Establishing a company in Dubai for foreigners: procedures and steps

Learn about establishing a company in Dubai for foreigners in terms of procedures and steps because Dubai is considered one of the most prominent global destinations for business and investment, as it provides a dynamic economic environment qualified to attract companies and individuals from different parts of the world. Establishing a company in Dubai is an important strategic step for foreigners wishing to enter a diverse and thriving Emirati market. Dubai is witnessing a significant increase in the number of foreign companies choosing it as the main headquarters for their business, thanks to the incentives and facilities it provides, in addition to its distinguished geographical location as a global commercial center. In this article, we will review the basic procedures and steps for establishing a company in Dubai for foreigners , including legal requirements, choosing the appropriate free zone, and complying with local regulations, with a focus on how to facilitate this process through cooperation with consulting companies such as “Itqan” that provide services. Integrated to support investors in their journey towards success.

Procedures for establishing a company in Dubai for foreigners

Establishing a company in Dubai for foreigners requires following a set of procedures and steps to ensure compliance with local laws and achieve success in the market. Here’s an overview of these procedures:

1. Choosing the type of company : Before starting any procedures, you must determine the type of company you wish to establish, whether it is a limited liability company (LLC), a branch company, a company in a free zone, or any other type.
2. Determine the location : Choose the appropriate location for your company, whether it is in a free zone or in a commercial area within Dubai. Free zones offer many advantages such as full ownership by foreigners and no need for a local partner.
3. Choosing a business activity : Determine the business activity that the company will undertake, as the license varies based on the type of activity.
4. Trade name registration : Choose a trade name for your company, and make sure that it complies with Dubai laws and does not conflict with other company names.
5. Obtaining a license : Submit an application to obtain the appropriate commercial license for your company’s activity, which could be a commercial, industrial, or service license.
6. Preparing legal documents : Prepare and document all necessary legal documents such as the articles of association, bylaws, and approval of company registration.
7. Open a bank account : Open a business bank account in the name of the company, where you will need to deposit the required capital (if any) as part of the incorporation procedures.
8. Company registration with government agencies : Register your company with the relevant government agencies such as the Department of Economic Development or the General Authority for the free zone you have chosen.
9. Obtaining work and residency visas : Once you complete your registration, you can apply for work and residency visas for employees.
10. Business activation : After completing all procedures, activate the business and start the actual operation of your company.

Commitment to these steps ensures that you establish a successful company in Dubai that adheres to all legal requirements and benefits from the distinguished business environment that the city provides.

Steps to establish a company in Dubai for foreigners

Establishing a company in Dubai for foreigners requires following specific steps to ensure that the company complies with local laws and meets all legal requirements. Here are the basic steps to establish a company in Dubai for foreigners:

1. Determine the type of company : Choose the type of company that suits the nature of your business, such as a limited liability company (LLC), a branch company, or a company in a free zone.
2. Choosing a business activity : Determine the business activity that the company will undertake, as the license varies based on the type of activity.
3. Choosing a trade name : Choose a trade name for the company, make sure it complies with Dubai laws and is available for registration.
4. Determine the location : Choose the appropriate location for your company, whether it is in a free zone or in a commercial area within Dubai.
5. Preparing legal documents : Prepare the necessary documents such as the company’s articles of incorporation and bylaws.
6. Company Registration : Submit an application to register the company with the Department of Economic Development or the General Authority of the selected free zone.
7. Obtaining a License : Obtain the required business license based on the type of business activity.
8. Open a bank account : Open a business bank account in the name of the company and deposit the required capital (if there is a minimum capital).
9. Work and Residence Visas : Apply for work and residence visas for employees and company owners.
10. Business activation : After completing all procedures, activate the company and start actual operation.

Be sure to cooperate with a legal advisor or consulting company such as “Itqan” to facilitate this process and ensure compliance with all local laws and regulations.

Establishing a company in Dubai for foreigners requires adherence to specific conditions to ensure compliance with local laws. The main conditions include:

1. Choosing the type of company : Foreigners can establish different types of companies, such as limited liability companies (LLC), companies in free zones, or branches of foreign companies.
2. Identifying the commercial activity : The commercial activity must be accurately identified and an application must be submitted to obtain a commercial license appropriate to the type of activity. Activities vary in licensing and permit requirements.
3. Compliance with local laws : Comply with all local laws and regulations related to trade and business in Dubai.
4. Providing the required capital : Some types of companies, such as limited liability companies, may require a minimum amount of capital that must be deposited in a business bank account in the company’s name.
5. Choosing a trade name : Choose a trade name that complies with local regulations and does not conflict with the names of other companies. The name must be appropriate and not contrary to public morals.
6. Providing an office address : The company needs an office address in Dubai. A location can be chosen in a free zone or a commercial area.
7. Legal documents : Submitting legal documents such as the company’s articles of incorporation and bylaws. You may also need to have documents attested by the relevant authorities.
8. Company Registration : Register the company with the Department of Economic Development in Dubai or the General Authority of the selected free zone.
9. Obtaining a commercial license : Obtaining the appropriate commercial license for the required commercial activity.
10. Work and Residence Visas : Submit applications for work and residence visas for company founders and employees.
11. Opening a commercial bank account : Opening a commercial bank account in the name of the company and depositing the required capital (if there is a minimum capital).
12. Adherence to the conditions of free zones : If you choose to establish your company in a free zone, you must adhere to the specific conditions of each free zone, which may include full foreign ownership and tax exemptions.

