The UAE, owing to its strategic location, robust economy, and business-friendly environment, is a fertile soil to start a business. Just like its Middle Eastern neighbors a commitment to diversify its economy beyond the oil industry further fuels it towards an investment-friendly ecosystem. As a result, the country offers promising avenues in key areas such as technology, tourism, logistics, and finance.
Another leap in this direction that makes this country ideal for expat investments is its free zones that encourage investments with 100% foreign ownership and tax concessions. Its modern infrastructures and access to the international market further expand its horizons with larger scopes. No wonder that the World Bank ranked it 16th in its coveted ease of doing business index.
However, the international relocation services Dubai point out that it is not devoid of procedural nuances. This detailed guide on navigating these nuances will be of help to establishing your business in the UAE.
Steps for ex-pats to start a business in the UAE
Business Planning
Be it UAE or any other part of the world, beginning a business in an unfamiliar business landscape requires proper planning. Such a plan should include a business idea, target market, competitor analysis, operational plan, and a feasibility study to ensure that the business is about to work.
When it comes to business ideas there are amble options from tourism and gastronomy to IT and education. For further planning, it is recommended to get the support of international movers who are well-versed in the business landscape of the UAE.
Selecting a Business Name
This may appear to be a lame topic to begin with. However, the UAE has strict regulations when it comes to choosing business names. Some of these include:
- A Strict No for Offensive or Blasphemous Terms
- Abbreviations that create confusion are generally discouraged.
- The name should clearly represent the nature of the company.
- Names that connote affiliations with the government or the royal family without prior permission are barred.
- The name should ensure that it conveys the same message in English and Arabic. Incorrect translations will lead to rejections.
Once the name is chosen as per the guidelines of the Department of Economic Development (DED) it is advised to reserve the name with DED. This can be done online or in person.
Selecting the License Type
The various licenses available in the UAE include commercial, professional, industrial, and tourism licenses. International relocation services Dubai emphasizes the choice of the right one since each of them is associated with specific activities and regulatory guidelines.
- Professional License: These are issued for entities to run service-oriented businesses like education and IT. The benefit is that it allows for 100% foreign ownership.
- Commercial License: With these licenses companies are expected to run trading activities which include retail, general trading, or the import and export of goods. In the case of mainland companies, it is required to have a local sponsor with 51% ownership.
- Industrial License: This license facilitates businesses to pursue manufacturing or industrial activities. Among its requirements, a physical warehouse is a must to have.
- Tourism License: As the name suggests these licenses support tourism activities like travel agencies and hospitality services. Unlike other licenses regulated by the DED, this one is controlled by the Department of Tourism and Commerce Marketing (DTCM)
Choosing the Area of Operation
It includes three choices, namely free zones, mainland zones, and offshore zones. The free zones provide for 100% of ownership whereas the mainland zone requires a majority share to be owned by a local sponsor. However, the latter gives the flexibility to operate anywhere in the UAE mainland. Meanwhile, offshore companies are restricted from operating in the UAE mainland. However, companies that operate on this framework are exempted from corporate tax and have the privilege of privacy from mainland regulators.
License Application
Once all the necessary documentation such as the Memorandum of Association (MOA), passport copies of shareholders, and tenancy contracts for office spaces are arranged, you are ready to submit the license application. Also don’t forget to consult with your international relocation services Dubai before submitting, to ensure that no documents are left behind. Once submitted the concerned authority like the DED to which the application is made takes about a week to a month to process the application. It depends on the type of license as well as the unique situation of the applicant. Remember that it requires a fee to be paid. It may range from AED 10,000 to AED 50,000.
Opening a Corporate Bank Account
This is essential to manage company finances and receive payments. Make sure to compare a couple of banks in the UAE for competitive performance before signing up. Ensure that you have the requisite documents upon visiting the bank. This may include business licenses, MOA, and passport copies among others. Work with your international movers and bank for a detailed list of requisite documents.
Once these essential steps are completed you can confidently go forward with hiring and the application of visas for your employees.
Now that you are aware of the process for setting up a business in the UAE and the relevance of international relocation services in delivering the requisite support it is time to choose the right moving partner. Only a partner with expertise in business setup should be hired in this case. With proven expertise in helping innumerable businesses to successfully get established in the Emirates Helpxpat will be your ideal partner. You can reach out to us anytime to leverage our valuable services.
