Dubai stands as a beacon for global entrepreneurs, offering a dynamic business environment fueled by its strategic location, robust infrastructure, and favorable tax policies. Whether you’re launching a startup or expanding an established enterprise, registering a company in Dubai opens doors to a thriving market. This comprehensive guide outlines the steps to legally register your new company, focusing on mainland and free zone setups, with insights into recent regulatory changes that enhance foreign ownership opportunities.
Understanding Company Types in Dubai
Before embarking on the registration process, it’s crucial to select the company type that aligns with your business objectives. Dubai offers three primary setups: mainland, free zone, and offshore companies.
Mainland Companies
Mainland companies are registered with the Dubai Department of Economic Development (DED) and can operate anywhere in the UAE, including the local market and internationally. Since June 2021, amendments to the UAE Commercial Companies Law allow 100% foreign ownership for over 1,000 commercial and industrial activities, eliminating the need for a local Emirati sponsor in many cases (UAE Government Portal). However, certain strategic sectors still require local partnership.
Free Zone Companies
Free zones are designated areas offering incentives like 100% foreign ownership, tax exemptions, and simplified import/export procedures. Each free zone caters to specific industries, such as technology or logistics. Companies registered here can operate within the free zone and internationally but need a distributor to access the UAE’s local market. Dubai hosts over 20 free zones, including the Dubai Multi Commodities Centre (DMCC) and Jebel Ali Free Zone (UAE Free Zones).
Offshore Companies
Offshore companies are designed for international business and asset protection, not for operating within the UAE. They are less common for new businesses aiming to establish a local presence and are thus briefly mentioned here.
For most entrepreneurs, mainland or free zone setups are the go-to options. This guide details the registration processes for both.
Registering a Mainland Company in Dubai
Registering a mainland company involves several steps, overseen by the DED. Below is a detailed breakdown.
Step 1: Identify Your Business Activity
Start by defining your business activity from over 2,000 options categorized under commercial (e.g., trading), industrial (e.g., manufacturing), or professional (e.g., consultancy) licenses. This choice determines your license type and any additional approvals required from relevant authorities (Ministry of Economy).
Step 2: Select the Business Structure
Choose a legal structure, such as a Limited Liability Company (LLC), sole proprietorship, or branch office. LLCs are popular for their flexibility and local market access, while sole proprietorships suit individual professionals. The structure impacts liability and ownership rights.
Step 3: Choose a Trade Name
Select a unique trade name that complies with UAE regulations. It must reflect the business activity, avoid offensive terms, and exclude government or religious references. Verify availability and reserve the name through the DED’s online portal or in-person services.
Step 4: Obtain Initial Approval
Submit an application to the DED for initial approval, including details about the business activity, shareholders, and managers. Required documents typically include passport copies and a completed application form. This step confirms your eligibility to proceed.
Step 5: Draft the Memorandum of Association (MOA)
For multi-shareholder entities like LLCs, draft and notarize the MOA, outlining the company’s structure, shareholder roles, and business scope. Legal assistance may be beneficial to ensure compliance.
Step 6: Secure a Business Location
Lease a physical office space that meets DED regulations. The tenancy contract must be registered with Ejari, Dubai’s tenancy contract registration system, to validate the address (Dubai Land Department).
Step 7: Submit Documents and Pay Fees
Compile and submit all documents, including the initial approval receipt, MOA, lease agreement, and passport copies, to the DED. Pay the licensing fees, which vary based on the business activity and structure.
Step 8: Receive Your Business License
Upon approval, the DED issues your business license, authorizing legal operations in Dubai. Licenses can be collected from DED service centers or accessed online.
Step 9: Open a Corporate Bank Account
With your license, open a corporate bank account with a reputable UAE bank. Provide the trade license, MOA, and shareholder passports to complete the process.
Step 10: Register for VAT (if Applicable)
If your annual turnover exceeds the VAT threshold (currently AED 375,000 for mandatory registration), register with the Federal Tax Authority to comply with UAE tax laws.
Step 11: Obtain Visas and Labor Cards
For hiring employees or securing residency, apply for visas and labor cards through the Ministry of Human Resources and Emiratisation and the General Directorate of Residency and Foreigners Affairs.
Required Documents for Mainland Registration
| Document | Description |
|---|---|
| Passport Copies | For shareholders and managers |
| Initial Approval Receipt | From DED |
| MOA | Notarized for LLCs |
| Lease Agreement | Attested via Ejari |
| Application Form | Completed with business details |
| Business Plan | If required by DED |
| Trade Name Certificate | Proof of name reservation |
Costs and Timeframes
Mainland registration costs typically range from AED 20,000 to AED 40,000, depending on the business activity and office size. The process can take 4–10 days, with online platforms like Bashr reducing it to as little as 15 minutes for straightforward cases (UAE Government Portal).
Registering a Free Zone Company in Dubai
Free zone registration is generally simpler, with fewer steps and minimal paperwork, managed by the respective free zone authority.
Step 1: Choose the Appropriate Free Zone
Select a free zone aligned with your business activity, such as DMCC for commodities or Dubai Silicon Oasis for technology. Each free zone has unique regulations and benefits, so research thoroughly (UAE Free Zones).
Step 2: Determine the Legal Entity
Choose between a Free Zone Limited Liability Company (FZ LLC) or Free Zone Company (FZ Co.), based on the number of shareholders and whether they are individuals or corporate entities. Not all free zones offer both options.
Step 3: Choose a Trade Name
Select a trade name adhering to the free zone’s naming rules, ensuring it’s unique and appropriate.
Step 4: Apply for a Business License
Apply for a license (commercial, industrial, or service) through the free zone authority, specifying your business activity.
Step 5: Choose an Office Space
Select from flexi-desks, executive offices, or warehouses offered by the free zone, tailored to your operational needs.
Step 6: Submit Documents and Get Approvals
Submit documents like passport copies, business plans, and application forms. The free zone authority reviews and grants approvals.
Step 7: Receive Your Business License
Upon approval, receive your license, enabling operations within the free zone and internationally.
Step 8: Open a Corporate Bank Account
Open a bank account using your license and supporting documents.
Required Documents for Free Zone Registration
| Document | Description |
|---|---|
| Passport Copies | For shareholders and directors |
| Business Plan | Outlining business objectives |
| Application Form | Specific to the free zone |
| Existing License | For branches of existing companies |
| Proof of Address | For shareholders, if required |
Costs and Timeframes
Free zone setup costs range from AED 10,000 to AED 50,000, varying by free zone and business type. Registration can be completed in a few days, with some free zones offering same-day licensing.
Recent Regulatory Changes
Since June 2021, the UAE’s Commercial Companies Law allows 100% foreign ownership for many mainland activities, covering over 1,000 commercial and industrial sectors. However, strategic sectors like oil and gas may still require local sponsorship. Check the DED’s list of eligible activities to confirm (Invest in Dubai).
