Last Updated on May 25, 2022 by Steven
Start a Business in Dubai
If you’re already living in Dubai, you already know that Dubai is a city open to all types of businesses. For foreigners, the process of starting a business is relatively straightforward as long you are informed of the procedures, rules, and regulations involved.
How Can I Do Business in Dubai
Anyone can do business in Dubai as long as they have the right documentation and live in the city legally. To capitalize on the numerous investments opportunities in Dubai, you can rely on numerous agencies set up to assist international entrepreneurs with the licensing, visa, and business incorporation formalities.
Setting up a business as a foreigner requires you to familiarize yourself with the habits and practices of the locals to develop a good and informed business strategy. Also, if you want to start a business venture in Dubai, you should make sure you comply with all the legal obligations as described below.
How Can You Start a Business in Dubai?
1) Decide on an activity
Before even registering your business, you should first decide what product or service you want to offer. In Dubai, your choice of business activity often determines the location of the business. The Department of Economic Development already has a list of activities under which your company can fall, and you can go ahead and consult them.
2) Decide on a suitable location
In business, positioning is everything. Depending on the type of product you’re selling, you can choose to either set up your business in one of the many free trade zones or the mainland. Setting up your business in a free zone comes with a few perks.
Some of the benefits you enjoy include getting full ownership of your business and operating the business without having to pay any tax. In the mainland, you cannot have full ownership of your business since you’ll be required to get a partner who will have 51% ownership of your business.
3) Decide on company name
Deciding on a name for your business should be easy. You only need to adhere to the UAE’s strict naming conventions. In Dubai, there are a few guidelines that investors ought to follow when choosing a company name. Any company name you choose ought to be relevant to the activity of your company and should not have any international organization’s name. It is prudent to always do a name search and ensure no other company has the same name.
4) Apply for a license
Like in any other country, operating a business is not possible unless you have the correct documents. In other free zones, having a business plan is a must as well.
5) Open a bank account
For you to get a corporate bank account, you must be a holder of a business license. It helps to prove that your business is legal in Dubai, and you are also fully authorized to carry out that business. Therefore, you can open a bank account with a bank of your choice with a business license. See Banks in Dubai.
Required documents to start a business in Dubai
Companies operating in free zones are subject to the rules of the free zones in which they operate. As such, the documentation required will vary depending on which free zone you apply to. The following items may be required if you’d like to start a business:
- A business strategy
- A duly filled application form
- A replica of your existing business license/registration certificate (if you are an existing company, applicable for local companies only)
- Colored passport copies of the company’s shareholder(s) and the new company’s chosen Manager/Director
- Specimen signatures of the company’s shareholder(s) and the new company’s designated Manager/Director
- Financial records for the previous two years that have been audited
Before getting all the permits and licenses, you first have to go to the authorities tasked with issuing those respective documents. Some of these authorities include:
- Dubai Development Authority – Issues licenses by industry cluster
- Ministry of Economy – Offers Trademark registration
- Dubai Customs – No objection certificate issuance
- General Directorate of Residency and Foreigners Affairs (GDRFA) website – Visa
Before investing in Dubai, you first have to get a visa. The application process for a visa is quite straightforward and can be done online by visiting the General Directorate of Residency and Foreigners Affairs (GDRFA) (opens a new window) website.
As stated earlier, in the free zone, you get full ownership of your business, whereas, in the mainland, you will have to get a business partner who will own 51% of the business. In this case, you can opt to choose to contact a startup agent who can walk you through each stage while also providing advice and help.
This could also interest you: United Arab Emirates Business in UAE
How to Set Up Business in Dubai Free Zone?
Once your business documents are all set, and you have ascertained your eligibility to start running your business in Dubai, set it up. Luckily if you are more interested in the free zone area, by now you know in Dubai, there are multiple of them where you can set up your business.
Businesses in free trade zone are excluded from paying all types of taxes. Each of these free zones has its respective authority. While free zone companies in Dubai benefit from operating in these locations, owners must always have the proper permits and approvals to start and operate a business.
Therefore, to set up a business in a free zone, you only need to follow the steps below:
Specify the category of business venture you want to start
Free zones have slightly different rules, and it is wise to first understand them. In such zones, your company can exist either as a Free Zone Company (FZ Co.) or a Free Zone Establishment. The difference between these two types of ventures lies in how many shareholders a business has and whether the shareholders are legal or natural.
Get your paperwork done
Like in any other country, trading in Dubai is not possible without the correct documentation. In this case, here are the main documents that you must produce and process to set up your Dubai free zone company.
- A business card
- A dully filled license form
- Articles of Association and Memorandum of Association
- Copies of passport
- A business plan, and
- Banking and business details of a partnering investor if they exist
With these, the Arab Embassy or the Gulf Cooperation Council would be more than willing to approve your business start in the Dubai free zone. The government has made the process and requirements easy so as to attract more and more investors, both locals and foreigners. It is worth mentioning that the entire process will take about 4 weeks only to complete.
Look for an office space
To get an ideal office space, you first need to factor in the number of employees you require. Depending on your preference, you could decide to either purchase or lease office space. Different zones have different office packages for you to choose from. Take your time looking for one to ensure everything is within your budget but still get a strategic office space.
Note that you will need to wait for pre-approval for your business licenses and every other document before operating your business.
How to Find Business Partners in Dubai?
In business, sometimes, the best way to be more productive is to use combined effort. It is a requirement to get a partner before starting a business in Dubai’s mainland, so you should know where to find potential partners.
All citizens in UAE above 18 can become local business partners or even own a business by themselves. Therefore, you can look for a local partner above this age or a Local Service Agent who will handle all the government authorizations required to start and run a business in Dubai.
Some of the best ways to find good partners for business in Dubai include;
Inquire from others
Assuming you have your business plan ready, a management team, and maybe a working prototype, all that is left is looking for a business partner. Whether you are a foreigner or a local, it is wise to first consider the people around you. You can start by inquiring from your immediate contacts, friends, and family to find out if they know any people looking for co-founders.
Browse social media platforms
Almost everyone these days has a LinkedIn account. In UAE, more than there million people use LinkedIn with an average of more than 200 connections for each. This social media platform brings together professionals from different fields. You can start looking for potential investors on LinkedIn by browsing through different profiles and seeing their interests. Once you see a potential partner, approach them with your business information without revealing your trade secrets at first.
Find Startup Events and Conferences
Many people seeking to start businesses often have good ideas but lack adequate capital to start. The reason why startup events exist is so that you can present your ideas to investors. In Dubai, many conferences and startup events are usually held every year. For someone seeking a business partner to start a business in Dubai, the best place to find such partners is conferences and startup events.
Join Meetup Groups
Meetup groups are great avenues for exchanging ideas and meeting like-minded people apart from social networking. Most meetup groups tend to focus on sharing ideas and developing skills around a given topic of interest.
In Dubai, numerous different meetup groups allow you to interact with people from diverse backgrounds. Examples include:
- Dubai business owners
- Dubai business networking
- Dubai business breakfast
- The women’s business network in Dubai
- The Dubai business meetup group, and
- Dubai small business marketing strategy, among others.
This is just but to name a few. They are many, and you can search online to evaluate and decide on any that resonates with your personality and business endeavors. In these groups, you are bound to find a reliable and trustworthy business partner.