What are the Steps to Get Your Company Set Up?
An increasing number of businesses are entering Dubai, as company formation is fast with many strong incentives. Businesses benefit from incentives that include 100% company ownership, 0% corporation and personal tax, no currency restrictions, 100% import and export tax exemption, and 100% repatriation of capital and profits.
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You might be one of those business looking to enter the Dubai market, but are held back by the flood of information from numerous resources available online. Yet, the process of setting up a company in Dubai isn’t as difficult as you’d think. We’ve put together a simple step-by-step guide for you to make sure that you aren’t diving in blind.
1. Choose a business activity
Factors that should influence your decision include:
· Whether or not you’re setting up in a free zone, as some free zones only allow certain types of activity (e.g. media, medical, transport)
2. Choose a jurisdiction
There are three different economic zones in the UAE market – Mainland, Offshore, and Free Zone. Each jurisdiction has its own regulations and laws when it comes to setting up a business, and suit different business needs.
3. Finalise the company’s structure/legal form
The legal form for your company will serve as the layout and guide for how you should organise your assets and resources. Your company’s legal form is necessary to apply for a business license.
Here are some of the company structures/legal forms that your business can be registered as in the UAE:
· Limited liability company (LLC)
· Civil company
· Sole establishment
· GCC company branch
· Local company branch
· Free zone company branch
· Foreign company branch
· Holding company
4. Get the company name and activity approved
Your company’s trade name and selected business activity must then be approved by the Department of Economic Development (DED) before you can move on to the next step of the process.
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5. If necessary, find a local agent
Previously, starting a company in Dubai required you to have a local partner. A business setup consultant can help entrepreneurs to connect with companies that offer corporate sponsorships where you would be given 100% ownership of your business and documented authority.
6. Rent an office
You might choose to rent an office unit or a shared area in a business centre, depending on your business needs. The number of work visas that you can request from the DED can also be determined by your office space.
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7. Get the tenancy contact and Ejari
There is the possibility that you might need an Ejari. This is a tenancy contract that’s an agreement between you and the real estate agency that you’re intending to rent your workspace from. Ejari is an online system that’s taken care of by the Real Estate Regulatory Agency (RERA) in order to make sure that there is transparency and fairness between both parties involved in the tenancy.
To activate your Ejari account, you’ll need to submit your tenancy contract as well a few other documents. Your Ejari is important as it can prove necessary to obtain or renew family or work visas.
8. Get initial approval
Before getting the business license that you need in order to start operating, you’ll need initial approval from the DED. This approval states that the UAE government isn’t opposed to you starting a company in the UAE, and it’s absolutely crucial that you have it before the next step.
9. Get external approvals
Depending on your business activity, the DED might request some additional approvals from other agencies (both governmental and non-governmental).
Some business for example might need to get approvals from specific banks, embassies, or municipalities, etc.
10. Apply for a trade license
The trade licenses (also called business licenses) available in the UAE are:
· Industrial license
· Tourism license
· Commercial license
· Professional license
You can apply for these if you’re planning on starting a company in the UAE mainland, but in free zones the licensing structure is different and will depend on the business activity that your company has chosen.
11. Prepare your Memorandum of Association
A Memorandum of Association (MoA) is complex, and it’s important to understand its intricacies. Make sure that you get expert advice on this, as it needs to be drafted in accordance with the UAE government’s mandates as well as your business interest.
12. Register the company
Registering and licensing your company happens at the same time, but the process of documentation and getting approvals takes a few steps. At this point, you need to get all of the relevant approvals from the respective government authorities as per the requests of the Department of Economic Development.
Required documents are different based on company activity and type.
13. Collect your trade license
The following, along with necessary government fees, must be submitted to the DED in order to collect your trade license:
· Trade license application
· Memorandum of Association (MoA)
· Relevant government forms
· Initial approval certificate
· Trade name reservation certificate
· External approvals (where necessary)
· Tenancy contract
· Passport copies of partners
· Ejari registration certificate
· NOC for partners (where necessary)
· Any other requirements by the DED (if any)
Knowing the correct process of opening a business in Dubai and getting it right will save you a lot of time, effort, hassle, and money.
If this all seems a bit overwhelming, we’re here for you. At Startup Zone, we’ve streamlined the process of setting up a business in Dubai. We offer unbiased advice, transparent pricing, and competitive service fees. Starting a company in Dubai with us couldn’t be any easier!
Get in touch with us today for more info, or follow our social media channels for future posts with tips and advice on starting a business in Dubai.