Company Formation in Dubai

More and more foreign investors are looking to start their business in the country. UAE offers some fantastic facilities and infrastructure for different types of business and company formation in Dubai.

There are various procedures involved in company formation in Dubai. And you have to follow all the procedures very carefully. Although things are not complicated, if you are aware of legal requirements and other essential formalities, you can start in the right direction. Here is a detailed discussion on everything you need to keep in mind before setting up your business in Dubai/ mainland business setup in Dubai.

Types of company formation in UAE

  • Sole Proprietorship:
    • An individual wholly owns the sole proprietorship. If you want to set up a sole proprietorship, you will have full control of everything from operations, shares, and profits, etc.
  • Civil Company:
    • It is the most common type of company formation in UAE for professionals like doctors, surgeons, engineers, lawyers, and accountants, etc. A civil company can allow 100% shares to its partners, but can only involve professionals in other activities.
  • Limited Liability Company:
    • LLC is one of the most common and popular types of company registration in UAE. It allows a minimum of 2 and a maximum of 50 shareholders for the investment. But the investors are liable only for their investments.
  • Private Shareholding Company:
    • Also known as Private Joint-Stock Company, it is formed from at least three investors with at least AED 2,000,000. These legal structures are adaptable to all types of industrial and commercial activities, including professional businesses.
  • Public shareholding company:
    • It is a legal entity with a minimum capital of AED 10,000,000. A public shareholding company allows transferable shares of equal value, but shareholders are liable to their money only.
  • Branch Office:
    • A branch office is not considered a separate company formation in the UAE. Instead, it is a dedicated outlet of an already established company. There are some common types of branch offices in UAE, including foreign company branch, UAE company branch, free zone company branch, and GCC company branch, etc.

Different Types of Licenses for company formation in Dubai

There are primarily four types of licenses issued in Dubai for business setup. These are:

  • Commercial license for common trading businesses
  • Professional license for businesses related to different services
  • Industrial license for production and manufacturing units
  • Tourism license for companies related to travel and tourism
Benefits of starting a business in Dubai:

Here are some valid reasons why it’s a great idea to start your business in the City of Gold.

  • Some beautiful destinations: Dubai is the home for some of the world’s most sophisticated destinations. These are more than perfect for foreign investors planning to start their businesses.
  • A wide range of business forms: You can choose from onshore and offshore companies (A rarity these days).
  • Business registration is easy: Dubai is among a very few countries that offer secure, hassle-free company registration. If you want a company registration in UAE, you don’t need to wait for long weeks. All you need to do is to appoint a local agent. And you will get your company registered within a few days.
  • Simple capital requirements: If you aim to set up a limited liability company (LLC), you don’t need to ponder minimum share capital, as it is only necessary for joint-stock companies.
Procedure for company formation in Dubai:

You have to follow a step-wise procedure for your company formation in Dubai. Some critical steps are:

  1. You have to decide the type and nature of your business.
  2. Choose a unique company name that should reflect your business.
  3. Complete all the necessary incorporation paperwork with the help of relevant government authorities.
  4. Accept your license notification from the government.
  5. Open a corporate bank.
  6. Apply for the visa.
How we assist you in business setup:

If you are planning for a Mainland company or Freezone company or Offshore company anywhere in UAE, we can help.

FAQ’s

1. How do I start a company in Dubai as a foreign investor?
To start a company in Dubai as a foreign investor, you’ll need to choose the right business activity, determine whether you want to operate in a free zone or mainland, and prepare the required legal documents. The process includes securing a trade name, obtaining initial approvals, and applying for a license.

2. What are the steps involved in company formation in Dubai?
Company formation in Dubai typically involves selecting your business type, choosing a location (free zone or mainland), registering your trade name, getting approvals from relevant authorities, and obtaining your business license. Each step must comply with local regulations to ensure a smooth launch.

3. What is the total cost of Dubai company registration?
The cost of setting up a business in Dubai varies based on the license type, business activity, location, and visa requirements. Free zone setups may offer packages starting from AED 10,000, while mainland setups may cost more depending on your operational needs.

4. Do I need a local sponsor for starting a business in Dubai?
For mainland businesses, a local sponsor (UAE national) is usually required for certain business types, particularly those not fully owned by foreigners. However, recent changes in UAE law now allow 100% foreign ownership in many sectors, reducing the need for a local partner.

5. What are the benefits of company registration in UAE?
Company registration in UAE offers multiple benefits, including 100% repatriation of profits, zero personal and corporate taxes in many jurisdictions, strategic global location, world-class infrastructure, and simplified visa processes for investors and employees.

6. Can I register my company in a Dubai free zone and still do business in the mainland?
Generally speaking, businesses that are registered in a free zone are only allowed to operate there or abroad. To conduct direct business in the mainland, you’ll need to appoint a local distributor or open a mainland branch with the appropriate license.

7. How long does the process of setting up a business in Dubai take?
If all documents are in order, setting up a business in Dubai can take as little as 3 to 7 working days, especially in free zones. However, more complex business structures or licensing requirements may take longer.

8. What documents are required for company registration in UAE?
The standard documents required include a copy of the shareholder’s passport, visa copy (if applicable), proof of address, trade name approval, and a detailed business plan. Additional documents may be needed depending on the business activity and location.

9. Is it better to form a company in a Dubai free zone or mainland?
The choice depends on your business goals. Free zones offer 100% foreign ownership and simplified processes but are limited in terms of local trade. Mainland companies provide access to the UAE market without restriction but may require a local sponsor and have slightly more regulations.

10. What support services are available for starting a business in Dubai?
Professional business consultants like Hallmark International provide end-to-end support including legal paperwork, license applications, visa processing, office setup, and bank account opening, making starting a business in Dubai smooth and stress-free.