensees: Commercial, Professional, Industrial, and Tourism, depending on your business activity.

What is the role of the Department of Economic Development (DED) in business setup in Dubai?

The DED is responsible for approving company names, business activities, issuing trade licenses, and overseeing the overall company registration process in Dubai.

Can foreign entrepreneurs own 100% of their businesses in Dubai-free zones?

One of the major advantages of setting up a business in Dubai-free zones is that foreign entrepreneurs can have 100% ownership of their organizations.

What are the key benefits of starting a business in a free zone?

The main benefits include 100% ownership, tax benefits, and simplified regulations for doing business.

Are there any limitations to setting up a business in a free zone?

Some businesses, particularly those in the service industry, may perform better in city markets than free zones. Some free zone spaces might also incur higher costs than city market spaces.

What is the required foreign ownership percentage for mainland Dubai businesses?

Foreign owners must hold only 49% equity of the business in mainland Dubai. However, there are exceptions for certain business activities with GCC ownership and partnerships with Emirati companies. Read whether a mainland company can do business in Freezone.  

How can I select the best location for my business in Dubai?

Analyze your business’s nature, products, and target market to align your location with your strategic goals. Consider convenience, cost-effectiveness, sustainability, and profitability factors to make an informed decision.

Can I hire expatriate employees for my business in Dubai?

Yes, you can hire both local Emirati employees and expatriates. However, there are specific procedures for obtaining work visas for expatriate staff.

What is the local sponsorship requirement for mainland companies?

Mainland companies require a local Emirati sponsor who will hold 51% ownership, while the foreign investor retains 49%.

Can a foreigner fully own a business in Dubai?

Yes, foreigners can enjoy full ownership of their businesses in Dubai through free zone companies

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