8 Steps For Company Formation In Dubai Mainland
Posted by Bruce Wyane on June 7th, 2019
Start Your Business in Dubai
Dubai offers a lot of opportunities and in an effort to attract more investments the Dubai Economic Development (DED) aims to work on its vision to help business owners set up their company and expand their operations with quick and easy processes and administration.
You can set up a company in Dubai either in the Dubai mainland or more than 30 economic free zones across the UAE. These two offer different benefits depending on your business type and activities.
For company formation in Dubai Mainland, you need a Dubai business license to be issued after you register in DED.
STEP 1: DETERMINE YOUR BUSINESS ACTIVITY TYPE
There are more than 2,000 business activities available in the Dubai DED. They fall into different classes and groups: industrial, commercial, professional and tourism activities. Download a comprehensive list of Dubai DED activities here.
The license type is associated to the activity type of the business. If the activity type is professional, then the license should be professional as well. If the license combines many activities, the largest activity (industrial) will be priority followed by commercial and professional activities. This does not apply for tourism activities.Some business activities may require approvals from other government authorities other than Dubai DED.
STEP 2: SELECT A LEGAL FORM FOR YOUR BUSINESS
A legal form is a description of what your business is all about.When you choose a legal form for your business, you must take in consideration the business activities, business type, the number and the nationality of shareholders and the shareholding options.
Companies in Dubai can take several legal forms but not all legal options may be open to you.Some of the common legal structures used for company formation in Dubai include Sole Proprietorships, Limited Liability Companies, Civil Companies, and branches of foreign or UAE-based companies.
STEP 3: SELECT TRADE NAME
DED Trade Name Guidelines
The name should not contain obscenities or words that convey obscenity. Also, the trade name should not be offensive to the general public. This also holds good for a personal name.The name should not include Allah's name, or "God", or His divine attributes, for example (al wader, al alee).Only a partner’s name can be included in the license. For instance, a license issued to John Doe cannot include the name of John Simpson.Family names cannot be used as a trade name unless the trade name includes the first name. For instance, Mohamed Al Shams cannot have a trade name ‘Al Shams Trading’. This would have to be changed to ‘Mohamed Al Shams Trading’.Names should be written literally. Translations are not allowed.
The trade name cannot include the name of any country or government entity.The business name must reflect business activity. For instance, ‘Carac Café LLC’, or ‘Pioneer Gate Business Centre’.The name cannot include names of political organizations, religious organizations, or any other such globally restricted names.The name should not include any punctuation marks.
If the name contains special features, you will have to pay an additional fee between AED 1,000 and AED 2,000.
Trade name that contains foreign words which cannot be translated into Arabic, for instance, "Silver" – Fee: AED 1,000.
Trade Name that include regional references, for example "East", "West", "International", "American", "European" – Fee: AED 1,000.
If part of the trade name is a trademark – Fee: AED 1,000.
Trade name including numerical digits, for example "Pioneer 2,000 Trading". This does not include names where the numbers are written as letters, for example "Pioneer One" – Fee: AED 2,000.
Trade name including foreign (non-Arabic) words – Fee: AED 2,000.
Trade name including the word "Gulf" – Fee: AED 2,000.
Trade name including an abbreviation, for example P.G.B.C Trading – Fee: AED 2,000.
STEP 4: PREPARE APPLICATION
The partners/shareholders may need to sign a Memorandum of Association (MOA), depending on the legal form of your company. In some cases, for example in branch companies/professional licenses, a Local Service Agent agreement will have to be signed. Both agreements are signed in front of a Public Notary in the Dubai Courts.Download your guide on legal agreement requirements for all types of legal structures in Dubai.You will need to draft a Memorandum of Association if the legal structure of your company is one of the following:
STEP 5: ESTABLISH THE LOCATION OF THE BUSINESS
All companies registered in Dubai must have a physical address. You can sign a tenancy contract and register the same with Ejari for attestation. This attested contract is then submitted to the DED in order to issue the license.The physical space rented depends on the activity of the company and the number of visas required. You can register a company in Dubai on a desk space as well. However, in case you require multiple visas, you would need bigger spaces. The number of visas allowed depends on the office space taken, which is usually calculated at 80 square feet per visa. In some cases, the DED is flexible on this allocation, for example in instances where the Dubai branch company has a large outdoor sales force, or cleaning services.
STEP 6: OBTAIN A LICENSING APPROVALS
In some cases, special approvals may be required from federal or local government authorities. For instance, branch companies need to register with the Ministry of Economy, and legal activities require clearances from the Legal Affairs Department. Enquire now to check if your activity needs special approvals.
STEP 7: COLLECT YOUR BUSINESS LICENSE
This is the last stage in the process. All the required documents are collected and submitted. The DED then issues a payment voucher, that details the fees involved. Once paid, the trade license is issued and you are ready to do business in Dubai!
STEP 8: POST SETUP FORMALITIES
Your license is the starting point, however, there are some steps that you need to complete in order to be a fully functional business. Click on the links to know more, or to contact us to help you with our services.
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About the AuthorBruce Wyane
Joined: June 4th, 2019
Articles Posted: 7
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