OVERVIEW
If you are looking for a truly dynamic business hub to set up your new company, UAE is the right place for you – and for many reasons.
UAE caters to entrepreneurs, start-ups, small businesses, and giant multinational corporations with the same levels of ease, efficiency, speed, and service. Furthermore, multiple choices are available for every aspect of business setup in UAE: budget, license, location, and premises.
Company Formation in UAE spells out several big benefits that include tax savings, good governance, superior infrastructure, premium lifestyle, and constantly developing opportunities. Another unique offering is the easy access to consumers in multiple markets; Dubai’s enviable location also results in an international and vastly multicultural workforce.
Free zone v/s Mainland
For the purpose of company registration in Dubai, you have to decide whether you want to establish your company on the mainland or in a free zone. When considering a new business setup services in Dubai, location is a key decision. Low Cost Business Setup in UAE is possible at one of Dubai’s many specialized free zones, or on the mainland (sometimes referred to as onshore).
In 1985, Dubai launched Jebel Ali Free Zone Authority (JAFZA) as the first free zone in the UAE and the Middle East. The small operation opened with only 19 companies, but within a decade became the first free zone in the world to be awarded ISO certification. The JAFZA success story became the blueprint for several free zones, each offering strategic benefits and advantages. These free zones house thousands of foreign individual and institutions who have successfully set up Branch or 100% owned company in Dubai.
In 2021, changes were made to the UAE Commercial Companies Law, allowing a foreigner, group of foreigners, or a foreign company to have 100% fully owned businesses in the UAE, subject to certain rules. The Dubai Government quickly announced 100% foreign ownership status for more than 1,000 commercial and industrial activities in the emirate.
As a result of these changes, some long-established businesses on the mainland are amending their ownership pattern while numerous others are pursuing new business formation in Dubai.
Proprietorship v/s Partnership
The legal entity of your business setup in Dubai is another important decision, and this will depend on the number of shareholders, and whether these shareholder/s are considered natural persons or legal persons in the UAE.
In broad terms, if you are an entrepreneur based in the UAE or a business owner from another part of the world with plans for providing service-related activities in the UAE market, you can set up a new company in Dubai, with a sole proprietor mainland licence. You can also register your new business in Dubai as a freelancer, free zone limited liability company (FZ LLC), free zone entity (FZE) or free zone company (FZ CO) at one of Dubai’s 30 plus free zones.
If your new business in Dubai is commercial in nature such as trading or contracting, , the ideal option on the mainland is a limited liability company (LLC), with a minimum of one and a maximum of 50 shareholders.
Companies with more than 50 shareholders are typically registered in Dubai as a private limited company (PLC). The public joint stock company (PJSC) is a more complex structure with management by a collegial body of directors acting as trustees for shareholders.
Dubai also licences branches, regional headquarters and representative offices of foreign companies, and ‘single family offices’ where all shareholders are from the same family.
Budget v/s Value
The costs associated with new business setup in Dubai UAE is based on variables such as the type of company to be incorporated, the type of license applied for, and the number of work visas required. For example, if your business has four partners and you plan to hire eight employees, visa application fees have to be paid separately for each individual.
Company setup in Dubai does not always require a minimum share capital, and is based on the size and structure of the organization. Office rental charges too vary greatly, with choices ranging from virtual spaces and hot desks on 1-year contracts, to workshops, warehouses and large offices on long-term leases.
The total cost of business setup in Dubai can be broadly divided into four components: documentation and attestations, licensing and share capital requirements, visa processing, and workspace.
Many options are extremely affordable. For solo entrepreneurs and start-ups, Dubai Economy’s Instant Licence starts at approximately AED 12,000. Likewise, some of Dubai’s free zones offer extremely affordable business set up packages. For instance, International Free Zone Authority (IFZA) in Dubai offers the IFZA Dubai Trading Licence which starts at AED 13,500.
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