Do’s and Don’ts of starting new business in Dubai, UAE
Dubai has become the international hub of trading and due to its liberal trading policies it warmly welcomes the investment from around the world. Investment in Dubai is highly encouraged by the government of Dubai and this is one of the reasons why everyone is interested in investing in a politically stable and government backing environment for conducting business. Liberal trade policies make it easier for investors around the globe to start their business however, when the time comes it involve carefulness and vigilance to setup your business. You need to carefully research and start your business possibly with the help of professional like Riz&Mona consultants because one wrong decision and misunderstanding to business laws may cause loss in future. Here are few basic Do’s and Don’ts before you start a new business in Dubai.
Understand the difference between free zone and mainland
Before you start you enterprise you first need to understand the difference between different jurisdictions. Dubai government has divided its territories for conducting business, one is mainland and other is Free zone. Both have their own merits and drawbacks. Both have different rules and regulation when it comes to conducting business. You can start you company in free zone without having help form local sponsor but in order for you to setup a company in mainland you need to have a local sponsor. For details regarding free zone and mainland.
Research and Research more
In order to start your business venture you must do research and more research, the more you learn about the people and the culture you may be able to decide better.
Choose a jurisdiction
After carefully studying you need to select your desire location and jurisdiction for your business. To do so you can seek professional help. Choose your location carefully as it will have impact on your future business. Before you choose you must consider your business plan and investment. You also need to consider the kind of ownership you want in your business.
Eligibility and Visa requirement
Dubai welcomes people and businesses from around the globe. If you are starting your business in mainland you need to get the visa through your local sponsor. For the free zone you can do it yourself.
Business setup process is quite extensive and lot of paper work is in order so it’s better to get help from professional business setup agent like Riz&Mona consultancy. Help from professionals like us will get you through this processes easily. With deep understanding of business models and have a hold on dealing with the local bureaucracy you will be able to setup your desired business smoothly.
Don’t Rush when it comes to setting up a new business in Dubai. You need to carefully plan your every move. One simple step into the wrong direction may cause you immense loss in future. Don’t rush into anything before knowing at least maximum benefits and restrictions. It is very important to think through and then decide.
Don’t rely on information only
Don’t rely; it is very important for you to get the firsthand knowledge instead of only the published information. You must pay visits to different offices and sites and to meet different peoples before reaching out to a final decision. Sometimes rules changed but published later therefore its better to get consultation. (We can put Riz&Mona contact info here)
Don’t sign deals and sponsorship without legal written agreement
Don’t sign deals and sponsorship with local sponsor when starting a new mainland company. It is important that all of your agreements and deals with the local sponsor must be in written form and are notarized. Local sponsor by law is allowed to have 51% of your business when setting up company in mainland and is eligible to annual fee. Don’t sign anything unless both parties are agreed upon terms and conditions. Don’t rely on verbal consents in these matters.
Don’t choose business license without confirming
Don’t choose business license without confirming the type of activities allowed under that particular license. Getting a business license is sometimes very easy however, it is very important to understand what type of business activities are allowed under that license. Sometimes one license is only allowed to use for only one trade activity and sometimes multiple activities are allowed. You need to know before you get the license if the activity you are going to undertake is allowed under the license and what are limitations. What extent you can go to under that business license.
Don’t start a free zone company before checking pre-conditions
Don’t start a free zone company before checking pre-conditions. Sometimes free zone appeals but with a lot of benefits including full ownership and optimized tax solutions there are some restriction like you may not allowed to conduct business and sometimes sell your product outside of free zone. Therefore before starting your business in free zone you must make sure that they business you are going to initiate may not get affected by the limitations in free zones.