Starting a business in Dubai, the trading hub of the Middle East and North Africa (MENA) region, promises a plethora of advantages for companies seeking success and global connectivity. In 2022, Dubai witnessed an impressive real GDP growth of 7.6%. Looking ahead to 2024, a forecasted growth of 3% underscores the city’s continued economic dynamism.
Notably, the UAE holds a commendable 10th position out of 153 nations in the GlobalData Country Risk Index, solidifying its status as a low-risk destination for business. This ranking reflects the stable environment Dubai offers, making it an attractive and secure choice for aspiring entrepreneurs to start a business setup in Dubai. Starting a business in Dubai can be a rewarding venture due to its strategic location, strong economy, and business-friendly environment. Now in this blog, ‘The Basics of Starting a Business in Dubai: What You Need to Know, we’ll discuss everything you need to know about starting a business in the heart of UAE.
How to Open a Company in Dubai – The Formation Process Your Step-by-Step Guide in 2024
Setting up a business in Dubai becomes notably streamlined with the assistance of our business setup consultants in Dubai Our team of experts simplifies the process, ensuring a smooth experience in creating a business account.
Key Steps To Start a Business
To set the stage for success in Dubai, consider these key steps :
- Select a business activity
- Select the jurisdiction
- Finalize the company structure/legal form
- Get the initial approval
- Apply for your trade license
- Register your company
- MOA-Court Attestation
- Get your external approvals
- Get the tenancy contact & Ejari
- Submission of all Documents
- Collect your trade license
-
Select a Business Activity
The initial step in starting a business in Dubai is choosing a suitable venture. Consider the practicality and relevance of your chosen activity in the UAE market. Before opening a company, thoroughly research its feasibility and profitability.
-
Select The Jurisdiction
The economic landscape of the UAE comprises distinct economic zones: Mainland, Free Zone, and Offshore, also referred to as jurisdictions. Each jurisdiction boasts unique laws and regulations for business setup, tailored to diverse business needs. Choosing the right jurisdiction depends on your specific business requirements and the nature of your business activity.
-
Finalize the Company Structure/Legal form
Selecting the legal structure for your company holds significance in the commencement of a business in the UAE. It establishes the framework for handling profits, losses, and the organization of resources. Determine your company’s legal structure early in the planning process to outline its framework. Securing a business license is important in finalizing your company’s legal form. Here are various legal forms to consider :
- Limited liability company (LLC)
- Sole Establishment
- Civil company
- Local company branch
- GCC company branch
- Foreign company branch
- Free zone company branch
- Holding company
-
Get Initial Approval
To start a company in the UAE, the Department of Economic Development (DED) needs to approve your business name and chosen activity. Once these get the green light, submit the required documents to apply for your UAE trade license and kickstart the process of opening your company in Dubai. In the case of a mainland company, the Dubai Department of Economic Development (DED) handles the approval process. Free zone and offshore companies, on the other hand, are subject to their specific regulatory authorities.
-
Apply For Your Trade License
Moving forward, your next task is to apply for trade licenses in the UAE. You have four options, referred to as business licenses, to choose from.
- Commercial License
- Professional License
- Industrial License
- Tourism License
-
Register Your Company
Registering your company and obtaining licenses happen at the same time, but it involves several stages. Every step is crucial. During this step, you must secure approvals from government authorities as per the Department of Economic Development’s requirements. Note that the required documents vary based on your company type and activity.
-
MOA-Court Attestation
For setting up a business in the UAE, you must submit a Memorandum of Association (MOA), which needs notarization by a Dubai court’s notary public. After signing and notarizing the MOA, apply for entry into the Commercial register at the Economic Development Department. It’s important to note that businesses wholly owned by non-GCC residents need a Local Service Agent from the UAE, requiring a formal agreement attested by either a notary public or a court.
-
Get Your External Approval
Depending on your business activity, the Department of Economic Development (DED) might require additional approvals from various government or non-government entities. For example, certain businesses may need approvals from the municipality, specific banks, embassies, and other relevant authorities as requested by the DED.
-
Get the Tenancy Contact & Ejari
When you begin your business in Dubai, you will require an Ejari. This contract is between you and the real estate agency from which you plan to rent an office or shared workspace. Ejari operates online under the Real Estate Regulatory Agency (RERA), ensuring fairness and transparency in the tenancy agreement. To activate your Ejari account, submit your tenancy contract and additional documents. Having an Ejari is crucial as it is needed for obtaining or renewing visas for your family members /or employees.
-
Submission of all Documents
Submit the remaining documents, including the MOA, AOA, lease agreement, and relevant licenses, to the respective authority for final approval and company registration. You will need to submit the list of the following documents. They include :
- Memorandum of Association (MoA)
- Trade license application
- Relevant government forms
- Trade name reservation certificate
- Initial approval certificate
- External approvals (if any)
- Tenancy contract
- Ejari registration certificate
- Passport copies of partners
- NOC for partners (if any)
- Other requirements by the DED (if any)
-
Collect Your Trade License
After successfully submitting all your documents online, a payment voucher from the Department of Economic Development (DED) is generated. Then the customers can collect the business license from service centers of the economic department. Lastly, all these should be submitted to the Department of Economic Development along with the necessary government fees.
