Business Setup in Dubai  | Company Registration in Dubai

As one of the giants in the Middle East, Dubai City offers many business opportunities to foreign investors. Because of that, such foreign establishments set up different kinds of businesses in Dubai. It has expanded its region's opportunities for constant trade and business development. Despite being an Oil-rich country, Dubai has diversified its economy from oil production, which now only accounts for less than 1% of its economy.

With rampant diversification and economic growth in the Middle Eastern City, the Dubian Authority has issued nearly 46000+ business licenses in the first half of the fiscal year 2022. This figure is significantly higher than the issued licenses in the previous year, showing a quarterly growth in Company Registrations in Dubai. You can account for the growth of Businesses in the economy to the following:

• Business-friendly Corporate Policies
• Corporal Tax Regimes
• City’s Infrastructure

From the aforementioned points, you can say that Dubai is MECCA for starting new businesses. Therefore, Setting up a Business in Dubai can benefit business owners and entrepreneurs, especially foreign nationals.

Types of Registration of Company in Dubai

The following are the different types of dubai company registration:

Free Zone Companies

The free zone business setup Dubai is different from mainland companies because these are situated in the Free Trade Zones where different laws implement related to taxation, customs, ownership, etc. In the free zone, the owner has complete ownership and their entrepreneurs can establish two types of Dubai companies; Free zone establishment and Free zone company.

Limited Liability Company

To form an LLP in Dubai, a minimum of 2 shareholders and a maximum of 50 shareholders are required. The liability of the members is required for their capital contribution. Except for banking, insurance, or investment, an LLC Dubai company can carry any kind of business. 

Onshore Company

An onshore company is set up in the mainland of Dubai which is managed by the Directors. Recently the Dubai government has notified that now foreign entrepreneurs also have 100% ownership and complete authority to participate in business activities. But first was limited to 49% ownership for foreign investors.

Offshore Company

A business that is run outside the jurisdiction of a company is known as an offshore company. An offshore company formation in Dubai is completely done by foreign investors who have 100% ownership of the business. 

Branch Office

It is a part of the main branch of any company. Branch offices can be set up on the mainland or in the free trade zone. This is the best way to expand the business in the local market and reach the local customer base.

Benefits of Company Registration in Dubai

The following paragraphs have detailed some of the benefits of company formation in Dubai.

Why Must You Register Your Business as a Company in Dubai?

We have enlisted some of the major benefits of registering your Firm as a Company in Dubai. So let us look at them one by one.

1. Business-friendly Environment of Dubai

The UAE Government has rapidly adopted technology for business incorporation procedures in Dubai. It has made the company registration process very easy in Dubai. An applicant can easily complete the procedure in a few days. The incorporation requires almost no paperwork, and the online steps are easy, even for the novice.

2. Complete Business Ownership to Foreign Nationals

The Emirate Authority introduced certain amendments in the Commercial Companies Law of UAE last year, allowing foreign investors to have complete ownership of their businesses. This is a major step forward in inviting more Foreign Investors into the Gulf City. Foreign investors and establishments conduct more than half of Dubai's total economic activities.

3. Availability of more than 30 Free Zones in the Gulf Region

The investors from Foreign Lands can set up their companies in the Dubai Mainland Area which consists of Free Zones. Free Zones are the regions where doing Business allows a 100% ownership of the Business to the Foreign National and complete profit claim with provisions of repatriation and capital invested without any tax cuts. Dubai provides more than 30 Free Zones for budding entrepreuners as well as investors from all over the world. The investors can further collaborate with the other players in the same economic sector.

4. Flexible Tax Regime and Tax Benefits to Corporate Entities in Dubai

One of the major benefits of registering your Business as a company in Dubai is that the company need not pay any taxes. The Authority levies no corporate or personal taxes in Dubai. Although, a few companies are liable to pay the VAT (GCC) at 5% on specific business activities, as applicable by the Dubai Corporate Laws.

5. Strategic Geographic Location of the Gulf City

Dubai City has a strategically advantageous location as it sits on the crossroads connecting from all directions of the sea and land. Also, the City is one of the biggest re-export hubs in the world. With one of the world's most active and busiest airports/seaports, Dubai also boasts one of the most efficient logistics infrastructures. The UAE government has invested greatly in making Dubai one of the world's greatest tourist hubs.

