Dubai is one of the best city to do business, on this article we will guide you on how to do a business setup in Dubai. There are two authorities in Dubai for conducting business: Dubai mainland, and over 20 free trade zones, which provide different advantages depending upon your business type and activities. If you decide to conduct business in the mainland, you’ll have to register with the Department of Economic Development (DED), which will issue you with a trade/business license. Alternatively, each free zone has its own licensing body, and you’ll have to contact them directly for the licensing process. To get you started see Setting up in a free zone. Wherever you opt to install, you won’t need to pay any business or individual taxes.
Setting-up Business in Dubai, UAE
All businesses setting up outside a free zone in Dubai must possess a trade or business license which decides which business activities you’re permitted to practice. You must also have either:
- Sponsorship from a UAE national, who will have a 51% stake in your business (if establishing a limited liability company (LLC) or public/private shareholding company) or
- Sponsorship from a local service representative (if setting up a branch company, sole proprietorship or civil business)
Trade license in Dubai
There are three types of trade license:
- Commercial licenses cover all kinds of trading activity
- Professional licenses cover professions, services, craftsmen and artisans
- Industrial licenses are for establishing industrial or manufacturing activities
As part of the trade license application, you will need to:
- Choose your business activity (see below)
- Choose your legal form
- Register your trade name
- Apply for an Initial Approval Certificate
- Rent/buy commercial premises
- Obtain special licensing approvals (if required)
Only then can you be given a complete trade license. The next few pages cover these how-tos in detail.
Selecting a business activity in Dubai
A business may have a maximum of 10 activities per transaction license. Visit dubaided.gov.ae for a complete list of business activities, which fall into various groups. If your business activity is not listed, you will need to email [email protected] with a description Of this activity. After reviewing your request, the DED can then make a new business activity for you, with a necessary code for the transaction license application. Some business activities require a special approval from government bodies apart from the DED (see Obtaining special approval for a business activity).
Once you have a trade license you will need to:
- Register with the Dubai Chamber of Commerce & Industry (DCCI) (some small businesses and artisans exempt)
- Apply for an establishment immigration card
- Apply for an establishment labor card
- Apply for immigration and individual labor cards
Business Setup in Dubai Free Zone
Free zones have their own set of principles and procedures for establishing a company, and are intended to promote foreign investment. The principles and procedures for establishing businesses differ from the rest of Dubai, especially with respect to foreign ownership. By way of example, a branch or a representative office could be established in a free zone with assistance from the free zone authority. Non-nationals and overseas companies may also decide to establish a free zone division as their head office. If you prepare the company within the free zone, complete private foreign ownership is permitted, albeit with substantial yearly fees.
Both immigration and labor laws vary slightly also from the free zones. This chapter features a comprehensive section on free zones that will assist you realize the various diverse steps that will have to be taken.
Department of Economic Development (DED)
This is the first port of call when establishing a business in Dubai: it issues trade licenses and is the integral authority for businesses here (dubaided.gov.ae)
Ministry of Economy (MOE)
This manages all financial activity in the UAE. Foreign companies wanting to establish a branch in Dubai, in addition to insurance companies, brokers and agents, must obtain approvals from the ministry. The MOE also manages the registration of commercial agents and agencies, (economy.ae)
All businesses out of a free zone must get approval from the municipality for their premises prior to setup; zoning regulations are both devised and enforced here. The municipality is responsible for Dubai’s infrastructure and urban landscaping, (dm.gov.ae)