Every businessman, investor, and entrepreneur dreams of starting a company in Dubai. It is due to countless benefits that this city offers such as a business-friendly environment, zero taxes, remarkable infrastructure, and much more.
A new business setup in Dubai, UAE is possible for anyone. You just need to follow a simple process to begin your firm in the UAE. This guide covers the detailed process that you need to follow in order to establish your company here. Read on to find out the steps to achieve your business goals.
4 Things to Consider for a New Business Setup in Dubai, UAE
Getting started with a new business in Dubai requires a few things to consider. Considering these things will help you easily set up your company and make your entrepreneurial dreams come true.
Every dollar counts because it can be costly to setup a new business in Dubai. A fixed budget is necessary for the company’s incorporation, stock inventories, hiring, hidden costs, licensing, advertising, and marketing. Even though expenses will always arise, planning ahead for them will enable you to gather a good amount of funds for sudden spending. Think large, plan for the future, and make sure your defined budget covers any capital-intensive opportunities and future growth.
2. Research Your Competitors
Research is a necessary component of every successful business out there. Make careful research on your competitors. Research deeply to discover if your chosen business is currently being conducted by someone else before moving forward with your planned activities. Look in the market and determine whether you can fill a specific niche or not. Or come up with a more effective method of satisfying a customer demand or resolving an existing issue. Also, whether there is a market opportunity for you or not.
3. Pick Ideal Business Structure
Picking the ideal business structure is extremely crucial. The best business structure for your company depends on a wide range of factors. With the assistance of a licensed company formation expert like RIZ & MONA, foreign firms wishing to conduct business in the UAE can create an ever-lasting and professional presence in the region.
Any foreign businessperson or entrepreneur can get their business license by:
- Establishing a free zone company
- Incorporating an LLC (Limited Liability Company)
- Forming a branch or representative office
We recommend you get in touch with business setup professionals in Dubai for advice. Experienced company registration agents at RIZ & MONA will examine your available business activities and advise the best course of action to enable you to trade and expand without any limitations. We will help you in conducting your business in accordance with the UAE authorized licensing agencies and Commercial Companies Law.
4. Craft a Detailed Business Plan
It’s crucial that you craft a solid business plan after researching the market and finalizing your proposal. A business plan is also an ongoing document that new enterprises should frequently assess in light of their overall business objectives and goals
Your business can be led in the proper direction if you have a sound plan. Not to add that banks and licensing agencies will both require a solid company strategy in the form of a detailed business plan.
Unluckily, a lot of fresh entrepreneurs and new investors skip this phase and can’t work properly to write their business plans. It’s critical to start out with a solid business plan in place.
Business Economic Zones in UAE
You must choose whether you want to operate in a free zone or mainland before you can setup a new business in UAE. All jurisdictions have advantages and requirements of their own. Let’s find out what each economic zone has for you to offer:
Business people should apply for a license and location in one of Dubai’s free zones if they want complete or 100% ownership of their business. The Dubai government worked on the idea of a free zone to attract foreign investors to open companies there.
In Dubai at the moment, there are about 30 free zones that are functional. Each free zone is often built around a specific industrial sector group and grants licenses to businesses that fall under those categories.
Dubai’s free zone is a unique economic region where entrepreneurs and investors can take benefit from 0% taxation and numerous ownership advantages.
One of the main drawbacks of running a business in any free zone is that direct business with the UAE market is not permitted.
The mainland is another important jurisdiction of Dubai. It is very beneficial to run a business on the Mainland. Your capacity to conduct business anywhere in the country, your freedom to choose your location, and your global reach, all help you build a significant presence in the UAE. It should be noted that you must get in touch with a native Emirati and must be listed as a substantial stakeholder when forming a company on the mainland. After all, when you run a company on the mainland, you can even work for the government and earn government contracts.
Offshore businesses are not a jurisdiction but a type of company that is slightly different from a free zone company. But it can be registered in a free zone as well gain access to many advantages of this economic zone. The business’s operations are the primary thing that separates an offshore firm from a free zone company. Businessmen can run businesses outside of the UAE only in an offshore company. Additionally, there is not any need for minimum capital deposits prior to business incorporation.
There is a drawback to an offshore company. In an offshore company, a sponsor is necessary that limits your foreign ownership to 49 percent and prevents you from operating as a free zone business.
Types of Business Licenses in Dubai, UAE
You are required to choose a proper license for your business in order to setup a new company in Dubai. In UAE, there are three main licensing categories for business setup.
Despite the fact that the Department of Economic Development (DED) issues all licenses in Dubai, some activities such as the sale of certain types of medicine and alcohol require permission from particular authorities.
The three main types of business licenses are:
Businesses dealing with the purchase and sale of commodities and products, or any other type of trade activity, require a Commercial license.
Manufacturing activities involving the mechanical or manual transformation of natural resources and materials into final products are covered by an industrial license. Paper manufacturing, textile manufacturing, and metal manufacturing are included in this license. Additional approvals may also be needed for certain industrial licensing activities.
