Doing Business in Dubai
Dubai is a country that is very friendly to visitors. It’s great for tourists, as are many walking tours can attest. Doing Business in Dubai is also equally great. Starting up a business in Dubai can be hugely beneficial – you have a prime location in the crossroads of Asia, Europe, and Africa, access to a talented workforce and the charm of working in a country with restricted to no taxation. In this post, we’ll give you an overview of what’s involved in setting up a business in the UAE.
What type of company would you choose for doing business in Dubai?
There are two main types of businesses that foreign investors and entrepreneurs can set up in Dubai – an LLC or a Freezone
For a small business, an LLC (also referred to as a mainland company) is the most common and the easiest choice. With an LLC, yourself will only own 49% of the business. Another 51% will be owned by an Emirati national or a firm that is wholly owned by Emirati nationals. And yes, Emirati partners are really required to show their family book, to prove their heritage.
In an LLC, the foreign investor will have the chance to obtain UAE residence visas for themselves, their family members and a certain number of employees.
There are many business setup consultancies within the UAE, who assist with the paperwork and logistics of setting up a company in the country. These consultancies are often the best way to get connected with an Emirati sponsor. Most of them are likely to already have a list of Emiratis whom they work with. In most cases, you will have to pay the Emirati partner an annual fee in return for their sponsorship. This fee will differ based on the sponsor, so feel free to inquire around to see where you can find the rate that is right for you. Usually, the partner seems not to demand a percentage of your business’s profits, nor is he likely to concern himself in your business decisions. So in exchange for giving this annual sponsorship fee, you get 100% of the profits and a silent partner.
Some of the most popular Free Zones are:
DMCC – Dubai Multi Commodities Centre – This is the UAE’s biggest and fastest-growing Free Zone. It concentrates on the trading of commodities like gold, diamonds, pearls, and tea. Furthermore, it also offers licenses for businesses trading in other goods.
DAFZ – Dubai Airport Free Zone – This Free Zone offers three types of licenses – Trade (imports, exports, storage and distribution of goods), Service and Industry (light industrial activities, packaging and assembling).
DIFC – Dubai International Financial Center – This Free Zone concentrates on banking, financial services, insurance, and wealth and asset management.
DSO – Dubai Silicon Oasis – This Free Zone focuses on companies operating in the tech space, including IT, telecom, engineering, software, biotech and green energy. Consulting companies can also operate here.
D3 – Dubai Design District – This is a popular Free Zone dedicated to the design community, both established brands and start-ups.
Dubai Internet City – This Free Zone is for companies running in the ICT space. Big Companies like Microsoft and Oracle have set up in this Free Zone.
twofour54 – Placed in Abu Dhabi, this Free Zone is aimed at companies operating in the media space. It includes television, print, and public relations companies.
Masdar City – This is another Free Zone located in Abu Dhabi. Its focus is on companies operating in the renewable energy space. Interestingly, the entire city was designed to run on solar power, making it a one of a kind spot.
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