6. City’s Advanced Infrastructure

Dubai has one of the most developed and advanced infrastructures in all of Central Asia. Boasting of possessing one of the world's best infrastructures, Dubai’s logistical capabilities are ever-evolving. It offers excellent public transportation, telecommunication facilities, and public terminals. The Dubai Expo 2020 showcased significant advancements the City has made in its overall infrastructure.

Who undertakes Company Registration activities in Dubai?

The regulatory Authority for Company Registration in Dubai is the Department of Economic Development (DED). Businesses must file their new applications for company registrations with the DED. It is where the companies have to file their compliances and registration applications.

Connect with our Dubai company incorporation experts to fulfill your dream of owning a business in UAE.

Eligible Criteria for Setting up a Business in Dubai

A business aspirant for Company Registration in Dubai must choose a relevant business structure before applying for the business license. Following are the business structures availed by the RoC in Dubai which the entrepreneurs can adopt:

Limited Liability Company (LLC)

• In a Limited Liability Company (LLC), the shareholders have limited liability for the company. They are liable only to the extent of their contributions to the share capital.
• To set up an LLC, the applicant needs sponsorship from any of the following to act as a National Agent or Sponsor:
  • UAE National
  • Wholly-owned UAE company
• For LLC registration, there is no minimum capital requirement. However, the LLC must have AED 100,000, as per the general market standards.
• The UAE Authority does not mandate any income tax on Corporates unless they are involved in some high economic activities such as oil, natural gas, etc.
• The Authority mandates a physical office space for the company’s registration.
• The applicant must maintain a minimum of one Director or Manager.
• The Authority puts no constraints on the repatriation of funds.
• But, the applicant company must maintain a legal reserve of 10% of the net LLC's profits. 

Branch Office

• A branch office in Dubai is just an extension of the parent company
• A Branch is not a separate legal entity.
• Any local or foreign company can set up its own branch office in Dubai, both on the Mainland and in Free Zones across Dubai.

Joint Stock Company

• A Joint Stock Company in Dubai divides its capital into negotiable shares.
• Each of these shares must be of equal value.
• In a Joint Stock Company, a company’s partner is liable only to the extent of its contribution to sharing capital.
• The Registrar defines two types of Joint Stock companies in Dubai
  • Private Joint Stock Company
  • Public Joint Stock Company
• A JSC in Dubai must have a minimum of 2 and a maximum of 15 directors.
• Each director must be elected for a minimum of three years.
• The majority of the Applicant Company’s Board, including the chairman, must be UAE nationals.
• A public Joint Stock Company must maintain a minimum share capital of AED 10,000,000,
• A public JSC must maintain a minimum of 10 founders for incorporation.
• In contrast, the private Joint Stock Company must maintain a minimum share capital of AED 2,000,000 and a minimum of 3 founders for the incorporation procedure.

Free Zone Companies

The Free Zone companies in Dubai are situated in a Free Zone.

There are special laws related to the following in the designated Free Zone:

• Customs
• Taxation
• Ownership

Free Zones are distinct from mainland Dubai.

There are two kinds of companies that can be established in a Free Zone area:

Free Zone Company

• For a Free Zone Company or an LLC, it has multiple shareholders, maximum of upto five.
• Both natural and legal persons can incorporate a Free Zone company.
• The legal requirements required for Free Zone LLC incorporation are the regulations framed by the respective Free Zone and not the Union Authority.

Free Zone Establishment

• Free Zone Establishment must have a single shareholder with limited liability.
• Both natural and legal entities can incorporate a Free Zone Establishment.
• The legal requirements for Free Zone Establishment incorporation are the regulations framed by the respective Free Zone and not the Union Authority.

Dual License Branch Office

• A Dual License branch office is an extension of a Free Zone Company.
• The Branch is situated in the mainland area of Dubai.
• These Branch offices hold an additional license in addition to the Free Zone incorporation license
• A Dual Branching license reduces the cost and duration of incorporating a separate company in the Mainland Area.
• The mainland office is not a subsidiary but a branch office of the free zone company. Therefore, it must not appoint a Local Sponsor.
• Dual Branch Offices cannot register themselves with the UAE Ministry of Labour. Therefore they are not eligible to issue labor permits. Its staff is free zone resident visa holders.

