Steps to start a business in UAE: A Complete Guide
UAE is the epicenter for successful startups, with a flourishing economy that always manages to bounce back. It attracts thousands of brilliant minds interested in setting up a business in UAE. It is a city that offers a bounty of advantages to willing. It is a gold mine for innovative entrepreneurs with a sellable idea. It also provides the newcomers a business-centric government, global business exposure, better investment opportunities, and lower taxes.
As a business setup consultant in UAE, we have helped several startups get on their feet. It has made us uniquely qualified to offer you advice on how the business setup procedure works. This guide was created with the sole prospect of educating you. If you have any queries feel free to comment or contact us.
Step 1: Selecting Business Activities Based on UAE’s Guidelines:
Out of all the things to consider, selecting business activities ranks high on the list of priorities because it assists you in making thinking a few steps ahead. First and foremost, be aware that certain restrictions prohibit some business activities. When you finalize a business activity, you’ll have to figure out which free zones will work the best for that particular activity, be it medical, transport, or media. For example, if your business activity is international trading, you might want to settle in a zone closer to the airport. Also, remember that it is ideal to set up a business in the same industrial sectors.
Although this is a big step, one that guides you through the entire process, you don’t necessarily have to finalize everything on the get-go. The paperwork can be done later. You can also choose to register for multiple business activities under one license.
We understand your need to be thorough and therefore are open to assisting you in providing you information about the activities available to you. For more information, reach out to us at Blue Crayon Consulting.
Step 2: Select A Business Name that conforms the Standards Set by the Authority.
Authority in the UAE has set a standard for a trade name or a business name. The Business name shouldn’t make use of any prohibited or offensive language. It should not refer to any political, sectarian, or religious groups. If you are adamant about naming the business after a person, that person needs to be either a partner or owner of that business. And you cannot substitute a full name for initials or abbreviations. Only the usage of the full name is allowed. A business name speaks highly about your business identity. Once you register for a business name, it remains valid for six months.
Step 3: Select A Jurisdiction As Per Your Business Requirements
Primarily, there are three jurisdictions in Dubai, Mainland, Free-Zone, and Offshore. Each zone has numerous things to offer. For example, the Mainland provides you the flexibility to work anywhere in Dubai. The offshore jurisdictions offer you an opportunity to set up an organization in the UAE. These organizations provide their services to clients outside the UAE’s jurisdiction. The benefits of Free Zone are abundant, from retaining 100% ownership of one’s company to both corporate and personal tax optimization. Here is another stellar example of how selecting a business activity early on can help you along the way.
When you have chosen a business activity, you can then pick from one of the three jurisdictions under which your business can operate.
For more information Regarding these Jurisdictions, Visit UAE Corporate Law.
Step 4: Business Ownership:
4.1 Enter Into A legal agreement with a UAE National
The first way involves you sharing your business setup in Dubai with UAE nationals. So, before you start anything, you need to start looking for a UAE national who will act as your local sponsor.
This UAE national will be a 51% partner in your local company. The sponsor also needs to be paid an annual fee. It will show the person your appreciation and will create trust between you two. Also, remember that you can’t sign a sponsorship until both you and the sponsor have agreed on the payment terms and what you expect from each other. It all needs to be put into a written agreement with a legal stamp of approval.
Owning a local company has its advantages. You will be able to move your business to any jurisdiction.
4.2: Set Up Your Business In The Free Business Zones
The second way involves retaining 100% ownership of your business. For that, you have to set up your business in the free zone jurisdiction. Now, if your business activities include a retail store or restaurant, it needs to be in the heart of the city markets, so this might not be the ideal solution for you. Similarly, if your business activities include your working with the government, then you need to register with a local sponsor.
Its disadvantages include a hefty price for either renting an office space or a purchase of a building in the Free Zone.
Its advantages are, as we have already discussed, complete ownership, a quick setup in the free zone in UAE, and duty-free customs boundary.
Step 5: Finalize a location for the business setup
There are also several things you need to consider before setting up a business in Dubai prime amongst them is costs and suitability.
As we have seen, selecting a business location most profitable for your new company is an ideal choice to make. If you were considering opening accounting services Dubai, then you will have to choose a location where your prospective clients can easily reach you. Now, the coss in the Free zone can differ drastically based on the location. So, do your research before you finalize one location.
Apart from that, you have to prepare yourself for various scenarios. Once you have decided to start a business in the free zone in UAE, you also need to plan for a few different office sizes. Because when you visit the registration office to register your business, your desired office size might not be available. Few offices allow only one visa per person, be it investor or employee. That’s another issue to think about before you proceed.
Step 6: Finalizing Business Paperwork:
Business paperwork takes the cake as it can be gruesome, and for a business setup in UAE, even more so. First, you’ll need to start with filling and submitting an application for your business name and activity, which should be submitted to the relevant government authorities along with your shareholder’s passports. Few free zones require further documents such as a NOC, short for Non-Objection Certificate. Managing all the documents can be a tedious job. Let us lend a helping hand and assist you with the process. You can reach us through various means, one of which is filling out the contact us form. You can also contact us directly through email and phone numbers provided on the same page.
Step 7: Getting Your business and its activities approved by UAE Authority
Once you have submitted the necessary documents, the authority grants an initial approval, which allows a business to start their activities. Even if you do not have a trade license, you can still begin your business while continuing the process of procuring it.
Upon submission of all the documents, authority will assign you either a transaction number or a payment voucher. Once you make the final payment, you can collect the business license, following which your business in UAE will be able to start all your business activities.
Step 8: Open A Bank Account:
Once you have completed the paperwork, you need to open a new corporate bank account. Select a reputed bank. It could be local or global. But before you decide on a bank, confirm the charges your business needs to pay because a business dependent on the bank may have to pay a large amount. Here’s a small list of banks you can check out:
➢ Abu Dhabi Commercial BANK
➢ Commercial Bank Of Dubai
➢ Emirates NBD
Step 9: Visa Verification
Depending on the free zones you select, you can not only apply for a visa of your own but your staff as well. The number of Visas you can apply for depends on the free zone you choose for your business. Ensure that everyone, be it a staff member or your family member or you, are all eligible for a visa. Once it all checks out, you can go through the process in steps. Being with the entry permit, then move on to the status adjustment, after which you’ll have to pass a medical fitness state, and finally register for Emirates ID and get a stamp on your visa.
Step 10: Consider Hiring a Registration Agent
If you have been through all the nine steps, you’ll have come across some that you can’t comprehend or cannot consider doing by yourself. Armed to the teeth with over ten years of experience, Blue Crayon Consulting is aware of all the ins and outs of setting up a business in the UAE. And these are the things that we, as business setup consultants in Dubai and UAE, can undertake. For example, we can either assign you a registration agent or guide you through the entire process as per your requirements. Here are a few things that we can help you with:
➢ They can provide you with detailed resources on business requirements
➢ make you aware of the laws and regulations
➢ help you figure out what naming-conventions you need to beware of,
➢ also help you with the document requirements, filling, and submission ensuring you don’t make any mistakes