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How can setting up a company in the United Arab Emirates help you? go to sea is a way to regain financial freedom and starting a business in top Dubai is the smartest move. Our comprehensive overview covers everything there is to know about UAE company setup.
The United Arab Emirates is always open for business. Incorporating a company in the UAE is a much more streamlined process if your jurisdiction puts obstacles at every step. The United Arab Emirates is the new frontier for ultra-high net worth individual investing.
If you are considering starting a business in the UAE, our holistic approach will help you do business quickly and efficiently. contact us Start your journey to financial freedom.
UAE Country Profile
The United Arab Emirates is a country made up of seven independent emirates. Of these, two of the most important are Abu Dhabi, home to the region’s largest oil industry, and Dubai, whose port city of the same name has become a global center of commerce. The population in 2023 will be 9.26 million.
United Arab Emirates – Climate
In the UAE, the heat is inevitable. A hotter, drier interior borders a hot, humid coastline. Many tourists head to Dubai to get a tan, and its warm business atmosphere invites you to dive in rather than head in.
United Arab Emirates – Culture
The UAE has one of the largest expat communities in the world. It is built on a foundation of hospitality and tolerance. Nationals from more than 200 different countries live in the United Arab Emirates, a truly multicultural country, although people still respect traditional Arab and Islamic values.
United Arab Emirates – Economy
Abu Dhabi, the capital of the United Arab Emirates, relies on oil, while Dubai has diversified. The establishment of free zones in the UAE has facilitated the growth of foreign companies.
According to the Dubai Digital Economy Chamber, the UAE’s digital economy is expected to reach $140 billion by 2031 and boost the industry’s contribution to the country’s GDP to more than 20 percent.
Benefits of setting up a company in the UAE
The United Arab Emirates knows what it wants, foreign investment, and how to get it, enticing incentives. Unsurprisingly, it has attracted the world’s leading investment firms to open offices in the UAE.
The Government of the United Arab Emirates is committed to advancing their approach to doing business in the UAE. They pioneered the Bashr service for setting up companies online.
this Comprehensive Electronic Services Allows investors to set up companies in the UAE within 15 minutes through a unified online platform. The platform connects with federal and local government entities to provide business licenses.
Abu Dhabi Business Center provides investors with instant permission to start a company online. They do not need to travel to the UAE to obtain a business license in person to obtain a business license.
Other Dubai government entities in Dubai economy and management related sectors launched Dubai Virtual Business City Project For global entrepreneurs and investors. This allows investors to open a virtual company in the UAE even if they do not reside in the UAE.
Previously, the UAE required at least 51 percent of a company’s shareholders to reside in the country.However, according to Amendments to the Business Companies Act, which is no longer the case. Today, you can form a limited liability company in the United Arab Emirates with 100% of its shareholders residing abroad.
By starting a business in the UAE, you open the door to acquire a company UAE residency visa.
UAE is well known zero tax countryHowever, things have changed with the announcement of the new corporate income tax 9% in June 2023.
However, a free zone company can maintain a 0% tax rate by fulfilling certain conditions. There are also many tax exemptions available to businesses operating across strategic sectors.
Navigating through the rules and maintaining your zero-tax status can be confusing. Become a Nomad Capitalist Client, we’ll analyze which tax regime is right for you and your new business. We’ll also take care of all the paperwork and make the process simple and straightforward.
Requirements for starting a business in the UAE
The UAE is divided into three distinct economic zones:
- Mainland UAE
- UAE free zone
- offshore
Each of these jurisdictions caters to different business needs. Although there are differences in the company formation procedures, it is generally similar to the following mainland templates.
Identify business activities
Your business activity is the basis for choosing the legal form and type of license, be it commercial, industrial or professional, etc. Deciding on a business activity is like laying the first brick of a house. There are six types of licenses. They are:
- industrial
- commercial
- professional
- tourists
- agriculture
- Professional
If you find it hard to decide what kind of business to do in the UAE, don’t worry. A A company can have more than one business activityThere are more than 2,000 business activities to choose from in the UAE.
choose legal form
When you reach this stage, you need to realize that the legal form must match the business activity. Choose from one of the following legal forms that can be established in the UAE mainland, free zone and offshore:
- General Partner
- limited partnership
- limited liability company (LLC)
- Public Joint Stock Company (PJSC)
- Private Joint Stock Company (PrJSC)
- private company
- local company branch
- GCC branch
- Branches of foreign companies
- Free Trade Zone Company Branch
- sole proprietorship
- holding company
Choose the option that best fits your company’s functions and provides the best benefits.
