In Dubai, you can establish three primary types of companies:
- Mainland Company: Operates within the UAE and internationally. Requires a local sponsor who holds 51% ownership, except for certain professional services.
- Free Zone Company: Offers 100% foreign ownership, tax exemptions, and simplified procedures. However, businesses are generally restricted to operating within the free zone or outside the UAE.
- Offshore Company: Typically used for international business activities. Cannot conduct business within the UAE and does not need a physical office. Ideal for companies focused on asset protection or holding assets.
Business setup in Dubai involves several key steps:
- Choose Your Business Activity: Determine the specific activity your business will engage in.
- Select a Business Structure: Decide on the legal structure of your company (e.g., LLC, sole proprietorship).
- Reserve a Trade Name: Choose a unique and appropriate name for your business.
- Obtain Initial Approval: Apply for initial approval from the relevant authorities.
- Prepare Legal Documents: Gather necessary documents such as passports, visas, and business plans.
- Lease Office Space:Secure a physical office space that meets regulatory requirements.
- Apply for Business License: Submit your application for the appropriate business license.
- Obtain Visas: Apply for investor and employee visas as needed.
- Register with Authorities: Complete registration with the Department of Economic Development (DED) or relevant free zone authority.
- Open a Bank Account: Set up a corporate bank account for your business operations.
The timeline for setting up a business in Dubai can vary:
- Mainland Company: Typically takes 1 to 4 weeks, depending on the complexity of the business and the completeness of documentation.
- Free Zone Company: Generally can be set up within a few days to a week.
- Offshore Company: Usually faster, often completed within a few days.
Common documents needed include:
- Passport copies of shareholders and managers
- Proof of address
- Business plan
- Memorandum of Association (MOA)
- Trade name reservation certificate
- Tenancy contract (Ejari)
- Visa copies (if applicable)
- Bank reference letter
- No Objection Certificate (NOC) from the local sponsor (for mainland companies)
Yes, for mainland companies, a local sponsor (UAE national) is required to hold 51% of the company's shares. However, for certain professional services, the foreign investor can retain 100% ownership. Free zone and offshore companies allow 100% foreign ownership without the need for a local sponsor.
The cost of setting up a business in Dubai depends on the type of company, the business activity, and the location. For a free zone company, costs generally include registration fees, license fees, and office space rent. Mainland companies may have additional costs for obtaining a local sponsor or partner. Costs can range from a few thousand to tens of thousands of dirhams, depending on the size and scope of the business.
Dubai offers numerous advantages for businesses:
- Strategic Location: Acts as a gateway between the East and West.
- Tax Benefits: Low or zero corporate and income taxes in many zones.
- 100% Foreign Ownership: Available in free zones and offshore companies.
- World-Class Infrastructure: Modern facilities and connectivity.
- Business-Friendly Environment: Supportive government policies and regulations.
- Access to Skilled Workforce: Availability of diverse talent.
Yes, opening a corporate bank account in Dubai is a standard part of the business setup process. Requirements vary by bank but typically include:
- Company trade license
- Passport copies of shareholders and managers
- Proof of address
- Bank reference letter
- Business plan
- Tenancy contract (Ejari)
Dubai offers several types of business licenses:
- Commercial License: For trading activities.
- Professional License: For service-oriented businesses.
- Industrial License: For manufacturing activities.
- Tourism License: For travel and tourism-related services.
For most businesses in Dubai, having a physical office space is a requirement. However, this depends on the business structure you choose:
- Free Zone Companies: Some free zones offer options like flexi-desk or shared office spaces, making it easier to operate with minimal office requirements.
- Mainland Companies: A physical office is typically required to obtain a business license from the Department of Economic Development (DED).
- Offshore Companies: Offshore companies do not need a physical office in Dubai as they are used primarily for international operations, not local trade.
Yes, many aspects of the business setup process can be handled remotely, especially for free zone and offshore companies. Mainland companies may require the presence of the investor for certain procedures. It's recommended to work with a business setup consultant who can guide you through the process and handle documentation on your behalf.
The standard working hours in Dubai for most businesses are from 9:00 AM to 6:00 PM, Sunday to Thursday. Friday and Saturday are considered the weekend. However, working hours may vary depending on the type of business or location. Some businesses in specific sectors may operate with different hours or follow international time zones for global operations.
Yes, for most mainland companies, you will need a local partner (Emirati) who owns 51% of the company. This applies to many business types unless it falls under certain professional services, where you can retain full ownership. However, for free zone and offshore businesses, full foreign ownership is allowed, meaning you do not need a local partner.
Yes, you can register multiple activities under the same business license, provided that the activities are related. For instance, a company can have both a trading and consultancy activity under one commercial license. However, there may be additional fees or conditions depending on the licensing authority. It’s always advisable to consult with a business setup consultant to understand the rules for your specific activities.
Yes. You do not need to be a UAE resident to set up a business in Dubai. Foreign nationals can set up businesses in Dubai, especially in free zones and offshore locations, without needing residency. However, if you are setting up a mainland business, you may need to secure a residence visa as part of the setup process. Free zone companies typically offer a residence visa as part of their setup package.
Yes, it is possible to transfer your business to Dubai from another country. The process involves legal procedures such as obtaining necessary approvals, submitting business documents, and registering with the appropriate authorities. Depending on the type of business and its location, you may need to meet additional requirements such as local sponsorship or office space. Many free zones also offer attractive options for businesses looking to relocate.
After setting up your business, you will need to meet certain compliance requirements, such as renewing your business license annually, maintaining accurate financial records, and filing VAT returns (if applicable). Businesses in Dubai must also adhere to labor laws, which include having valid employment contracts for employees and paying into the UAE’s social security system.
Non-compliance with Dubai’s business regulations can lead to penalties, fines, or even the closure of your business. It is essential to comply with all local laws, including tax regulations, labor laws, and business licensing requirements. Staying up to date with compliance is crucial, and it's recommended to work with local experts or consultants to ensure your business adheres to all rules.
Business owners and employees require a residence visa to live and work in Dubai. The requirements vary based on the type of company:
- For Free Zone Companies: Business owners and employees can be sponsored for residence visas through the free zone.
- For Mainland Companies: You will need to apply for a visa through the relevant government authorities. The number of visas allowed depends on the size of your office and the number of employees.
Yes, certain business activities are restricted or require special permits in Dubai. For example, businesses involved in sensitive industries like banking, insurance, and healthcare require specific approvals and licenses. Additionally, businesses in mainland Dubai may be subject to regulatory oversight based on the nature of the activity. It’s important to consult with a business setup advisor to ensure your activity complies with local regulations.
You need to renew a business licenses in Dubai annually. To renew your license, you must:
- Ensure that your business is in good standing with local authorities.
- Submit your renewal application to the relevant department (DED for mainland, free zone authority for free zone companies).
- Pay the applicable renewal fees.
- Provide updated documentation, including tenancy contracts and visa renewals.
The Dubai Chamber of Commerce and Industry (DCCI) is a key government body that supports businesses in Dubai. It offers various services, including:
- Issuing certificates of origin for exported goods.
- Providing networking opportunities.
- Offering business advisory and training services.
- Supporting international trade and investment.
Yes, you can hire employees for your business in Dubai. You will need to comply with UAE labor laws, including providing employment contracts, health insurance, and other employee benefits. For free zone companies, the process may be simpler, and you can sponsor visas for your employees. Mainland companies must follow the same procedures but may have additional requirements for visas and labor compliance.