Among investors and entrepreneurs, the UAE is a popular destination. Not only is it an investor-friendly country, but it has helped improve its position as a business hub in the Middle East with its low tax policies and ease of doing business. The government also has laws and regulations in place that benefit business owners and promote them.
Follow the steps below to establish a company in the UAE:
Pick Activity for Business
Bear in mind the practicality of the chosen activity in relation to the UAE market when choosing a business activity for your entrepreneurial venture. Before you decide to start a business in the UAE, do a detailed analysis of the viability and profitability of the operation.
Choose a Jurisdiction
The UAE industry is split into multiple economic zones-Mainland, Free Zone, and Offshore. Jurisdictions are also called these economic zones. Each jurisdiction has its own set of laws and regulations relating to the establishment of companies. They cater to various business needs as well. It depends on your business requirements and your business activities to choose a jurisdiction for your company.
Decide the structure/legal form of the organization
When starting a business in the UAE, choosing the legal type for your company is an important decision. It sets the tone and framework for coping with gains and losses and how the capital and assets should be structured. At the initial stages of preparation, determine the legal form of the business structure. This will help to provide the business with a layout. You will not apply for your business license until you settle on the legal form of your organization.
Following are some of the legal forms or company structures under which you can register your business in the UAE:
- Limited Liability Company (LLC)
- Sole Establishment
- Civil Company
- Local Company Branch
- GCC Company Branch
- Foreign Company Branch
- Free Zone Company Branch
- Holding Companies
Get your corporate name and operation approval
Before you can go forward and start the process of setting up your company in the UAE, the Department of Economic Development (DED) must approve the trade name for your firm. Along with your company name, during this process, your selected business activity also goes through approval. After the approvals are issued, you will need to send documentation to apply for your UAE trade license.
Request your Trade License
In the UAE, there are four kinds of trade licenses, also called business licenses, from which you can choose:
- Commercial License
- Professional License
- Industrial License
- Tourism License
If you intend to start a business on the mainland of the UAE, you can apply for either of these commercial licenses. In the UAE free zones, the licensing system is different and depends on the business operation that your business chooses to pursue.
Register Your Company
Registration and licensing of companies are a simultaneous process. The entire paperwork and approval process, however, goes through different phases. In this process, as requested by the Department of Economic Development, you will have to obtain all the approvals from the relevant government authorities. For each company form and operation, the documents needed are different.
Find a sponsor/Local Affiliate
It is mandatory to find a local partner for your company in order to start a business in the UAE mainland. Only UAE nationals must be a local affiliate or local sponsor. The local sponsor will hold 51 percent of the shares in your business under UAE commercial law. Two kinds of sponsorships are available, local sponsorship and corporate sponsorship. It can seem tiring, especially for a first-time entrepreneur, to find a trustworthy partner or sponsor. A business setup consultant can connect you with companies that offer corporate sponsorship where you will be given documented authority and 100% ownership of your business.
Get your approvals for external
Depending on your business operation, the Department of Economic Development may seek additional permissions from other government or non-government agencies. For instance, some businesses can be asked to get approvals from the municipality, specific banks, embassies, etc.
Draft the Partnership Memorandum
Understanding the nuances of a Memorandum of Association is essential (MOA). Make sure to get expert advice before drafting the MOA for your business. The MOA should be drafted in compliance with the mandates of the UAE government and must take your business interests into account as well.
Renting an Office
You may choose to rent an office unit or opt for a shared workspace in a business centre, depending on your business needs. The number of visas you may obtain from the Department of Economic Development can also be determined by the office room.
Get Ejari and the Tenancy Link
The arrangement between you and the real estate agent whose office unit or shared workspace you plan to rent is a rental contract. Ejari is an online system run by the Regulatory Agency for Real Estate (RERA). This guarantees equality and transparency between the two parties involved in the tenancy. To unlock your Ejari account, you must apply your tenancy contract and a few more documents. Ejari is very important because for your family members and/or staff, you need it to get or renew visas.
Get an Initial Authorization
You must get the Initial Approval from DED before getting your business license. This approval means that you do not object to the UAE government starting a company in the UAE. You will not move to the next steps in the application process if you do not obtain this approval.
Gather your Trade License
To receive your UAE commercial license, you will need to apply the following:
- The Association Memorandum (MOA)
- Application for Trade Licenses
- Relevant forms for the government
- Trade name certificate of reservation
- Certificate for initial approval
- External (if any)
- Tenancy Agreement
- EJARI certificate for registration
- Copies of partners’ passports
- NOC for partners (if any)
- Further DED specifications (if any)
All these should be submitted along with the required government fees to the Department of Economic Development.
Contact EasyStart360 for Business Setup
Contact EasyStart360 for Business Setup
You can contact Easystart Business Setup if you need advice on how to start a UAE business. For almost 20 years now, we have been helping entrepreneurs develop their businesses in the UAE. Book your FREE consultation today with our experts in business formation! Contact us at +971502383404 or call us on WhatsApp at +971502383404. To learn about the wide variety of business setup services we offer, you can also contact us at [email protected] or visit https://www.easystart360.com/