The United Arab Emirates has long been famed for its beneficial business environment for entrepreneurs from across the world. Its reputation is attributed to various development initiatives launched both in Dubai and Abu Dhabi, including the country's economic growth, an inflow of new investment in real estate, an appealing tax regime, efficient government management, and a reliable banking system. The UAE has become a top destination for many large-scale companies and holdings, while new programmes have promoted the successful development of small and medium-sized enterprises within the country. The distinctive qualities of the UAE include a personalized approach and the absence of monopolies regarding trade and production.
Where Do I Start?
When entering the UAE market, in general, there are no major differences, as niche identification, supply and demand analysis, availability of competitors and other aspects should be taken into account before opening a business. And this applies both to opening a branch of an already operating company in another country, and to launching a new one in the UAE. The majority of foreign business professionals are guided by the experience of doing business in their own country. This is why they consider the UAE as the beginning of a promising new career in a new sector.
Our experts at METROPOLITAN CONSULTING will help you realize your business idea. We will provide you with detailed analysis of the market in your chosen area of activity, tell you about key competitors and assist you with all the required paperwork to successfully open a company in the UAE.
Getting a License
All branches of business in the UAE are strictly regulated. Frequently foreigners find it hard to accept that a company licensed to sell mobile phones in the UAE may not sell other types of goods, like car accessories or food. Additionally, a trading license does not allow a company to provide any services, such as legal or brokerage services, for instance.
One of the nuances of business in the UAE is its segmentation: the license enables you to engage only in the type of activity that it is assigned for. It must be renewed annually, and in select jurisdictions an annual audit report is to be renewed as well. Also, any company that is registered in the UAE must keep accounting records that provide the latest data regarding its assets, liabilities and current financial position.
Peculiarities of the UAE Law
One of the distinctive features of the UAE law is how close both the civil law and Sharia law are connected. Nevertheless, each of the jurisdictions that encompass free and offshore zones has its own legislative and regulation system. Frequently it is based on British law. However, the requirements for company registration in different jurisdictions may have significant difficulties.
Furthermore, additional permits may be required for specific types of activities. For instance, in order to open a dental clinic, it is necessary to obtain the approval of the local Ministry of Health in addition to a regular license, and all doctors must first be certified in the UAE.
Taking the previously-mentioned information into account, there is no universal guidance on how to relocate and open a business in the UAE. The best solution is to seek help from a consultancy company, which will provide tailor-made solutions based on the client's goals and wishes.
One of the first and key steps is to select a business category or jurisdiction. There are 3 options in the UAE, which include mainland, free economic zone (FEZ) and offshore.
You also need to choose one of the types of registration found below:
- Mainland or a local company
- FEZ company
- Offshore company
Is It Possible to Enter the Local Market Without Intermediaries?
It is possible to start a business in Dubai on your own, without bringing in experts. However, this decision is rather risky. Highly-qualified specialists in a consultancy company will help you choose the best jurisdiction for your particular business, and save you time and money.
In addition, consultants usually continue accompanying the company even after registration. They provide assistance in solving any issues in terms of the UAE's labour legislation, accounting and tax accounting and other key directions. It is worth noting that aspects, which may seem very straightforward, tend to cause many obstacles when it comes to the operation of the company.
During all stages of registration and the subsequent running of the business have specific nuances, which are easily solved with the help of an experienced specialist.
One of the most common types of incorporation is a local (mainland) company. The minimum number of shareholders is 2, while the maximum is 50. It is possible to open a legal entity with only 1 shareholder. Registration takes on average 1-2 weeks.