What are the Legal Requirements for Setting up a Business in Dubai?
When setting up a business in Dubai, there are several legal requirements that need to be fulfilled. Here are some of the key considerations:
Determine the Business Type: Decide on the legal structure of your business, such as a sole proprietorship, partnership, limited liability company (LLC), or branch of a foreign company.
Choose a Business Name: Select a unique name for your business that complies with the naming conventions set by the Department of Economic Development (DED) in Dubai.
Obtain Initial Approval: Submit the necessary documents and obtain initial approval from the DED or relevant free zone authority, depending on the location of your business.
Choose a Business Location: Identify a suitable location for your business, taking into account factors such as accessibility, target market, and business activity restrictions.
Secure a Local Sponsor: If you opt for a mainland company, you will need a local sponsor or service agent who holds 51% ownership of the business. The local sponsor may not have control over the day-to-day operations but will be entitled to a share of profits or an agreed-upon fee.
Draft Memorandum of Association (MOA): Prepare the MOA, which outlines the business activities, partners’ roles, capital distribution, and other relevant details for LLCs.
Capital Requirements: Depending on the business type and location, there may be minimum capital requirements. It is essential to meet these requirements and open a corporate bank account to deposit the capital.
Obtain Business License: Apply for the appropriate business license from the relevant authorities. The requirements and procedures vary based on the business activity and location.
Register with Relevant Authorities: Register with the DED or the applicable free zone authority, depending on the business location. This includes obtaining a trade license, registering for taxes, and obtaining any necessary permits or approvals.
Lease Agreement: Secure a lease agreement for your business premises, ensuring it complies with the regulations and requirements set by the relevant authority.
Employee Visas: If you plan to hire employees, you will need to apply for their work visas and residence permits through the Ministry of Human Resources and Emiratisation or the relevant free zone authority.
It is important to note that the specific requirements and procedures can vary based on the business activity, location (mainland or free zone), and the authority overseeing the registration process. Consulting with business setup consultants, such as JBConsultants, can provide you with tailored guidance and support throughout the setup process.