Trade Representative Office

• A Representative Trade Office is an extension of its Parent Company in Dubai.
• It is not an independent entity.
• Trade Representative Office is permitted to perform limited functions.
• They collect information for projects completed by the parent company
• They also act as Dubai's marketing and administrative center.
• To establish a Representative Trade Office, the applicant must appoint anyone of the following:
  • UAE national agent
  • Wholly-owned Company of UAE nationals
• Trade Representative Office cannot purchase any UAE property under its name.
• Every Trade Representative Office applicant must deposit a Non-Refundable Deposit of AED 50,000. The deposit amount must not be used as working capital.

Documents for Business Setup Services in Dubai

Every Company Registration applicant in Dubai must draft and compile the following documents to be submitted with the Company Registration application in Dubai. The listed documents further the candidature of the applicant for Company Registration in Dubai:

Initial Approval

• Duly Filled Company’s Name Reservation Application form
• Application Form for initial Business License approval
• Well-drafted Business Plan of the applicant Company
• Copy of the Existing Registration Certificate as well as trade license, in case the Company is already registered in Dubai
• Audited Financial Reports for the Last Two Years of the applicant's corporate entity
• Board resolution of the applicant company
• Corporate Documents of the applicant Company’s Shareholders
• Recent colored passport copies of the applicant company’s shareholders, as well as its appointed Directors and Managers
• Specimen or Digital Signatures of the applicant company’s shareholders as well as its appointed Directors and Managers
• Business Operations and Conduct Details
• No Objection Certificate from the Local Sponsor, if applicable
• RIC Form (Registry Identification Code) for Directors and Managers, both original and notarized
• The chosen name of the applicant company, the applicant must give at least 3 options to the RoC
• Entry stamp
• Visa Page of the applicant
• Copy of the Passports of the Applicant Company’s Personnel

Freelancers as a Company in Dubai

The Freelancers wanting to work as a Company in Dubai must submit the following documents:

• Completed Registration Application Form
• CV of the freelancer
• Applicant’s Bank reference letter
• Original as well as notarized RIC Registry Identification Code

For Company Formation in Dubai

Once the applicant obtains the initial approval, the registration and licensing fee payments are next. This fee depends on the commercial activity undertaken by the applicant company and the required license type. The applicant must submit the following documents required for registration:

• Duly filled Company Registration Application Form
• Share Capital Information of the Company

The applicant must notarize as well as attest the following documents for company registration:

• Board Resolution for appointing the Directors and Managers in the Company
• Memorandum of Association of the proposed company
• Articles of Association (AOA) of the proposed company
• Power Of Attorney for the Director or Manager of the proposed company
• Passport-size photographs of all the Managers and Directors of the company

Procedure for Setting up a Company in Dubai

Every Company aspirant must follow the procedure detailed in the following for Company Registration in Dubai:

1. Choosing the corporate structure for the applicant’s Business
2. Choosing & reserving the trade name of the applicant’s Business
3. Applying for the Business License
4. Deciding the location of the applicant’s Business in Dubai (Mainland or Free Zone)
5. Acquiring an office space for the applicant’s Business
6. Obtaining the appropriate business licenses from the UAE Authorities
7. Opening a bank account in the name of the newly registered company

Choosing the Business Structure for the Applicant’s Business

The applicant must decide the appropriate corporate structure for the proposed company. The applicant can adopt any of the following structures:

• Limited Liability Company (LLC)
• Branch Office
• Joint Stock Company
• Free Zone Company
• Trade Representative Office

There are a number of factors on which selecting a suitable business structure depends, such as:

• Number of shareholders
• Commercial Activities undertaken by the proposed company
• Capital Requirements of the Applicant Business

Choosing & reserving a Trade Name for the Applicant’s Business

The next step is reserving a name under which the company will undertake its business activities. Firstly, the applicant must confirm the chosen name's availability with the UAE’s Department of Economic Affairs. In the case of a Free Zone area, the concerned Free Zone Authority must be consulted. The applicant must ensure that the chosen name is in accordance with the law of the land. The name must not be taken by some other registered company.

Directions for the Nomenclature

• The chosen name must not violate the public morale or disturb the peace within the country
• The chosen name must be as per the Legal Form of the company
• The chosen name must not have been previously registered with the RoC
• The chosen name must be in accordance with the business activities undertaken by the applicant's Business.
• The chosen name must not contain the name of any of the following:
  • Religion
  • Governing Authorities
  • Logos of any External Body
• The chosen name must not be controversial, derogatory, or insulting.
• The chosen name must reflect the name of the person and not their nickname if the applicant chooses the names of the entrepreneurs as its trade name.

