A Comprehensive Guide to Company Formation in UAE: Mainland and Free Zones
Introduction:
Welcome to SK Financial Services, your trusted partner in navigating the intricate landscape of company formation in the United Arab Emirates (UAE). Whether you are considering establishing your business in the mainland or exploring the benefits of free zones, we are here to guide you through every step of the process.
Company Formation in UAE
The process of Company Formation in UAE, involves only a few simple steps, in all seven emirates. You can apply by yourself at the Economic Development Department of any Emirates where you want to plan and set up your business. Additionally, digital platforms are available for obtaining trade licenses and setting up companies online where applying with necessary documents will result in a license within minutes. Investors can also apply through legal offices or designated companies offering business entity services. Setting up a company usually involves identifying a location, specifying the nature of the business and paying the prescribed fees for the issuance of a trade license.
Steps to Establish Your Company with inside the UAE Mainland
01. Identify Nature of Business Activity
The UAE offers 6 types of basic economic licenses for company formationRead More
- Occupational
- Tourism
- Industrial
- Commercial
- Agricultural
- Professional
There are over 2,000 economic activities performing in the UAE. Economic license includes several economic activities. The nature of business activity determines, which type of license you required.
02. Determine Your Company’s Legal Structure
A business structure is primarily based on the needs of the business and will determine the rules and regulations that the company must follow. Read More
Legal Forms of Businesses in the UAE
- Sole Establishment
- Branch Of A GCC Company
- Civil Company
- Branch Of A Local Company
- Limited Liability Company
- Holding Company
- Public Joint Stock Company
- Representative Office Of A Foreign Company
- Private Joint Stock Company
03. Register the Trade Name
Trade name refers as the name of your company. It must be unique and not match any other registered company. You can apply to obtain the trade name via Economic Development department’s website.Read More
Terms and Conditions:
- The trade name must have the abbreviation of the company’s legal structure as a suffix (e.g LLC).
- The trade name should not contain inappropriate words and should not be offensive to the general public.
- The trade name must be compatible with economic activities
- The trade name must not contain the names of rulers, government agencies, or the names and logos of external government bodies
- The trade name is unique and not registered by any other company
- The trademark and trade name must be approved by the Economic Development Department and the Ministry of Economy, respectively
- Trade name certificates are subject to renewal
04. Apply for Initial Approval
An initial approval is the UAE Government’s ‘no objection’ towards a particular business being established in the country. Read More
The approval allows the investor to proceed further. The next step is to set up a business and the authorities to issue the license. It does not, however, grant the investor permission to run the business or practice the business activity.
05. Create MOA or LSA
Memorandum of Association (MOA) is required. If the legal form of the company is a limited liability company, public shareholding company, private shareholding company, or civil company. If it is a sole proprietorship then local service agent agreement (LSA) is required
06. Choose Your Business Location
All businesses working in UAE must have a physical address to operate. The company’s premises and location must comply with the zoning policies and regulations of the Emirates Economic Development Department as well as local municipalities or other competent authorities. In Dubai, a tenancy agreement for office or warehouse space must be registered through the Dubai Land Department’s tenancy portal.
07. Apply for Additional Government Approvals
Sometime, additional approvals are required from government agencies that regulate certain business activities.Read More
Learn More About Economic Activities That Require Approval.
- Ministry of Interior: General transport, car rental, driving schools, used-car dealers, used auto-parts, fire equipment, alarm and safety systems.
- Ministry of justice: Legal activities and legal consultancy
- Local Municipal department: Architectural and engineering affairs
- Telecommunications and Digital Government Regulatory Authority (TDRA): Telecommunication activities
- Executive Council: General services, ship and maritime agencies, charter trading, charter air transport, foreign company branches, car clubs, and travel and tourism
- Ministry of Economy: Insurance activities and insurance consultancy
- Local health departments: Health-related activities
- Supreme Petroleum Council: Offshore and onshore oil drilling operations and offshore and onshore gas and oil-field services
08. Submit Required Documents
- Initial approval receipt and copies of total previously submitted documents
- Copy of lease contract, duly attested
- Memorandum/s of Association, as required
- Approvals from other government entities, as required
09. Pay Fees and Collect License
Customers can collect business licenses from service centers of the economic department or from their website.
10. Register Your Company with the Chamber of Commerce and Industry
Registration of the company must be in the same emirate where it has been incorporated.Read More
- Federation of UAE Chambers of Commerce & Industry
- Abu Dhabi Chamber of Commerce and Industry
- Dubai Chamber of Commerce and Industry
- Sharjah Chamber of Commerce and Industry
- Ajman Chamber of Commerce and Industry
- RAK Chamber of Commerce & Industry
- UAQ Chamber of Commerce and Industry
- Fujairah Chamber of Commerce and Industry
Steps to Establish Your Company inside the UAE Free Zones
01. Determine Nature of Business Activity
In free zones, UAE offers various types of business licenses to entrepreneurs and investors based on the nature of business. Some of them are:Read More
- Commercial Trade
- Consultancy Services
- Industrial
- Educational
- Media
- E Commerce
- Offshore
- Freelancer
- Warehousing
- Manufacturing
- Innovation
- Others
02. Determine Your Company’s Legal Structure
The legal structure of a company depends on the nature and requirements of the business. It defines the regulations and laws that companies must follow. Read More
There are 3 types of legal forms of businesses in the UAE free zone
- Free Zone Limited Liability Company (FZ LLC)
- Free Zone Company (FZ Co.)
