How to open a company in Dubai

How to open a company in Dubai In light of the continuous economic development and simple procedures for establishing companies, Dubai is one of the most attractive cities for investors and businessmen in the world. The question of how to open a company in Dubai is of interest to many individuals and companies seeking to explore business opportunities in this vital economic destination. Whether you are a beginner in the world of entrepreneurship or an experienced investor, understanding the basic steps and procedures required to establish a company in Dubai can be the path towards success and stability in the local and global market.

How to open a company in Dubai

The best types of companies to establish in Dubai

There are many different types of companies that can be established in Dubai, and the choice depends on factors such as business activity, personal strategy, and legislative and commercial requirements. However, there are some common types of companies that are established in Dubai that are very popular, and they include:

Local Company

A local company is considered a company established with local capital and requires an Emirati national partner who owns a share of no less than 51% of the capital. This type of company is suitable for businesses targeting the local market.

Free Zone Company

The free company is considered one of the most popular types of companies in Dubai. Free zones provide a distinct investment environment and enjoy many advantages such as 100% foreign investment, no company tax, and easy customs clearance. Free companies can operate in the UAE market and foreign trade.

1. Foreign Company: Foreign companies can establish branches in Dubai to expand their business activity. Branches of foreign companies are considered complementary to the parent company and must comply with local laws and be linked to the parent company abroad.
2. International Company: The International Company is a company established in Dubai that targets business outside the Emirates. International companies can obtain licenses and facilities to carry out their international activities.
3. Limited Liability Company: A limited company is a common form of company in Dubai. This company provides partner protection and limited liability. Foreign partners can establish and own up to 49% of the limited company, provided that there is an Emirati citizen partner who owns the remaining percentage.

Steps to open a company in Dubai

Opening a company in Dubai requires following a series of legal and administrative steps and procedures. Here are general steps to open a company in Dubai:

1- Determine the type of company: Before starting, you must determine the type of company you want to open. You can choose between several types of companies such as local company (limited liability company), national company, free company, foreign branch, etc.

2- Company name: Select a name for your proposed company and ensure that it complies with local laws and regulations. You may need to consult with the Dubai Business Regulatory Authority (DED) to verify name availability and registration.

3- Location selection: Select a location for your company in Dubai. You must take into account the needs of the company and local laws regarding commercial locations.

4- Licenses and Permits: Determine the type of license you need for your company. You may need licenses from relevant regulatory authorities such as the Department of Economic Development (DED) or the Economic Development Authority of the free zone you are interested in.

5- Retain a legal advisor: It is a good idea to hire a local legal advisor who specializes in business in Dubai to help prepare the necessary legal documents and ensure compliance with local laws and legislation.

6- Company incorporation: Prepare the company’s articles of incorporation and other necessary documents and submit them to the relevant regulatory authorities to obtain approval and register the company.

Legal requirements for opening a company in Dubai

Legal requirements for opening a company in Dubai

There are a set of legal requirements to open a company in Dubai, according to local laws and the Dubai Business Regulatory Authority (DED). However, it should be noted that these requirements may vary slightly depending on the type of company and business activity. Here is an overview of the basic legal requirements:

• Company type: Select the type of company you would like to open, such as a local limited liability company (LLC), a free zone company, or a public joint stock company.
• Partners and Shareholders: You may be required to identify the partners and shareholders of the company and determine the percentage of their shares in the registered capital of the company.
• Company Name: Select a company name and ensure it is compliant with local laws and does not conflict with other registered trademarks.
• Capital: There may be requirements regarding the amount of capital required to open the company, and you must provide this capital or transfer it to the company’s bank account.
• Licenses: You may need to obtain specific licenses based on the company’s activity, such as a general business license, professional license, industrial license, etc. You must submit the required documents and comply with the specific requirements for each type of license.
• Contracts and Documents: Contracts and legal documents must be prepared and signed, such as the company’s articles of incorporation, partner contracts, and other agreements related to the company.
• Visas and Work: If you intend to employ foreign employees, you must obtain appropriate work visas for them.

Business licenses available to foreigners in Dubai

In Dubai, there are several business licenses available for foreigners to open their companies. These licenses vary according to the commercial area and the relevant regulatory body. Here are some common business licenses available to foreigners in Dubai:

• General Trading License at the Department of Economic Development (DED): Allows companies to conduct general commercial activity in Dubai. This license requires a partnership with an Emirati citizen, with the national partner contributing 51% of the capital.
• Company license in free zones: There are free zones in Dubai such as Jebel Ali Zone, Dubai Technology and Media Zone (Dubai Internet City), Dubai Investment Zone (Dubailand), and Dubai Aviation Zone (Dubai Aeroport Free Zone). These free zones provide licenses to companies that allow foreigners to own 100% of the company’s capital, offer advanced infrastructure and facilitate business procedures.
• Foreign Company Branch License: Allows foreign companies to open branches in Dubai. The foreign company must be registered and have a commercial registry in its country of origin, and the branches in Dubai must operate under this registry.
• Sole Establishment License: Allows foreigners to establish a sole proprietorship that they fully manage and own. Local laws and regulations apply regarding establishment and operation.

Administrative and legal steps for establishing and registering a company in Dubai

Here are general steps for establishing and registering a company in Dubai . Please note that these steps are general guidelines and details may vary depending on the specific type of your business and the relevant regulatory body. Before embarking on the process, it is recommended to consult with a legal advisor or accountant specialized in business in Dubai to obtain updated and accurate advice and information:

• Choose the type of company: Select the type of company you want to establish, such as a local limited liability company (LLC), a free zone company, or a public joint stock company. Look at the requirements for each type of company and decide which one best suits your needs.
• Choosing a company name: Choose an appropriate name for the company and make sure it complies with local laws and does not conflict with other registered trademarks.
• Arrange a local partnership (if necessary): If you plan to set up a local limited liability company (LLC), you must arrange a partnership with a UAE national. The percentage of each partner’s shares in the registered capital of the company must be determined.
• Preparing the required documents: Prepare the documents required to register the company, such as the company’s articles of incorporation, partners’ agreement, and other required legal forms. The required documents can vary depending on the type of company.
• Submitting the application and registering the company: Submit an application to register the company with the relevant authority, such as the Department of Economic Development (DED) or the body supervising the specific free zone. There may be a registration fee that applies that you need to pay as well.

Learn how to open a company in Dubai

Opening a company in Dubai is an important process that requires careful planning and follow-up. You need to follow specific legal and administrative procedures to ensure that your company is registered and operated successfully. The steps mentioned in the previous answer provide you with an overview of the process.

Your primary task includes choosing the right type of company for your needs, choosing an appropriate name, and arranging a local partnership if necessary. You must also prepare the required documents and submit an application for registration to the appropriate authority. After registering, you will need to obtain the necessary licenses and open a bank account for the company. Don’t forget to comply with the tax and legal requirements in Dubai.

However, you should know that the exact procedures and requirements may vary depending on the type of company and local laws. Therefore, it is highly recommended that you consult a legal advisor or accountant who specializes in company formation in Dubai to guide you through the process and ensure full compliance with local laws.

Frequently asked questions about how to open a company in Dubai