Dubai is one of the world’s leading business destinations, with an advanced business environment and strong infrastructure, making it an ideal destination for investors and businessmen from all over the world. Setting up a company in Dubai offers great opportunities for growth and expansion, whether you want to start a small business or establish a large business. By facilitating government procedures and providing diverse business environments such as free zones, Dubai has become an attractive place for individuals and companies.
The first step to setting up a company in Dubai is to determine the type of business activity you want to practice, as each activity requires its own license. Whether you are considering setting up a business in the free zones or establishing a limited liability company (LLC) in Dubai, there are multiple options available that allow you to benefit from the economic and tax benefits that the emirate offers.
One of the main advantages that Dubai offers is that it does not impose corporate income tax on most commercial activities, which contributes to attracting many foreign investors. Dubai also has an advanced legal system that ensures the protection of commercial rights and provides a safe climate for investment.
The process of establishing a company in Dubai requires preparing a set of documents and adhering to legal procedures, starting from registration and licensing, to determining the location and establishing the necessary infrastructure for work. With the support of many consulting companies specialized in establishing businesses, it has become easy for new investors to enter the local market and launch their business projects successfully.
Establishing a company in Dubai is not just a commercial step, but rather a strategic investment that paves the way for future opportunities in a diverse and thriving global market.
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ToggleConditions for establishing a company in Dubai
Establishing a company in Dubai requires compliance with a number of conditions and requirements that must be met. Here are some general conditions that must be taken into account when establishing a company in Dubai:
Type of company: The appropriate type of company must be determined, such as a limited company, a limited liability company, a sole proprietorship, etc.
Company name: The company name must be chosen to be unique and not similar to other company names, and must comply with local regulations and legislation.
Shareholders: The shareholders of the company and their percentage of contribution must be determined.
Capital: The capital required to establish the company must be determined based on the type of company and business activity.
Licenses and permits: Certain activities may require obtaining special licenses from the competent authorities, such as building or manufacturing licenses.
Commercial license: The commercial license issued by the competent government authorities, such as the Department of Economic Development in Dubai, must be obtained.
Initial location: A specific address for the company’s headquarters in Dubai must be provided.
Bank account: A bank account must be opened for the company in a local bank.
Insurance and taxes: The company must ensure that it is committed to all necessary taxes and insurances.
Visas: If the company employs foreign employees, work permits and residence visas must be obtained for them.
Costs of establishing a company in Dubai
The costs of establishing a company in Dubai vary based on several factors, such as the type of company, location (free zone or onshore), and the size of the business activity. Here are some elements that affect the cost:
Commercial license: This is one of the most prominent elements that determine the cost, as companies must obtain a license from the competent authority, and the type of license varies according to the business activity.
Rent and space: In the case of companies that need a headquarters, the cost of rent must be taken into account. Prices vary depending on the location and size of the company, whether in a free zone or an onshore commercial zone.
Government fees: These fees include registration costs, necessary approvals, and annual license renewal. These fees may vary depending on the type of company and its field of activity.
Labor and employees: The cost of hiring labor varies depending on the number of employees and the required job level. In addition, the costs of accommodation and visas for employees must be calculated.
Legal and accounting consultations: The costs of legal and accounting consultations to provide support in establishing the company and preparing the necessary documents.
Office equipment: These costs include purchasing furniture and technical equipment, in addition to securing communications and the Internet.
Foreign ownership: In some cases, it may be necessary to pay costs related to arrangements for foreign ownership, especially if the company requires a local partner or a partner in an onshore area.
Administrative fees: These include administrative fees related to the procedures for establishing the company, such as official registration, publication in newspapers, and other procedures.
Documents Required to Establish a Company in Dubai
To establish a company in Dubai, there are a set of documents that must be provided by the partners or managers. These documents vary slightly depending on the type of company (such as a limited liability company, a branch of a company, or a company in a free zone), but there are some basic documents that are common. Here is a list of the required documents:
Personal documents for partners and managers
Passport: A valid copy for each partner and manager.
Valid residency: If the partner or manager is a resident of the UAE.
Personal photos: A number of personal photos (usually 3-5 photos) for each partner and manager.
No-Objection Certificate: From the wife, if the partner is a married woman.
Legal documents
Memorandum of Association (MOA): A formal contract that specifies the details of the company, such as the type of company, its name, business activity, and the nationality of the partners, and must be notarized with the relevant authorities.
Operation Contract: (If applicable) sets out how the company will be managed and the rights and obligations of the partners.
Trade Name Approval: The availability of the company’s trade name must be verified with the Department of Economic Development or the relevant authority.
Trade License: An application must be submitted for a trade license, and it varies depending on the type of business activity.
Commercial and administrative documents
Business plan: Some entities may require a business plan that explains the type of business activity and the company’s objectives.
Proof of address: such as an office lease or land ownership contract, depending on the location of the activity.
Financial certificates: from a chartered accountant or bank to prove financial stability or to prove the availability of the required capital.
Work visas: Documents related to applying for work visas for employees, if they are employed by the company.
Additional documents depending on the type of company
For companies in free zones: Documents such as an office lease contract within the free zone, an investment certificate, and other requirements specific to the free zone are required.
For limited liability companies (LLC): You may need to submit additional documents, such as appointing a local partner if the activity requires it, or proof of ownership rights.
Documents for foreign partners
Partnership contract: If there is a local partner, a partnership contract must be submitted that shows the percentages of ownership in the company.
Documentation of foreign partnerships: Documents that prove the ability of foreign partners to invest in Dubai, such as foreign company records or legal certificates.
In conclusion, setting up a company in Dubai is a great strategic move for investors and entrepreneurs looking to expand into a global and growing market. Dubai offers a unique and encouraging business environment, characterized by economic stability, advanced infrastructure, and easy and flexible company formation procedures. The city also offers wide opportunities in various sectors such as trade, technology, logistics, and tourism, making it an ideal destination for businesses.
However, it is important for investors to have a complete understanding of the requirements for establishing a company, including choosing the appropriate company type (such as freelance companies or limited liability companies) and determining the most suitable location. Careful planning should also be done to determine the expected costs, which vary based on the type of company and location. It is also essential to adhere to local laws and regulations, which ensure the success and sustainability of the business in the market.
Hiring a company specialized in company formation services, such as “Itqan”, may be a wise choice to facilitate the process and ensure full compliance with the laws. This way, investors can focus on developing their business without worrying about complicated procedures.
Ultimately, Dubai is a fertile environment for growth and innovation, opening up tremendous opportunities for entrepreneurs. With good planning and the right partner, anyone can succeed in this dynamic market, laying a solid foundation for a bright and prosperous future.
Top Frequently Asked Questions About Starting a Business in Dubai
Can I own a company in Dubai without being a resident?
Yes, you can start a company in Dubai without being a resident, but it depends on the type of company and location. Companies in free zones allow full foreign ownership, while onshore companies require a local partner.
Do I need to hire employees to start a company?
It is not necessary to hire employees immediately upon starting a company, but some businesses require employees based on licensing requirements.
Can I change the type of business activity after incorporation?
Yes, the business activity can be modified after incorporation, but this requires submitting an application to the relevant authorities and obtaining approval to change the activity or license.
Do I need to have a physical office to start a company?
In some cases, especially for companies in free zones, virtual offices or co-working spaces can be used. But offshore companies usually need a lease for a physical office.