How To Setup
A Business In UAE ?
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To Start Your Business
Choosing a Business Jurisdiction
The UAE offers three main types of business jurisdictions: Mainland, Free Zone, and Offshore. Each jurisdiction has its own rules, benefits, and drawbacks. Mainland companies can trade within the local UAE market and take on government contracts but require a local partner who must hold 51% of the business. Free Zone companies offer 100% foreign ownership, tax exemptions, and no currency restrictions but are generally restricted to doing business within the Free Zone and internationally. Offshore companies are essentially set up for managing business and assets internationally and have no physical office in the UAE.
Determining the Legal Form of Business
Decide on the legal form of your business, which could range from a sole proprietorship to a Limited Liability Company (LLC), Private Shareholding Company, or branch of a foreign company, among others. The chosen legal form determines the rules regarding governance, ownership, and operations.
Trade Name Registration
Register a trade name for your business that is unique and indicative of your business activity. The trade name must adhere to the UAE’s naming conventions and regulations.
Initial Approval and Legal Documentation
Obtain initial approval from the Department of Economic Development (DED) or the relevant Free Zone Authority. This step involves submitting a business plan, copies of passport for the owners and managers, and sometimes a No Objection Certificate (NOC) from the current sponsor if applicable. You will also need to draft and sign the company’s Memorandum of Association (MOA).
Office Space and Address
Secure an office space as it’s a legal requirement for company registration. In the UAE, the physical address of your business is necessary to proceed with the registration process. Some Free Zones offer flexible office solutions like shared desks or virtual offices.
Obtaining the License
Apply for the business license pertinent to your business activity. The main types of licenses are Commercial, Professional, Industrial, and Tourism. The specific license you need depends on the nature of your business activity.
Final Approvals and Collecting Business License
After submitting all required documents and receiving approvals, you will receive your business license. This license is crucial as it allows you to conduct business legally within the UAE.It’s also important to note that UAE business laws and processes can be complex, and it is advisable to consult with legal and financial advisors familiar with UAE business laws to guide you through the process. Additionally, staying updated with the regulations is crucial as they can change. With the right planning and guidance, setting up a business in the UAE can be a streamlined process leading to a prosperous endeavor.