Adhering to these conditions helps ensure that you successfully establish a company in Dubai, while taking advantage of the favorable business environment that the city offers.

 

Do foreigners have the right to own the company on their own?

Yes, foreigners can own a company on their own in Dubai, but it depends on the type of company and the location you choose:

1. Free Zones : In most free zones in Dubai , foreigners can own 100% of a company’s shares without the need for a local partner. Free zones provide facilities and privileges for foreigners, such as full ownership and no need for local participation.
2. Limited Liability Companies (LLC) : If you want to establish a Limited Liability Company (LLC) outside the free zones, a local partner who owns 51% of the company’s shares is required, while a foreigner owns 49% of the shares. This requirement is part of the laws that regulate the establishment of companies in the local market.
3. Branches of foreign companies : Foreigners can establish a branch of a foreign company in Dubai, where the branch is wholly owned by the parent company. This form of incorporation does not require a local partner.
4. Civil companies : Foreigners can establish civil companies (such as consulting firms) with local participation, but these companies are subject to the local partner requirement in the same way as limited liability companies.

In short, if you want to fully own your company, establishing it in a free zone is the ideal choice. If you want to establish a company outside the free zones, you will need a local partner who owns a certain percentage of shares.

Cost factors for establishing a company in Dubai for foreigners

The costs of establishing a company in Dubai for foreigners depend on several key factors. Here are the most important factors that affect establishment costs:

1. Company type :
   • Companies in free zones : Costs include licensing fees, office costs, and establishment fees. In free zones, costs can be lower compared to LLCs outside free zones.
   • Limited Liability Companies (LLC) : Costs include licensing fees, office rent, required capital, company registration fees, and local partner costs.
2. Commercial activity : The type of commercial activity affects the cost of licensing, as some activities require special licenses or additional permits, which increases costs.
3. the site :
   • Free zones : Fees vary depending on the free zone you choose. Some areas offer comprehensive packages that include a license and an office.
   • Commercial areas : Costs may be higher and include office rent, registration fees, and additional requirements.
4. Office cost : includes rent, furnishing costs, and other services such as internet and telephone. Prices can vary greatly depending on location and office space.
5. License fees : depend on the type of license (commercial, industrial, service) as well as the company’s activity. In free zones, fees can be lower because some areas include a license within the establishment package.
6. Legal and administrative fees : These include the costs of preparing and documenting legal documents such as the articles of association and bylaws, as well as legal consulting fees if you use the services of consultants.
7. Capital costs : Some types of corporations, such as limited liability companies, require a minimum amount of capital that must be deposited in a business bank account.
8. Work and Residence Visas: Includes fees for work and residence visas for company founders and employees. Costs depend on the number and type of visas.
9. Taxes and Government Fees : Includes annual registration fees, government fees, and any other taxes that may be required.

In short, the costs of establishing a company in Dubai depend on several variable factors, and all of these factors must be taken into account when estimating the required budget.

Establishing a company in Dubai for foreigners represents a unique strategic opportunity for entrepreneurs and investors looking for a suitable business environment and sustainable growth. Thanks to the great facilities the city offers, such as full foreign ownership in free zones, tax exemptions, and modern infrastructure, Dubai is an ideal destination for expansion and innovation. By understanding the procedures and conditions followed, foreigners can fully benefit from the advantages of investing in Dubai, which enhances the chances of success of their projects in the global market. Cooperation with specialized consulting companies such as “Itqan” can greatly contribute to accelerating the establishment process and ensuring its compliance with all local laws and regulations. Ultimately, Dubai offers a strong platform for starting a business and achieving growth, making it an attractive option for anyone seeking to invest in an outstanding business environment.

 

Frequently asked questions about establishing a company in Dubai for foreigners

Can foreigners own a company entirely in Dubai?

Yes, foreigners can own 100% of shares in companies established in Dubai free zones. As for limited liability companies (LLC) outside the free zones, a local partner who owns 51% of the shares is required.

What types of companies can foreigners establish in Dubai?

Foreigners can establish companies in free zones, limited liability companies (LLC), branches of foreign companies, and civil companies. Each type has its own advantages and requirements.

What are the basic procedures for establishing a company in Dubai?

The basic procedures include determining the type of company, choosing the business activity, registering the trade name, submitting legal documents, obtaining a business license, opening a bank account, and submitting applications for work and residence visas.

What are the costs associated with setting up a company in Dubai?

Costs include license fees, office rent, registration fees, capital costs (if there are capital requirements), legal documentation costs, and work and residence visa fees.

Are there corporate taxes in Dubai?

In free zones, companies usually benefit from tax breaks such as exemption from income and capital gains tax. Outside the free zones, companies may be subject to taxes based on the type of activity and local government requirements.