Choose a trade name for your business
The company name must comply with strict naming conventions in the UAE. Otherwise, the relevant economic department will not approve your company name. The business name must:
- followed by the acronym of the company’s legal form, if applicable, such as LLC, EST, or PJSC
- Not contrary to public morals or order in the UAE
- Consistent with the type of activity required and the legal status of the company or business entity
- Exclude the name or logo of any religion, governing body, or any external agency
- Not registered before.
The local Ministry of Economic Development registers the trade name, while the Ministry of Economic Affairs registers the trademark.
Seek initial approval from government authorities
Initial approval does not automatically imply reliable approval. Rather, it means that you are on the right track to establishing a business in the UAE. Interpret the preliminary approval as an indication by the UAE government, through the Ministry of Economic Development or the respective free zone authority, that it is willing for your company to be established in their country.
It also allows investors to proceed with the next steps in the business. However, preliminary approval does not give you full authority to operate or carry out business activities.
Complete and sign the Memorandum of Association or Local Service Agency Agreement
Depending on the legal form of the business, you will need to complete and sign a Memorandum of Association (MoA) or a Local Service Agency Agreement (LSA). You will need to submit a MoA for the following business legal forms:
- limited partnership
- limited liability company
- public joint stock company
- private joint stock company.
Only law firms, courts and notaries in the UAE are authorized to prepare and certify letters of agreement and agreements.
Identify your business location
All UAE companies are required to conduct business from a physical address. These sites must meet the requirements set by the Ministry of Economic Development of the specific emirate, as well as the land planning regulations of the local municipality.
If you do not own the office space and warehouse, you will need to provide proof of lease agreement. Some emirates require these agreements to be notarized.
Obtain additional government approvals
In some cases, additional approvals from other government entities that regulate specific business activities are required. For example, the Home Office issues additional approvals for activities related to general transport, such as driving schools, fire fighting equipment, alarm and security systems, used car dealerships, used car parts and car rentals.
The Ministry of Justice is responsible for legal activities, while local municipalities are responsible for architectural and engineering matters.
Travel and tourism, including car clubs, charter air transport and foreign company branches, is the purview of the executive committee, while the Ministry of Economy oversees insurance activities.
Then there is the Telecommunications and Digital Government Regulatory Authority, which oversees telecommunications activities. Local councils are responsible for building and engineering matters.
Obtain a business license
Foreign investors can now pick up a business license from the relevant Ministry of Economic Development Service Center or obtain an electronic copy online. They will need to submit documents to enable them to engage in business activities in the UAE:
- Initial approval receipt and previously submitted documents
- Copy of rental contract certified by Dubai Real Estate Regulatory Authority (RERA)
- Memorandum of Association or Local Service Agency Agreement
- further official approval
You will need to pay your trade license fee within 30 days of receiving the request. Otherwise, your application will be void.
Starting a Business in the UAE Conclusion
The low corporate tax rate of 0 to 9% is one of the most attractive aspects of doing business in the UAE. The company formation and application process is easier and more straightforward than in other countries.
Being able to set up your company digitally or physically makes the UAE unique. Most countries have residence or other restrictions on setting up a business overseas.
However, the process can be a bit confusing and no one wants to go through this type of process without help. Our team at Nomad Capitalist has helped thousands of clients make the best decisions for their business, family and personal goals. become one of our clients Let us help you achieve your goals and spend your most precious money and time.
Preliminary approval is a critical step for doing business in the United Arab Emirates
Doing Business in the UAE FAQs
Yes. For example, many foreigners choose to start a business in Dubai. Expats make up more than 80% of the population, some of whom own their own businesses. Dubai encourages overseas investors and business owners to set up shop in Dubai.
The Department of Economic Development offers six trade licenses. There are industrial licences, commercial licences, craft licences, tourism licences, agricultural licences, and professional licences.
Budget between 20,000 and 30,000 AED (approximately $5,446 to $8,169). The cost of forming a UAE company is directly proportional to the additional privileges you require. Therefore, additional approvals by foreign trade names or governing entities can increase prices.
Starting a business in Dubai is a breeze. The city has solidified its status as one of the top startup locations. A business-friendly culture and innovation are drivers of Dubai’s continued relevance in the startup world.
We can help you with more than just starting a business in the UAE. our overall plan Will help boost your economy and include instructions on when and where to open a corporate bank account.
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