When it comes to doing business outside of your native country, Dubai is the best place that you should choose. Though a well-established business in Spain can give you some bucks, moving that business to Dubai, UAE will help you in scaling your profit to an unimaginable amount. Plus the benefits and perks the city offers to business owners are simply out of this world.
If you are doing business in Spain and thinking of shifting to the Emirates, this is the right time. Here is a complete guide that will teach you how you can move your ES business to Dubai, UAE without making any mistakes.
Table of Contents
Problems of Doing Business in Spain
Some of the major obstacles on your way to conducting business in Spain are:
Consumer spending has reached a five-year low, and household savings have increased due to which the economy has slowed. According to the IMF, Spain’s internal political divisions, global protectionism, and a decreased interest in foreign investment are the main reasons why this downturn is expected to last for some time. For the next few years, domestic demand is anticipated to lead to growth.
Difficulty in Starting a Business
According to the World Bank and International Finance Corporation, Spain is ranked 136th in the world for ease of business startup. For multinational businesses, the ten procedures and multiple stages for starting a business might be extremely intimidating. For instance, executing a public deed of incorporation in front of a public notary or obtaining a certification of uniqueness are exceptional requirements.
Handling the Bureaucracy
Although the Spanish government is quickly equipping digital technologies, there are still several administrative barriers to starting a business and conducting relevant operations in the country. So much paperwork and stamps we need to collect from the correct agencies in the proper order makes it hard to handle the bureaucracy. For instance, the process of establishing a foreign company’s subsidiary in Spain typically involves 14 different authorities and takes 4 to 6 weeks to be completed.
17 Autonomous Regions
Spain is split into 17 autonomous regions. It is thought to be the most highly developed country in all of Europe. Confusion and delays may result from each of the regional government’s lack of coordination, which can make conducting business in Spain more difficult. It takes a lot of time to have a look at the region you want to do into because your regulatory, tax, and necessary financial information requirements may change depending on what part of Spain you’re operating in. And this makes it hard to do business in the country.
Although Spain’s current national employment rate has reached its highest level since the global financial crisis in 2008, it has not yet returned to the levels seen prior to 2008. In 2018, Spain’s unemployment rate was over 15%, compared to 8.2% in 2007. At an average rate of 6.3 percent, that is the second-highest unemployment rate in the EU. Only Greece, a country that has battled with significant debt and unemployment for more than 10 years, ranks ahead of Spain in this category. For young employees, the unemployment rate in Spain is much higher: 31.7% for those under 25.
Understanding the Concept of Time
There is nothing you can do to speed up the time it takes to set up a business in Spain—it definitely takes longer than your expectations. You should go elsewhere, such as the UAE, to establish your business if your business plan includes strict time constraints.
Corruption and Bribery
Bribery and corruption are other reasons that make it difficult to do business in Spain. Spain is placed 35th globally at the end of 2022, down four spots according to the 2021 Corruption Perception Index.
Recent surveys of public opinion in Spain reveal that 94% of people are very much concerned about corruption. Recent years have seen a high number of media coverages of high-profile corruption scandals and organized crimes.
Dealing with Construction Permits
Doing construction business and getting a building to set up the headquarters of a company in Spain is not a piece of cake. Obtaining a building permit takes 182 days and includes obtaining a number of certifications and inspections. Before the building registration is finished and the property is equipped with water, power, and telecommunication facilities, businesses could additionally need to secure an operating license.
Language issues in Spain
The fact that most people don’t speak Spanish fluently and that few Spanish people do speak decent English or other languages is probably the biggest obstacle to doing business in Spain.
Of course, the majority of Spanish speakers under the age of 40 will have some knowledge of English. Some people do exceptionally well; they probably work in London or New York. However, speaking in Spanish is needed when dealing with complicated legal and corporate concerns.
Finding the right local partners
Dependable partners, advisors, and suppliers are required to conduct business in Spain. As discussed earlier, language and cultural barriers can cause misunderstandings and make the selection process more challenging. The majority of foreign companies that fail in Spain do so due to (misguided) expectations, cultural differences, and shareholder disagreements.
Even if you understood what was being said, terminology like “agreement,” “quickly,” and “excellent” might not have the same meaning in every culture
Benefits of Doing Business in Dubai
Dubai has achieved recognition on a global scale as the Middle East’s economic center. Due to its advantageous geographic location, it is simple to connect to suppliers in the African continent, Asia, and the Gulf. Moreover, 90% of the city’s residents are foreign nationals.
A highly favorable environment for entrepreneurs to succeed is also created by Dubai’s tax-friendly policies, superior infrastructure, secure living conditions, and visionary leadership that encourages technology and innovation. As a result, moving a business to Dubai gives you the chance to live in such a prosperous location.
