Types of Business Licenses in Dubai, UAE
In terms of jurisdictions, there are two common types of business licenses available to USA entrepreneurs to set up a business in Dubai. The first is a free zone license. This is most likely the most cost-effective and easy way to start a business as a US entrepreneur in the UAE.
You can benefit from no restriction on currency, 100% customs tax exemption, and 0% corporate tax, depending on the free zone where your business is established.
The other option is to start a business on the mainland. The mainland license lets you open a business anywhere in this region. But you may need to work with a local sponsor for trading in the country.
In terms of business activities, there are primarily four types of business licenses around the UAE.
- Tourism license for the tours and travel industry
- Commercial license for general trading businesses
- Industrial license for manufacturing goods
- Professional license for service-related businesses
The initial stage to set up a business in the country is to get a business license. But it is also important for you to learn about various jurisdictions and agencies that are responsible for managing the business licensing system.
Required Documents to Get a Business License in Dubai
The process to get a business license in Dubai is straightforward. Different business activities and jurisdictions have their own respective licensing demands. But for those who opt for a mainland license in Dubail, they need to submit the following documents. Keep in mind that you need to submit these documents to the DED.
- Copies of passports of business managers and partners on the basis of the requirement of the business activity.
- The Ejari and the tenancy contract for the office space.
- A NOC from the company’s sponsor for your foreign partners or ex-pat investors.
- Copies of the residency visa for every business shareholder or partner.
- External approvals and initial approval from the DED are to be submitted with the business registration application.
- After submitting the documents and paying the fees, the department will issue the license. Plus, one of your business partners must be present when applying for the license.
Benefits of Doing Business in Dubai as an American Entrepreneur
There are many benefits and rewards that come with doing business in Dubai for USA entrepreneurs other than ease of doing business in Dubai. No matter the format, here are some of the advantages of doing business in the UAE:
- Robust and safe governance
- A zero-tax regime; No corporate or personal income taxes
- A top-class financial hub
- Zero capital repatriation restrictions
- An educated supply of human capital with versatile professional experience belonging to different parts of the world
- There are no requirements for a physical office
- There are no requirements for share capital
- In comparison to other onshore jurisdictions, Dubai has lower set-up costs
Etiquette in the UAE to Do Business in Dubai
Before you begin to establish your company in a fast-moving, complex, and multicultural environment like Dubai, you need to look into the avoidable pitfalls of setting up a business here.
We will be dividing these things into do’s and don’ts:
Do Explore the Culture and Indulge Yourself in Local Traditions
Get used to the heat of the city, develop a tolerance for it, and appreciate all the positive things about it. Nobody will care about your complaints about the heat, which in the summertime may get very strong at 45 degrees. Plus, there is no benefit to complaining about it.
The city is a desert. So, there are numerous things to do including dune bashing and enjoying the breezy nights in the breathtaking scenery. Learn about the area and demonstrate concern for the local people’s welfare. Also, try to learn Arabic as it will help you in communicating with others.
Do Dress Right, Play Nice, and Smile
Although it is true that people living in Dubai are fans of brands, it should be highlighted that they have also grown to appreciate sophistication and subtlety. Dubai has deep Islamic roots despite having extremely Western characteristics. Combining these elements makes it obvious that, dressing smartly, stylishly, and modestly is essential regardless of being a man or a woman. For example, if you’re looking for a local sponsor, wearing a suit and a tie is essentially required for men attending meetings.
A key element of Dubai’s entrepreneurial, social, and even corporate tendencies is happy, positive energy. Nobody relocates here to spend their days in the darkness. So complete your look with a smile.
Do Deal with Locals in the Right Way
Understanding the right way to interact with local Emiratis is crucial when learning how to launch a business in Dubai. First of all, you should be aware that it is polite to show the highest respect throughout any introductions in meetings.
It’s important to be aware of proper etiquette when it comes to addressing people and socially interacting with them because you might not instantly know the ranks of the individuals in the meeting room. For example, always avoid shaking hands with the opposite gender unless they extend their hand first. And if they extend it, always use your right hand to do so.
In the end, take your time when it comes to dealing with business or commercial affairs. Even though you might be in a hurry, taking the time to ask someone how their day, health, and family are will be beneficial for you. The best thing to do is to wait for the other person to initiate the business conversation and to avoid using any European corporate bluntness. Small talk is a non-intrusive way of determining if someone would be a suitable business partner for you or not.
Do Get Out There
If you only do simple online transactions and email introductions, you might not be able to start a business in Dubai. Dubai is nothing but just about in-person meet-and-greets and networking events. Do visit those networking events, enjoy the drinks, talk to the people present in the room, and try to stay in touch with them after the event. Close personal relations are key because each particular industry has generally a small network.
To improve your client base and skills, you should make a maximum number of positive contacts. Also, word-of-mouth is extremely strong in the city.
That is why go to conferences, join groups, and attend networking sessions. Plus, keep your business card always with you and print it on one of the sides in the Arabic language.
Don’t Show Off About Your Achievements
Dubai is home to people that show off a lot. They pretend to have a lot and be the biggest things in the city. You should avoid doing the same and don’t boast about your achievements.
The city is now leaning towards quality over quantity, clean design, modern minimalism, and elements rooted in humility and taste. Thus, market yourself without using the tired Dubai cliches and by spreading different business collaterals, such as online event invitations or flyers.
Don’t Expect Negotiations and Meetings to Go Smoothly
The most valuable quality you can develop throughout your work and life in Dubai is patience. On some occasions, long meetings can be somewhat hectic. It is so because attendees may show up late to the meeting, proceed to change the topic, use mobiles during discussions, and join without announcing.
As you will be belonging to the American business environment, you can feel frustrated. But if you are patient and punctual as well, it will be very beneficial for you. A way of life in the city is to keep business in the family. So you might require to change the style and speed of your decision-making and the dynamic of your interactions with companies.
