Registering a company in Dubai [2019 Guide]

Woman signing a contract

Registering a company in Dubai

Dubai has long been an international business hub. Entrepreneurs from every corner of the globe flock to do business here. And there are plenty of great reasons to do so. The Emirate, and indeed the wider UAE, is famed the world over for its incredibly attractive tax regime – 0% on both personal and corporate income.

Then there is the Emirate’s location to consider – perfectly placed between the thriving markets of East and West. Dubai is also home to world-class infrastructure, state-of-the-art facilities, and a supportive business environment home to any number of startup incubators and grants designed to help small businesses get up and running.

And there’s another reason why so many international entrepreneurs choose to do business here too: Registering a company in Dubai is both straightforward and affordable.

Registering a company in Dubai in 2019

One of the first steps when registering a company in Dubai is to do decide on the nature of your business activities. These activities will have a large bearing on the type of setup you choose (free zone or mainland), and the type of business license you require.

You are only permitted to carry out the activities listed on your business license. However, there are many activities to choose from and it is often possible to carry out multiple activities under a single license.

To select your activity, you must choose from the list published by the Dubai Department of Economic Development (DED). The DED list contains over 2,000 activities across a range of industries including everything from consultancy to classic car or sportswear trading.

To select your activity, you must choose from the list published by the Dubai Department of Economic Development (DED).

Choosing a business name

With your activity decided upon, the next step is to choose a name for your business. While this is often something that many entrepreneurs take for granted, it’s a very important step in the company formation process – particularly in the UAE.

Here, as well as choosing a name that is memorable and conveys the essence of your brand, you must also adhere to strict naming conventions. These are rather easy to abide by, however. In short, you should not include any offensive or blasphemous words in your business name, nor should it include the name of any famous organisations such as the CIA or NASA. There are a few more minor considerations too but a company formation specialist can help you navigate these to ensure your chosen name meets the criteria.

The final step is to check that your chosen name is available to register. Once again, a company formation expert can do this for you.

 Free zone or mainland?

Another hugely important step in the company registration process in Dubai is deciding whether to set up in a free zone or on the mainland. There are definite benefits to each.

Companies in the mainland can trade directly with the local UAE market – something that free zone businesses can only do with the assistance of a local service agent. Mainland companies may also have more scope to grow as they are not tied to the premises at their chosen free zone nor do they have a cap on the number of employee visas they can apply for.

Landscape of Dubai

Mainland businesses are also able to take on government contracts – often a rather lucrative line of work in the UAE. What’s more, rules on foreign ownership are being relaxed meaning it is possible to establish a mainland company and retain 100% ownership in many cases.

Free zone companies on the other hand cannot take on government contracts or trade directly with the UAE market. However, free companies benefit from no currency controls, the option to fully repatriate profits and capital, 0% tax on corporate and personal incomes, 100% customs tax exemption and 100% foreign ownership in all cases.

The type of setup that is right for you will depend on the nature of your business and your plans for the future. Again, a company formation specialist can help you when making this decision.

Applying for your licence

Now that you know exactly what you are going to do and where you are going to do it, it’s time to apply for your license. There are several main license types available in the UAE:

Commercial: The commercial license is issued to companies engaging in trading activities. Industrial: As the name suggests, the industrial license is for businesses that carry out industrial activities such as manufacturing.

Professional: The professional license is issued to professional services companies and service providers.

All of these licenses can be applied for either directly from the DED or via the free zone of your choosing. The eligibility criteria and requirements for applying for your license will depend on which setup you choose and the activities you wish to undertake. However, in most cases, you will – at the very least – be expected to provide the following:

  • Completed application form
  • Copies of the passports of any owners/shareholders
  • Two colour passport size photos

Applying for your visas

As well as applying for your license, you’ll also need to apply for a visa when establishing a business in Dubai. You can handle this directly with the relevant immigration authorities or apply as part of your free zone license application. In either case, it is vital that your application contains no errors and is completed correctly. That’s why it is a good idea to work with a company formation specialist at this stage who can manage the visa process on your behalf.

That’s why it is a good idea to work with a company formation specialist at this stage who can manage the visa process on your behalf.

It’s also possible to apply for employee visas when starting a business in Dubai. The amount you can apply for will depend on whether you set up in a free zone or on the mainland and the size of your business premises.

Finally, it is also possible to sponsor your dependants for their UAE residency visas too. Whether you are looking to support a spouse, child, parent or domestic staff member for their application, the process is easy.

Dubai company registration cost

The exact cost of registering a business in Dubai will depend on a number of factors including your chosen setup (free zone or mainland), the number of visas required, and your chosen business activities.

As a guide, however, you can expect to pay in the region of AED 10,000 to 15,000 for a business license in Dubai.

This could be less if you opt for a freelancer or flexi-desk package – the latter affords you the use of business facilities such as desk space, meeting rooms and call answering on an ad-hoc basis. On the other hand, you should expect your costs to increase if you are setting up a business that requires multiple employee visas and a large premises such as a warehouse.

Starting a business in Dubai

While starting a business in Dubai may be straightforward, if you are unfamiliar with the process, there is a risk of inaccurate applications and subsequent delays.

With the help of a company formation specialist, however, your business could be up and running within a week. All that is required of you is some basic documentation – such as passport copies and your application form – and a little of your time. Then you can rest assured that your application is both accurate and complete.

A company formation specialist can take care of everything, helping you decide between free zone and mainland, managing your entire license and visa applications, and even helping you open your corporate bank account.