Dubai has turned into a major trading center with numerous commercial options. There are several benefits of the participation of foreign businesspeople in the city’s thriving economy are there including the following:
- There are more than 66 international agreements to prevent double taxation with significant corporations.
- Dubai is in a prime location, acting as a bridge between Asia and Africa.
- The city has world-class seaports and airports for trade with Asia and the Middle East.
- Currency exchange restrictions are not in place.
- Corporate taxes, withholding taxes, import or export taxes, and capital gains taxes are not applicable to businesses in Dubai
- 100% foreign ownership is possible in free zones.
- The economy is very diverse. Dubai no longer depends on its natural gas or oil deposits; instead, it prospers in industries like innovation, trade, tourism, and transportation.
- The government of Dubai is business-friendly. The Department of Economic Development (DED) was established to assist in the creation of firms and provide financial support for commercial activities.
- Dubai is an excellent area to live and work in because it has a low crime rate.
- Businessmen have the choice to conduct business in the Free Zone regions.
- Trading opportunities exist on the Mainland without regard to barriers of geography.
Documents Required to Setup an ES Business in Dubai, UAE
The following documents must be submitted during the process itself before you can move forward:
- Completed visa application
- A set of color photographs
- Brief description of intended business activities
- Ticket details
- Details on the purpose of the visit
- Articles of incorporation (if required)
- Business plan
- Security amount
- Bank statement
- Passport copies for all shareholders
How to Move ES Business to Dubai, UAE in Easy Steps?
Now that you are somewhat familiar with the negative points of doing business in Spain and the positive sides of moving that business to Dubai, you are good to shift your business to the Emirates. Here is the complete process to do so:
Step 1. Business Structure
See what is the business structure of your company. Your company’s structure is determined by the business activity.
A sole proprietorship enables you to run your business as the only owner. A limited liability corporation (LLC), enables you to have a distinct legal structure and is the most typical business structure in Dubai. Determining business structure is important as it will be required in registering your business in Dubai.
Step 2. Register the name of the Business
One of the most crucial steps in moving a firm is to register the name of your business. You can either choose the current name of your business or decide on a new one. But you need to be aware of several regulations in Dubai. For instance, the name of your company must be distinctive—it cannot be the same as one that already exists in Dubai. Moreover, no offensive or blasphemous terms are allowed in the company name.
Plus, if you want your name to appear in the company name, it must be your whole name, first and last. Just an initial or abbreviation is not allowed.
Step 3. Location on Dubai Free Zone or Mainland
You can establish a business in Dubai either on the mainland or in one of the several free zones. You might wonder whether a free zone or the mainland is the better place for your company. The answer to this question will vary depending on your unique situation and the kind of business you want to launch.
Here are the main differences between the mainland and the free zone.
Running a business in Dubai Mainland enables you to do both domestic and international business. The process of forming a company is very organized. Here the business license can also be obtained in a single day.
Free zones make business setups affordable and advantageous for foreign startup companies. Dubai Multi Commodities Center, Jebel Ali Free Zone (JAFZA), Dubai Media City, Dubai Silicon Oasis, Dubai Healthcare City (DHC), Dubai International Financial Center (DIFC), and Dubai Airport Free Zone (DAFZA) are some of the most well-known free zones in Dubai (DMCC). However, because each free zone is administered by its own authority, the rules and regulations for companies and the timeframe for the formalities of business setup may differ from one free zone to another.
Step 4. Find a Local Partner
You will want a local sponsor if you decide to set up your company on the Dubai mainland. The majority of the ownership in your business will be held by the sponsor. If you intend to establish your business in a Free Zone, you can skip this step.
Step 5. Get Initial Approval
Then, submit your business registration application and supporting documents to obtain initial approval.
Step 6. Draft your Memorandum of Association
The company’s external operations are governed by the Memorandum of Association (MOA), which is a legal document. This must be notarized in a Dubai court.
Step 7. Make payment
You will receive a payment voucher once all of your documents have been submitted. You have 30 days from the time you receive the payment voucher to make license payments.
Step 8. Obtain a License
To move a business to Dubai, you must obtain a business license. The DED or the relevant free zone authorities can be contacted directly for a trading license.
Step 9. Obtain Your Visas
A business visa makes it easier for a company to travel within and outside of the UAE. Also, it enables three of the senior company employees to submit a residency application. A long-term visa for themselves and their dependents is available to anyone who desires to move a business to Dubai. By contacting the regional embassy, you can obtain a visa. In addition, anyone who wants to go to the UAE in order to start a business is qualified to apply for a business visa.
