How to start a business in Dubai: A basic guide for expatriates

Business Featured

Dubai has come a long way in making itself a successful business center, and one of the most liberal business regimes in the world. With better infrastructure, numerous free zones, its strategic location, tax-free regulations, and low import duties, Dubai scores ahead of many cities in terms of ease of doing business. It is home to both multi-million-dollar conglomerates and startups. All these factors attract a lot of new investors to Dubai.

If you wish to set up a company in Dubai, then the below steps will come handy for you.

How to start a business in Dubai

Select a Business Activity

Selecting a business activity is one of the key decisions to start a company in Dubai. Do your market research, check for the demand for your products or services that you are offering. Understand the practicality and the feasibility of your business and then choose the right activity accordingly.

Select the Jurisdiction

Location is key for any new business in Dubai. The UAE Market is divided into three jurisdictions. The three different zones are mainland, free zone, and offshore. Selecting a jurisdiction completely depends upon the requirements of your business activity.

Decide the Company Structure

Deciding the structure for your business at an early stage will help you to provide a proper layout for your company.  Depending upon the resources, finance, and nature of your business you can form a general trading, limited liability, or a partnership-based company.

Choose a Trade Name

The next step for starting a business in Dubai is choosing a trade name and activity approval from the Department of Economic Development. Here are a few guidelines for choosing a good Trade name.

  • Must be a proper name, should not contain any indecent words
  • It should not include God’s name
  • The name should not contain the name of the country or government unless you have approval
  • It should strictly indicate business activity
  • DED has the right to cancel or change the name if a similar existing name is found
  • The trade name is valid for 6 months only and costs AED 620

Apply for Initial Approval

If you wish to set up a company in Dubai mainland, you will need to apply for an initial approval certificate from DED. It is a certificate which states that DED has no objection to you starting a company. Documents required for initial approval are as follows:

  • Business registration and licensing form
  • Copy of the passport/ ID and visa
  • NOC from the applicant’s sponsor
  • The company’s articles of association
  • Feasibility study of the project
  • The parent company’s board NOC to open a branch in Dubai
  • Letter of authorization of the managing director
  • Copy of the parent company’s commercial registration certificate
  • Copy of the parent company’s memorandum of association (MOA)
  • Copy of the parent company’s license

You can apply for the initial approval through e-Services, Business in Dubai App, Service centers, Happiness Lounge, Law firms, business setup consultants, etc.

Prepare the Memorandum of Association

Depending upon the legal form of your business, all the partners may need to draft and sign an MOA. If you are registering a branch of an existing company then you will need a copy of your existing MOA. It is not required If your company is a Sole Establishment or an Intelaq license holder.

Establish an Office

There must be a physical address for all businesses in Dubai. Sign your tenancy contract and register with Ejari for attestation. To register an Ejari you will need your initial approval certificate, copy of passport, visa and Emirates ID. Once your contract is attested by Ejari, submit it to DED to proceed with issuing of trade license.

Get External Approval

Some business activities require special licensing approval from different government departments. Eg. If you want to set up a clinic, approvals from DED is not enough. You will also need approval from the Dubai Health Authority. Based on your business activity, contact the relevant government departments to find out what documents they need for approvals. You can always check the external approvals list which is updated regularly by the Business Registration and Licensing Section in DED.

Collect your Business License

Submit the License Application, MOA, attested company agreement, governmental forms, name reservation certificate, initial approval certificate, EJARI registration certificate, tenancy contract, approval from external departments, passport copies of partners and NOC for partners to the Department of Economic Development (DED). The DED will then issue the payment voucher, which you are expected to pay within 30 days of receiving the voucher. You may then, collect your license upon payment.