A Few points to remember when setting up a Business in Mainland Dubai

Dubai has the reputation of being one of the most dynamic and transformative cities in the Middle East. Promising an extraordinary quality of life, ultra-modern amenities and incredible opportunities, the city attracts professionals, skilled workers and entrepreneurs from across the globe. Dubai is also one of the most sought-after business destinations in the world, thanks to the world-class infrastructure and easy business set up it delivers. Companies that would like to establish a presence in Dubai can choose a location either in one of the free zones or in mainland Dubai.

While the many free zones that the city hosts offer a range of attractive benefits like 100% repatriation of profits and 0% personal and business taxes, only a business in mainland Dubai is permitted to trade directly with local UAE markets and bid for government contracts. Below we explore the steps for registering a company in mainland Dubai, plus a few things to keep in mind before you submit your license application.

  • Decide on your business activity
    This is the first step – being clear on the exact nature of your business. The best thing about setting up your company in mainland Dubai instead of one of the free zones is that there are very little restrictions on the type of business that you can set up. Dubai’s Department of Economic Development (DED) has a list of 2,000+ permitted business activities, across industry verticals. A business in mainland Dubai can choose any one of these.
  • Draw up a business plan
    Once you’re clear on the activity, the next step is to come up with a clear plan on how you’re going to conduct your business. Your business plan will often be the difference between failure and success in your endeavour. Coming up with a viable and inclusive business plan will involve detailed research into the market, competitors and suppliers. You also have to consider the resources and investment that you will need to put in, and decide on the critical KPIs and margins that will determine if your efforts have yielded successful returns.
  • Find a suitable location
    Once you’re clear on what you’re going to do and how you’re going to do it, the next step is “where”. Another advantage of choosing mainland Dubai over one of the free zones is that you are not restricted to certain areas, and you can set up your business anywhere in the emirate. But remember that your location should be a carefully thought out decision that factors in your business activity, the facilities required, leasing costs, transportation costs etc. For example, if your business activity involves a lot of international trade, ensure that you find a location with warehousing facilities and close to one of the seaports or airports.
  • Partner up with a local sponsor
    Companies in mainland Dubai require association with a UAE national or a UAE company by law. They will take on the role of your local sponsor and will legally own 51% of the company. But the profits, of course, can be shared as you arrange. When selecting local sponsors or service agents, you will need to consider your business activity and what you need from your sponsor. A low-cost sponsor will only be a partner for legal formalities. But a higher end sponsor will be more involved in your operations and support you through government approvals and documentation with their expertise and connections.
  • Fill out and submit your application
    The final step is applying for your business license. But before you do, make sure that you have all your paperwork in order. This would include the approvals, clearances and permits from relevant bodies. Make sure you have finalized your business’s name, legal structure, shareholder details, office space, warehousing space, and visa requirements. Ensure that you fill all this information correctly within the required sections in your license application. Finally, attach all necessary documents like the memorandum of association, the certificate of incorporation etc. with your application.

While it’s true that the process for company set up  in Dubai might seem a bit more complicated than setting up one in the free zones, the resulting advantages definitely outweigh the efforts involved. Further, you can always seek the help of a registered company formation agent to support and guide you through the process.

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