Applying for the Company’s License

After reserving the name with the Authority, the applicant must apply for a business license per the business activities the proposed company wishes to undertake in the Gulf City. The Company license is a legal document that authorizes its holders to conduct their business operations as mentioned in the licensing certificate.

Types of Business Licenses in Dubai

The Registrar of Companies issues the following business licenses in Dubai:

Commercial Business License

The commercial license is issued to those business entities wishing to engage in commodity’s or service’s trading.

Industrial Business License

The Industrial license is issued to those business entities wishing to engage in the activities of production as well as industrial operations.

Professional Business License

The professional license is issued to those business entities wishing to offer professional services, technicians, or artisans.

Registering the location of the proposed Company in Dubai

Your choice of office location can be a game-changer for your business profits. Therefore, you must choose your office space wisely. The entrepreneur can either buy the office space or lease the land. In Dubai, the office space selection depends on the following:

• Kind of business activity undertaken
• Number of employees
• Budget allocated for the Office Space

Different Free Zones in Dubai offer different office sizes ranging from 20-30 sq. to 2000 sq. m. and beyond. You must take your pick.

Obtaining the appropriate Business Licenses from the UAE Authorities

The respective laws of the jurisdictions govern the newly registered Companies at a designated place. Accordingly, new Companies must apply with the appropriate documents to obtain the required permits from the concerned Authorities in UAE, such as:

• Pre-Approvals
• Business Registrations
• Appropriate Business Licenses

The required documentation depends on the following:

• Kind of Business Activities undertaken
• Company's Location
• Company's Corporate Structure

Opening a Corporate Bank Account for the Newly Registered Company

Once all the required approvals have been obtained from the UAE Authorities, the newly incorporated Company must register for and maintain a Corporate Bank Account under its tradename. This Account will be used for receiving as well as sending funds in furtherance of the company’s affairs.

Our Assistance in Business Setup in Dubai

Our Incorporation experts provide you end to end company formation services in Dubai by assisting you in the following manner:

• Collecting and organizing the Documents
• Applying for the necessary document for registration
• Drafting the Articles of Association
• Drafting the Memorandum of Association
• Filing the application for a business license in Dubai
• Obtaining and forwarding the Company License to the applicant
• Opening the Corporate Business Account for the newly incorporated Company

We ensure that your company incorporation services requirements for Dubai are always on time. Our professionals understand the intricacies of company incorporation procedures in Dubai. Thus, we have expedited the process – helping you incorporate your Company at an affordable price.

So, reach out to our Incorporation Experts and realize your dream of Business Setup in Dubai.

Frequently Asked Questions (FAQs)

Q. Is a company setup in Dubai by a foreign National possible?

A. Yes, you can set up a company in Dubai with 100% ownership and repatriation benefits. Also, you don’t need any local sponsor to set up a business in Dubai.

Q. Can I register a company in Dubai without living there?

A. Yes, you can register a company in the free zone of Dubai, UAE without being physically present in Dubai. Anyone from any country can set up a business in Dubai.

Q. Is it hard to register a company in Dubai?

A. Process of registration is not tough to complete, especially in the free zone but for the mainland. It is advisable to consult with a professional. Reach out to Registrationwala.

Q. How long does it take to register a company in Dubai?

A. To establish a business in Dubai, UAE, it takes around 4 to 5 working days. However, in the case of a free zone company registration, it can take 3-5 days and for the mainland, ten days are required to register a business.

Q. Who are the best Business Setup consultants in Dubai?

A. Registrationwala offers one of the best mainland business setup services in Dubai. Connect with the Incorporation experts at Registrationwala. Our seasoned experts can guide you throughout the registration procedure.

Q. How long does license renewal take?

A. The registration license will take about one week to be renewed and you have to send the following documents along with the renewal application:

1. BR/1 Form signed by the shareholder(s)
2. Passport and visa copies of the shareholder(s)
3. Your business’ lease agreement (if applicable)
4. A copy of your previous trade license

Q. Can you own 100% of a company in Dubai?

A.  As per the new amendment of UAE, the new investors or businesses can set up a business with 100% ownership. To read more about this, check the article here.