The United Arab Emirates has cemented its position as a top-tier destination for investors and entrepreneurs. Its business-friendly policies and strategic global location have transformed it into an economic powerhouse. If you are considering setting up a business, understanding the process is the first step toward success. This guide will walk you through the essential steps to register a company in the UAE, focusing on the popular emirates of Dubai, Abu Dhabi, and Sharjah.
Register Company in UAE: Dubai
Dubai consistently attracts a high volume of foreign investment and entrepreneurs. Its vibrant economy, modern infrastructure, and progressive policies make it a prime location. Here is a step-by-step breakdown of the process.
1. Choose Your Business Activity
Your first step is to define the specific activities your business will undertake. The Department of Economy and Tourism (DET), formerly the DED, provides a comprehensive list of thousands of approved business activities. Selecting the correct ones is crucial as it determines the type of license you need.
2. Determine the Legal Structure
Next, you must decide on the legal structure of your company. The two primary options are Mainland and Free Zone. Each offers distinct advantages. A major policy shift now allows 100% foreign ownership for many mainland businesses, a benefit previously exclusive to free zones.
Mainland Companies
Registered with the DET, mainland companies are ideal for businesses targeting customers within the UAE and internationally.
- Office Space: A physical office lease is mandatory. The size of your office dictates the number of visas you can obtain, with a minimum requirement of 200 square feet.
- Ownership: 100% foreign ownership is now available for many business activities.
- Market Access: Unrestricted access to the entire UAE market and the ability to bid on government contracts.
- Capital: No minimum capital investment is required.
- Tax: Subject to a 5% Value Added Tax (VAT) and corporate tax on profits above a certain threshold.
Free Zone Companies
Free Zones are special economic areas with their own regulations, designed to encourage foreign investment. The UAE has over 40 Free Zones, each catering to specific industries.
- Tax Benefits: Generally offer 0% corporate and personal income tax, and exemptions from customs duties.
- Ownership: 100% foreign ownership is standard.
- Repatriation: Allows for full repatriation of profits and capital.
- Office Space: A physical office is not always required; many free zones permit virtual offices.
- Market Restrictions: Business activities are typically limited to within the free zone and outside the UAE. To trade directly in the mainland market, you often need a local distributor.
3. Select and Register a Company Name
Your company name must adhere to the guidelines set by the DET. It should not violate existing trademarks and should accurately reflect your business activities. You must conduct a name availability search through the official DET portal to ensure it is unique.
4. Prepare Legal Documentation
Gathering the correct paperwork is a critical phase. While requirements can vary based on your business activity and structure, the core documents usually include:
- Passport copies of all shareholders and managers.
- A completed application form for company registration.
- Memorandum of Association (MOA) and Articles of Association (AOA).
- A lease agreement for your physical office space (Ejari).
- Approvals from external departments, if required by your business activity.
Once compiled, these documents are submitted to the DET for initial approval.
5. Secure Your Business License
After the DET reviews and approves your documentation, they will issue your trade license. This license officially permits you to commence your specified business activities in Dubai.
6. Post-License Formalities
With your license in hand, you can open a corporate bank account, register for VAT and corporate tax, and process visas for yourself and your employees. It’s often recommended to work with a business setup consultant to ensure all financial and legal obligations are managed smoothly from the start.
REGISTER COMPANY IN UAE: SHARJAH
Known as the industrial hub of the UAE, Sharjah offers a strategic location with access to the Persian Gulf and proximity to Dubai. Its focus on manufacturing and trade makes it an attractive option.
- Determine Company Type: Choose from structures like a Limited Liability Company (LLC), a branch of a foreign company, or a Free Zone company. For 100% foreign ownership, a Free Zone setup is necessary. For an LLC, you will need a local service agent, but profit-sharing ratios are negotiable.
- Select a Company Name: Choose a unique name and verify its availability with the Sharjah Economic Development Department (SEDD).
- Apply for a License: Register your company with the SEDD and apply for the appropriate license: commercial, service, industrial, or e-commerce.
- Gather Documents: Prepare the necessary legal documents, including the MOA, passport copies, a business plan, and a lease agreement.
- Obtain Final Approvals: After receiving your trade license, you may need additional approvals from the Sharjah Municipality.
Selecting a unique business name that resounds with your target audience, and check if it is available with the Sharjah Department of Economic Development (SEDD).
REGISTER YOUR COMPANY AND APPLY FOR RESPECTIVE LICENSE
A new company can be registered in person or online with the Sharjah Department of Economic Development. After this it is time to choose from among 4 of the respective licenses available in Sharjah:
- Ecommerce license
- Service license
- Commercial license
- General trading license
It is imperative to choose the correct license when applying. Failure to do so may lead to heavy penalties and loss of credibility in the marketplace.
MUNICIPALITY APPROVAL
Following the receipt of a trade license, the Sharjah Municipality must grant approval to the prospective new company.
MEMORANDUM OF ASSOCIATION
To be drafted by the applicant, and notified in the relevant notary.
LEGAL DOCUMENTS REQUIRED
- Application form for company registration
- Business card of a designated contact person
- Business plan
- Notarized and attested Memorandum of Association
- Passport copies of owners and managers
- Lease agreement
- Board resolution of foreign parent company (where applicable)
- Feasibility report of potential business
FURTHER INFORMATION
Sharjah requires most businesses to acquire an office space to successfully register company in UAE (Sharjah). This may not be applicable for some trade types like Ecommerce.
It is important to keep a close eye on tax exemptions and requirements, which is why we recommend hiring the services of an expert consultant.
Furthermore, UAE companies law requires all registered businesses to hold an Annual General Meeting (AGM) within four months of the end of every financial year.
COST
The cost register a company in UAE (Sharjah) is determined by various factors such as trade type, office space, visa fees and other expenses. It can cost anywhere between AED 500 to AED 30,000 or more.
Register Company in UAE: Abu Dhabi
As the capital and largest emirate, Abu Dhabi provides a stable and supportive environment for new and expanding businesses. The government actively promotes the emirate as a prime location for investment.
- Choose a Business License Category: Select from six license types: professional, commercial, industrial, tourism, agricultural, or occupational.
- Decide on a Legal Structure: Options are similar to Dubai and include LLC, sole establishment, free zone company, and foreign branch office. 100% foreign ownership is also possible for many mainland activities.
- Register a Trade Name: Your chosen name must be registered with the Abu Dhabi Department of Economic Development (ADDED), which grants a preliminary approval.
- Draft Agreements: Prepare your Memorandum of Association. For mainland companies fully owned by non-GCC nationals, a Local Service Agent (LSA) agreement is required.
- Lease an Office: Secure a physical office space and obtain the attested lease contract.
- Get Your License: Once all steps and any industry-specific approvals are complete, ADDED will issue your final business license.
Final Thoughts
The UAE offers tremendous opportunities for growth, backed by pro-investor policies and world-class infrastructure. The process to register a company in the UAE is streamlined and efficient, especially when compared to other global business hubs. By carefully planning your business activity, legal structure, and location, you can position your new venture for success in one of the world’s most dynamic economies.