Making sure your visa is in place is a crucial step that must be finished before the company can begin to operate. The UAE offers a variety of visas, and permission can be obtained in no time with an extremely simple application process.
As a business owner, if have a business license, You have the right to sponsor the visa applications of individuals, such as family or employees. But, keep in mind that if you are requesting visas for dependents, the number of visas you are qualified to apply for depends on the structure, profits, and size of your company.
Step 10. Open a Bank Account
Opening a bank account is also a crucial step in the process of moving a business. Although there are several banks in Dubai that offer business banking services, opening an account is challenging for foreigners due to the UAE’s strict anti-money laundering regulations. But, banks are becoming more accommodating, and there are many advisors available to support you.
Step 11. Business Registration and Incorporation
After completing the above-mentioned steps, you can register your business with the relevant authority and begin carrying out operational operations in the UAE. To register, you would need to get all of your paperwork and prepare it for submission, including bank accounts, identification documents, trade licenses, and confirmation of your identity. After registration, your company in Dubai becomes a legal entity.
Types of Trade Licenses
All business licenses are issued by Dubai’s Department of Economic Development (DED). According to your type of business, you can select from the following four different types of business licenses:
Companies engaged in commercial activities and trade in the United Arab Emirates are granted a commercial trade license, the most popular type of license on Dubai’s mainland. Your business activity, like General Trading, may include re-exporting, importing, and trading allowed commodities and goods. Some examples of operations covered by this kind of trade license include the sale of automobile accessories, food and drinks, and leather goods such as handbags.
A professional trade license from Dubai DED can enable you to launch a business in Dubai if you are a qualified professional with a particular area of expertise. Companies that are profit-making and have a service-oriented business model are given a professional license.
Consultancies, management services, educational and training enterprises, technical services, beauty parlors, healthcare and medical services, printing and publishing, accounting and auditing, and many other business activities fall under this category. There are times when business activity is regarded as both professional and commercial. So, it is important to seek the advice of a company set-up advisor to avoid complications.
Industrial activity is the activity of any enterprise that creates new products by processing raw materials derived from natural resources or manufactured by humans. The finished product might be made mechanically or manually. Thus, a Dubai industrial trade license from DED is necessary.
Manufacturing industries including those that produce cement, fiberglass, meat, bread, food goods, textiles, and machinery and engines are just a few examples of the many businesses that fall under this category. It’s also crucial to remember that all businesses with this kind of license are required to have a real warehouse in the UAE.
The tourism trade license is also issued by the DED to businesses related to tourism in Dubai. Marine tour operations, outbound and inbound tour operators, hotel apartment rentals, travel agencies, and vacation home rentals are just a few of the enterprises that must apply for a tourism trade license. Travel and tourism are currently one of the fastest-growing industries in the UAE due to the enormous growth in tourists in Dubai alone over the past ten years.
Can a Foreigner Start a Business in Dubai?
Simply said, yes, a foreigner can start a business in Dubai. Dubai is home to a population that is highly diverse and consists of individuals from all over the world. The government aggressively encourages investors and business owners from outside the UAE to move their businesses here.
This indicates that there aren’t many limitations on what foreigners can do when it comes to launching a business in Dubai.
Entrepreneurs may run into difficulties when moving a business in Dubai, particularly if they are from outside the UAE and may not be familiar with their procedures.
Business setup experts like RIZ & MONA CONSULTANCY can assist in this situation. They can walk you through the procedure and make sure the company is ready for business in a short period of time.
FAQs – Frequently Asked Questions
Why Move Your ES Business to Dubai, UAE?
There are multiple reasons to move your Spanish business to Dubai, UAE including:
- Corruption and bribery
- Difficult to set up a business
- Things take a lot of time
- Hard to get licenses and permissions
- Language barrier
Is Dubai a Good Place for Business?
Dubai is an excellent place to do business. The business-friendly tax policies, environment, excellent infrastructure, and business-supportive government rules and regulations make it an awesome place to do business.
Is it OK to start a new business in another emirate?
Yes, it is fine to start a new business in another emirate but make sure to know the rules and regulations along with the market situation of that place.
Move Your ES Business to Dubai with RIZ & MONA CONSULTANCY
There are all the right reasons to shift your company to Dubai from Spain. The process to move your ES business to Dubai, UAE is very easy to follow. Follow to go through the above-mentioned steps and you can easily set up your business in Dubai. If you have any doubts, you can reach out to RIZ & MONA CONSULTANCY, a well-known business setup consultant in Dubai, UAE.
Our experienced business advisors will guide you in the right way to move your company from Spain to the UAE. We can handle your process and take control of everything on your behalf to save you from the hassle. Contact us now to book your free slot and get going with your business in the Emirates.