- Free Zone Establishment (FZE)
03. Register The Trade Name
Trade name means the name of your company. It must be unique and not similar to any other registered company. You can obtain the trade name from the respective Economic Development Department’s website or smart application.Read More
Terms and Conditions
- Trade name must have the abbreviations of the company’s legal structure as a suffix (e.g. LLC)
- Trade name should not contain any inappropriate words and should not offensive to general public.
- Trade name must be similar or compatible with your economic activities
- Trade name must not contain any government agencies, names of rulers, or names and logos of external government bodies
- Trade name must not be unique and not registered by any other company
- Trademark and trade name must approved by the Economic Development Departments and the Ministry of Economy, respectively
- Trade name certificates are subject to renewal
04. Select Business Space and Location
There are more than 40 free zones in the UAE. To set up a new business, select the place which matches the nature of business activity.Read More
Choose a business space for your company
- Free zones in the UAE give you several options to own or rent an office, or buy land to set up your factory or office building. If you want to obtain an independent/professional license, you can rent an office or register with a virtual office. The office space will depend on the business activity and the number of employees of your company.
- Office spaces in free zones come either fully equipped or partially furnished, and can be rented or purchased after a commercial license is issued.
- In most cases, it is the free zone authority that issues rental contracts.
Access to public utilities, communications and the internet
The facilities and services offered vary from one free zone to another. In general, infrastructure at all zones is well developed, with IT support services including telephone and high-speed internet connections.
Services for establishing companies and equipping facilities
Free zone authorities provide various facilities and support services to help entrepreneurs and investors to establish their businesses. Some are:
- Inquiring, reserving and applying for trade names
- Getting NOC letters or ‘To whom it may concern’ letters
- Issuing, renewing and cancelling residence visas
- Investing and funding opportunities
- Legal advice
- Furnished/semi-furnished offices
- Warehouse
- Telecommunications
- State-of-the-art IT infrastructure
- Secretarial services
- Photocopy and printing services
- Meeting rooms with AV facilities
- Labor accommodation
- Assistance with recruitment
- Employee and family housing
05. Obtaining the Initial Approval
You must complete all requirements and submit necessary documents to obtain the initial approval to open a new company. Some other activities like health, travel and tourism will require some additional government approvals that must obtain from relevant authorities.Read More
Documents Commonly Required for Companies
- Completed application form
- Business plan
- Copy of existing trade license/registration certificate (if applicable)
- Passport copies of the company’s shareholders and appointed manager
- Registry Identification Code Form (RIC) for appointed manager (original and notarized)
- Specimen signatures of the company’s shareholders and appointed manager
- Title deeds (if applicable)
- A brief letter clarifying the investment idea and the investor’s plan (Letter of Intent)
- 2 years audited financial reports or certificate of reference from a bank (as required)
Documents Commonly Required for Freelancers / Professionals
- Application for registration
- Curriculum vitae or profile
- Reference letter from a bank
- Registry Identification Form (RIC) for Director (original and notarized document)
06. Registration and Payment of Fees
- Pay fees and secure company license
- Fees include company license issuance fee, which depends on the type of license.
Documents Most Commonly Required
- Completed application form for registration
- Board Resolution appointing Manager/Director (notarised and attested)
- Power of Attorney given to Manager/Director (notarised and attested)
- Memorandum and Articles of Association (notarised and attested)
- Specimen signature of Manager/Director (notarised and attested)
- Passport-size photos of Manager/Director
- Share capital information
How To Apply for Company Formation in UAE
The Electronic Basher Platform
Basher - A unified platform that allows to set up company in 15 minutes. Local and federal government agencies related to licensing of economic activities in various emirates have been brought together in a unified platform to facilitate doing your business.
Through Economic Development Departments in the Emirates:
You can apply to establish company by visiting one of the following offices:
- Government service centers
- Tasheel offices
- On Time offices for government services
- Legal services offices
- Customer happiness centers affiliated to the departments of economic development in all emirates of the country
Time Taken to Establish Company in the UAE and Worldwide
10 Days
In high-income countries, according to the World Bank
4 Days
In the UAE through Economic Development Department
15 Minutes
Via the Basher online platform
Frequently Asked Questions (FAQs):
Q1: What are the advantages of company formation in a free zone?
Q2: How long does it take to establish a company in the UAE mainland?
Q3: Can I change my business location after the initial setup?
Conclusion:
Choosing between mainland and free zone company formation in the UAE depends on your business objectives and preferences. SK Financial Services is here to simplify this process, ensuring a seamless experience from inception to establishment.
Need more information and personalized assistance, Contact us today.
Feel Free to Contact Us
Mobile: +971 54 3304320
Email: Syed.faisal@sk.financial
Whatsapp: +971 54 3304320
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