Description – Dubai has become a hub for doing business in the UAE, and the government has established a free zone for mainly foreign-owned enterprises.
As it is one of the most famous locations in the country, the city of Dubai needs no special introduction. We all understand Dubai’s status as a tourist destination, but it’s far more than that. Dubai, a fertile ground for new ventures, is the dream of every business person. It’s not just comfortable but also highly profitable to develop your business in Dubai. Before you kick start your company in Dubai, there are a few things you should be aware of.
Economic Zone and Ownership
The first step is to find out the business zone that suits your company once you decide to set up your Dubai business. To create their organization, one can choose from the mainland, free zone or offshore, giving various advantages. Here are the three leading jurisdictions available in Dubai –
Free zone Company Setup Dubai
Free zones are the most robust foundations of the stable economy of the UAE. They have successfully attracted considerable foreign investment, creating thousands of jobs and facilitating the technology safer to the region. These free zones are the most sought-after business areas in the UAE because of business-accommodating rules, simplified labor and immigration processes and tax structures.
Dubai alone is home to more than 30 free zones, significantly adding to the city’s economy. In 2015, free zones accounted for 32 per cent of Dubai’s overall direct trade, pushing trade to about AED 500 billion. Twenty thousand free zone firms were operating in Dubai as per 2015 data, with 100 ‘Global Fortune 500’ firms forming their JAFZA base.
Mainland Business Setup Dubai
An onshore company authorized by the Department of Economic Development (DED) of the associated emirates is a mainland company. Companies registered on the mainland of the UAE can, without limitation, conduct business in the local market and outside the UAE.
Offshore Formation Dubai
An offshore company is a foreign business organization that exists to reduce tax payments outside its registered jurisdiction legally.
Types of License
A commercial license is obtained to perform some form of business in the UAE. Charges can be split into three in Dubai;
- Commercial licenses for all forms of trade practices
- Professional licenses for trades, equipment, artisans and craftsmen
- Industrial licenses for the setting up industrial or development operations in the UAE, doing business without commercial consent is illegal and subject to penalties. Also, each year the claim has to be renewed.
In Dubai, starting a business starts with choosing the business category. More than 2,100 industrial, trade, technical and tourism activities are open for entrepreneurs and business persons.
It is followed by searching for the correct legal form, which will rely on the business operation, place, number, nationality of owners, and ownership possibilities.
It is essential to choose a trading name that corresponds to the kind of services the company provides.
The next step includes applying for an initial certificate of approval, indicating that you do not object to starting a company with Dubai DED.
A Memorandum of Association (MOA) had to be signed by the partners and owner, depending on the legal form of the company, and in some cases, a Local Service Agent (LSA) / Corporate Agent arrangement between the owner of the company and the UAE national in charge of representing the company.
In Dubai, all companies should have a physical address. For this reason, the tenancy agreement with the landlord must be signed and registered with Ejari.
Other than the one from DED, most business practices need special licensing approvals. If additional permits are required for your business operation, the appropriate government agencies need to be contacted.
Non-UAE nationals need to team up with a UAE national to create an agency in mainland Dubai. The UAE national will hold 51 per cent of the shares, and the remaining 49 per cent will be owned by the non-UAE national. But late, in some sectors chosen by the government, the UAE government announced a new law that will allow full foreign ownership.
Starting a business in the United Arab Emirates is a very lucrative choice and the best destinations for a foreigner to set up a business. If you are looking to set up a company in the UAE, you need the assistance of experts who can lead you in the right direction and, if possible, provide you with the right solutions to your dilemma. Commitbiz business consulting in Dubai is one such company. Advisors at commitbiz will provide you with relevant and accurate information and help set up your business when required.