How to open a company in Dubai

٠٨ مارس How to open a company in Dubai

٠٨ مارس POSTED AT
Uncategorized
itqanadmin

Dubai is one of the world’s most prominent destinations for investment and entrepreneurship, offering a sophisticated economic environment and integrated infrastructure that helps investors achieve success. Therefore, many entrepreneurs are looking for ways to open a company in Dubai to take advantage of the opportunities available in various sectors. Whether you want to establish a company in a free zone or within the local market, Dubai offers multiple options that suit all types of business activities. In this article, we will explain how to open a company in Dubai, focusing on the basic steps and documents required to ensure the establishment of a successful company in accordance with the laws and procedures approved in the UAE.

Table of Contents

How to Open a Company in Dubai

Opening a company in Dubai requires a set of legal and regulatory steps. These steps vary depending on the type of company (mainland company, free zone company, or branch of an international company), but there are basic steps common to all types of companies. Here’s a detailed breakdown:

1. Determine the Type of Business
The first step is to determine the business activity you wish to operate in, such as trade, services, consulting, or manufacturing. This depends on market needs and the sector in which you wish to invest. You must ensure that the activity you choose is permitted in Dubai according to local laws.

2. Choose a Location (Mainland or Free Zone)
Mainland: Requires locating your company within Dubai (office or store) while adhering to certain regulatory requirements.
Free Zones: Offer a flexible environment and benefits such as tax exemptions and fast-track licensing. Examples include Dubai Silicon Oasis and Dubai Financial Services Authority.
3. Choose a Legal Structure for Your Company
You must decide on a company structure that best suits the nature of your business. Options include:

Limited Liability Company (LLC)
Sole Proprietorship
Branch of an International Company
Joint Joint Stock Companies
4. Reserve a Trade Name
Before proceeding, you must choose and register your company’s trade name with the Dubai Department of Economic Development (DED). Ensure that the name does not conflict with other registered names and does not contain prohibited terms.

5. Obtain Initial Approval
After reserving your trade name, you must apply for initial approval from the Dubai Department of Economic Development (DED). This approval confirms that you are able to begin the legal procedures to establish your company.

6. Prepare the Articles of Association
If you are establishing a Limited Liability Company (LLC) or Joint Stock Company, you must prepare a company’s articles of association, which include details such as business objectives, ownership stakes, and partner roles.

7. Obtain the necessary licenses
After receiving initial approval, you must apply for a trade license. The license can be:

Commercial License (for commercial activities)
Industrial License (for industrial activities)
Professional License (for consulting and service activities)
8. Securing a Business Location
You need to determine the company’s location, whether it’s a physical office or using virtual offices in the case of free zones. The address must be registered in the official system of government agencies.

9. Opening a Business Bank Account
Financial procedures require opening a business bank account to deposit the company’s capital and carry out daily financial transactions.

10. Applying for Residence Visas
After registering the company, residence visas can be obtained for investors and employees according to the company’s needs.

11. Employment and Secondary Licenses
If you have employees, they must be hired and the appropriate secondary licenses, such as health and employment licenses, must be obtained.

Business Licenses Available in Dubai

Dubai offers a wide range of business licenses suitable for various business activities, both local and international. The Dubai Department of Economic Development (DED) issues most of these licenses, in accordance with the emirate’s commercial laws. Here are the main types of business licenses available in Dubai:

1. Commercial License
A commercial license is issued to businesses engaged in commercial activities such as retail or wholesale sales, and the trade of physical products. This license includes companies engaged in the sale, import, and export of goods, as well as companies that provide wholesale or distributor services.

2. Professional License
A professional license is issued to businesses that provide consulting or professional services such as law, accounting, business consulting, web design, education, and training. This license does not cover the sale of tangible goods, but is limited to services.

3. Industrial License
An industrial license is issued to businesses engaged in activities related to manufacturing or production. It includes companies that manufacture or modify products, such as factories or workshops, and is necessary for projects requiring industrial or production facilities.

4. Free Zone License
A free zone commercial license is issued to companies established in one of Dubai’s free zones, such as Dubai Silicon Oasis or Dubai Financial Services. This license provides companies with significant benefits, such as tax exemptions and complete freedom to own 100% of the capital.

