Dubai is a famous destination among different investors and entrepreneurs. It is an investor-friendly and low-tax policy country that makes people easy for doing business. If you are looking to start a business in Dubai, here are some prominent benefits that will convince you to start a business there.
Benefits of Starting a Business in Dubai
Dubai offers many advantages and opportunities to start a business. So, here are some reasons you need a business setup in Dubai that could benefit you.
- It provides access to multiple markets due to its strategic location.
- It offers a diversified and thriving economy with many business opportunities.
- It provides a favorable tax environment with no tax in many free zones.
- It regulates business-friendly rules and streamlined processes.
- It offers a diverse population with international events that attract potential customers.
- It provides world-class infrastructure, including modern transportation.
- It provides easy access to a talented workforce.
- Free zones in many regions allow 100% ownership and simplified company registration.
- It provides initiatives from supportive governments and offers different incentives for businesses.
- It offers a high standard of living with modern facilities.
Formation Steps to Start a Business in Dubai
A company formation in Dubai involves planning, conceptualizing, research, budgeting, setup, and decision-making. Moreover, it also requires assistance and guidance in selecting the type of business and license, especially if you are a new entrepreneur. So, here are the formation steps to start a business in Dubai
- Select a business activity
- Select the jurisdiction
- Finalize the company structure/legal form
- Get the required approval for a company name and business activity
- Apply for your trade license
- Register your company
- Find a local agent (if required)
- Get your external approvals
- Prepare your Memorandum of Association
- Rent an office
- Get the tenancy contact & ejari
- Get the initial approval
- Collect your trade license
To start a business in Dubai, these are the formation steps you need to consider:
Select a business activity
Firstly, decide the type of business you want to start, such as manufacturing, trading, consulting or any other.
Select the jurisdiction
After selecting the type of business, select the location for your business accordingly. Dubai offers various free zones and mainland options with benefits and regulations.
Finalize the company structure/legal form
Determine the legal structure of your company, whether it will be
- Limited liability company (LLC)
- Sole Establishment
- Civil company
- Local company branch
- GCC company branch
- Foreign company branch
- Free zone company branch
- Holding company
Get approval for your Company Name and Activity
Choose a unique and appropriate name for your company and obtain approval from the relevant authorities. Additionally, ensure that the business activity aligns with your chosen company name.
Apply for your Trade License
Based on your business activity and jurisdiction, apply for the appropriate trade license that permits you to conduct your business legally.
- Commercial License
- Professional License
- Industrial License
- Tourism License
Register your Company
Register your company with the Department of Economic Development to avoid any legal matters. Furthermore, this step involves submitting necessary documents and completing the required paperwork.
Find a Local Agent (if required)
Sometimes, setting up a business in Dubai may require a local sponsor or agent, especially on the mainland. This person will represent your company in dealings with government authorities.
Get your External Approvals
According to the nature of your job, you might need additional approvals from government or regulatory bodies.
Prepare your Memorandum of Association
Roughly draft the Memorandum of Association (MOA) that includes the activities, shareholders, and other essential information about the company. This document is crucial for company registration.
Rent an office
Secure a physical office space for your business operations. Make sure the location complies with the requirements of the selected jurisdiction.
Get the Tenancy Contract
Sign a tenancy contract for your office space and register it with Ejari, the government system for real estate registration in Dubai.
Get the Initial Approval
Obtain initial approval from the DED or free zone authority after submitting all required documents and fulfilling the necessary conditions.
Collect your Trade License
Once all the approvals and paperwork are in place, you can collect your trade license, which officially permits you to conduct your chosen business activity. Therefore, you have to submit the following for the collection of the trade license:
- Memorandum of Association (MoA)
- Trade license application
- Relevant government forms
- Trade name reservation certificate
- Initial approval certificate
- External approvals (if any)
- Tenancy contract Ejari registration certificate
- Passport copies of partners’ NOC for partners (if any)
- Other requirements by the DED (if any)
Starting a business in Dubai requires adherence to specific regulations and processes, and it is advisable to seek professional assistance or consult with local experts to ensure a smooth and successful setup. Lastly, all these should be submitted to the Department of Economic Development with government fees.
Opening a Corporate Bank account:
To open a corporate bank account, here are the steps to be followed:
- Firstly, research and select a bank that suits your business needs.
- Next, gather the required documents, including passport copies of shareholders and directors, proof of address, company documents (trade license, MOA/AOA, certificate of incorporation), and completed bank application forms.
- After that, you can visit the bank branch in person or follow the online application process.
- Additionally, provide any requested documents or information per the bank’s requirements.
- Moreover, comply with the KYC (Know Your Customer) requirements and undergo due diligence checks as part of the bank’s standard procedures.
- Subsequently, deposit the required initial funds into the corporate bank account to activate it.
- Once the account is approved, you will receive the details and access to online banking services for convenient transactions and management.
Setting up a business in Dubai requires understanding the legal structures, gathering necessary documents, choosing the right bank, and complying with local regulations. So, seeking professional guidance can be beneficial, and Dubai offers a promising environment for business growth.
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