Professional licenses are required for companies before entrepreneurs and businessmen can provide any kind of professional services to their clients. The license is issued after displaying the professional skills that you want to sell.
DMCC and other free zones in the UAE do not require a local sponsor to set up a business. By incorporating a company in a free zone, your company can have 100% foreign ownership without having any UAE locals as sponsors.
Process for New Business Setup in Dubai, UAE
The steps to start a new business in Dubai, UAE are as follows:
Step 1. Choose a Business Activity
The first thing to do is to choose a business activity. Do your research before choosing an activity. If you already have a plan for your company, it will be easy for you to select an activity. On the DED website, you will find more than 2100 business activities that fall under various categories and are legal in Dubai.
Step 2. Choose a Business Name
The next step is to select an appropriate business name. When choosing a name, you need to keep a few rules in mind. Once selected, register your business name with the DED.
Step 3. Find Investment
Find a source of investment for your business as you have to deposit a minimum share capital. But most business does not require to deposit of minimum share capital.
Step 4. Select a Jurisdiction
Post that, you need to choose an economic zone. You can either choose the free zone or the mainland. Choosing the jurisdiction totally depends on your business requirements and goals.
Step 5. Obtain Initial Approvals
Then, you need to apply for getting initial approvals. Simply submit the application along with the required documents to obtain initial approvals for setting up your company in Dubai.
Step 6. Find an Office Space
You will also require to find office space to operate your company. You will need to look for a location in your chosen economic zone. Without an office space, you cannot conduct business activities, or at least it will be very hard for you to do so.
Step 7. Submit Documents to Authorities
Last, you will submit all the required documents and paperwork including your company registration application to the relevant government bodies to get final approval to get going with your business
Step 8. Open a Bank Account
As soon as you’ve received approval and all the necessary documents, you can move ahead to open a bank account in any bank. You can open an account in the local and international banks available in the UAE. Some of these include:
- Commercial Bank of Dubai
- Abu Dhabi Commercial Bank, and more.
Required Documents for New Company Setup in Dubai
Your business type will determine which documents you’ll need to provide, but they generally include:
- Filled business licensing and registration form
- Feasibility study of the project
- Copy of your ID and passport
- The company’s articles of association
- Copy of your visa or residence permit
Cost of New Company Formation in Dubai
The cost of new company registration in Dubai varies from case to case. It also depends on several factors which are:
- Business setup consultants in Dubai, you opted for
- Your chosen business activity
- Your business’s location
- Visa and other related requirements
- The scale of your business and more
Reasons to Start a New Business in Dubai
Dubai welcomes new investors and fresh entrepreneurs as one of the most major emirates with a strong international reputation. Anyone, whether they are an amateur or an established businessman, would nearly always choose to open a new company in Dubai. It is due to countless reasons out of which some are:
- World-class infrastructure
- Setting up a business is easy
- Business-friendly laws
- Lets you hire non-native workers
- Zero tax policy
- Technological and industrial development
FAQs – Frequently Asked Questions
What is the business setup process in Dubai, UAE?
The business setup process in Dubai, UAE involves the following steps:
- Select your license type and business activities
- Apply for a business license
- Submit your documents to the relevant department
- Choose a location for your office
- Obtain your business license and get started with your business
Can a business be set up in the UAE without a local office?
No, it is mandatory to own a local office to set up a business in Dubai, UAE.
What is the minimum number of days required to start a business in Dubai?
Setting up a business in Dubai takes around 4-5 business days. But, the timeframe depends on a few certifications and factors linked with the company’s establishment.
What are the Licenses Types to Start a New Business in Dubai, UAE?
Three types of trade licenses exist that you need to start a new business in the UAE. The types depend on different business activities which are:
If you operate an industrial or manufacturing business, you will need an industrial license
A commercial license for trading
For professional services, a professional license is required
How to start a business in Dubai?
Here are the key steps to set up a business in Dubai:
- Choose a trade name or business name
- Decide on a legal structure
- Apply for a business license
- Decide on an office location
- Obtain preapprovals, register your business, and obtain your license
Consult Riz & Mona for Your New Business Setup in Dubai, UAE
Dubai makes for businessmen it easy and fast to launch a business. Company formation experts at RIZ & MONA assist you in forming a company in a free zone or mainland. In terms of legit recommendations for company formation in Dubai and the United Arab Emirates, RIZ & MONA have a track record of success.
We provide you with professional support to assist you with company formation in Dubai and other company registration-related services in the UAE through our highly qualified business setup experts. We provide comprehensive company setup services for everything as a one-stop shop that a new company in the UAE requires.
We set up businesses in all economic zones with exceptional results. We make sure to walk you through each step from beginning to end, making the process of business setup in Dubai clear to you. Our consultants support you, make your life simpler, and help you live your dreams. Contact us now and book a free consultation with our experts.