5. Branch License
A branch license is granted to businesses wishing to establish a branch of an international company or another subsidiary of a foreign organization. The branch can be dedicated to selling products or providing services within the local market, while maintaining the parent company’s name.

6. Contracting License
A contracting license is granted for businesses related to building projects or implementing construction and engineering works. This license includes contracting companies working on construction projects such as residential, commercial, or industrial buildings.

7. Information Technology License
An information technology license is granted to companies working in software, application development, or technology consulting. This license is popular among IT startups and companies providing technology solutions.

8. Tourism License
A tourism license is granted to businesses operating in the tourism sector, such as travel and tourism companies, tour guides, and tour operators. Dubai provides a favorable environment for tourism companies, as it is one of the most attractive tourist destinations.

Documents Required to Open a Company in Dubai

Opening a company in Dubai requires a set of documents to ensure compliance with local laws and expedite the registration process. The required documents vary depending on the type of business activity and whether the company is located in a free zone or mainland. The following are the basic documents required:

1. Company Registration Application Form
The company registration application form issued by the relevant authority, such as the Department of Economic Development (DED) or the selected free zone authority, must be completed and submitted.

2. Copy of Passport and ID
All partners are required to provide a certified copy of their passport, as well as a copy of their residency visa (if applicable) and Emirates ID for residents.

3. No Objection Certificate (NOC)
If a partner is a resident of the UAE and working for another entity, they may need a No Objection Certificate (NOC) from their current sponsor.

4. Business Plan
Some businesses, such as financial and investment services, require a detailed business plan outlining operational objectives and strategies.

5. Company Articles of Association (MOA) and Partnership Contract (if required)
The Articles of Association (MOA) and Partnership Contract must be notarized at the Department of Economic Development or through a notary public, especially if the company has more than one partner.

6. Proof of Company Address
A notarized lease agreement (Ejari) for the company’s headquarters must be submitted, whether it is an office in mainland Dubai or in one of the free zones.

7. Additional Approvals
Some business activities require additional approval from regulatory bodies such as the Ministry of Health (for medical companies) or the Department of Tourism (for tourism companies).

8. Capital Deposit (if required)
In some cases, proof of capital deposit in a company bank account may be required before registration can be completed.

Cost of Company Incorporation in Dubai

The cost of company incorporation in Dubai varies based on several factors, including the type of business activity, the company’s location (mainland or free zone), and the type of license required. Costs are divided into several main aspects, including company registration fees, trade license issuance, office rental costs, and government service fees.

1. Company Registration and Trade License Fees
Company registration and trade license fees are basic costs and vary depending on the authority issuing the license, whether it is the Department of Economic Development (DED) in mainland Dubai or one of the free zone regulatory bodies.

2. Office Rental or Business Premises Costs
Every company must have an official business premises, whether a physical office or a virtual office in some free zones. Rental costs vary depending on the location and size of the space required, with prices being higher in major business areas.

3. Visa and Residency Fees
Upon establishing a company, the owner can apply for an investor visa, which requires government fees including visa, residency, and Emirates ID. Visas can also be issued for employees and workers within the company.

4. Government and Administrative Service Costs
These costs include fees for registering a trade name, issuing a company incorporation certificate, notarizing contracts, and additional approvals required for some specialized business activities such as financial, medical, or tourism activities.

5. Additional Costs and Annual Renewal
After establishing a company, there are some annual costs to consider, such as renewing the trade license, financial audit fees, and operating a business bank account.

6. Hiring Specialized Companies
Investors can expedite the process and benefit from the services of specialized companies in establishing companies in Dubai, such as Itqan, which offers comprehensive solutions to facilitate company formation at competitive costs.

Ultimately, it can be said that opening a company in Dubai is not as complicated as some may think, but it does require a thorough knowledge of the legal procedures and necessary licenses. By choosing the right business activity, fulfilling the required requirements, and obtaining licenses, any investor can establish a successful company in Dubai and benefit from the many advantages the emirate offers. Whether you are a beginner or an experienced investor, Dubai provides an ideal environment for growth and prosperity. Now that you know how to open a company in Dubai, you can take the first steps toward realizing your dream of establishing a successful project in one of the most developed cities in the world.