How to start business in Dubai

The UAE is an attractive place to start a business, especially if you’re looking to sell goods in the GCC (Gulf Cooperation Council) region. Dubai provides plenty of commodities, easy access to flights and travel, and lots of talent for hire; so it’s no surprise that starting a business in Dubai is an increasingly popular option for Brits.

This guide will take you through the basics of how to start a business in Dubai, and the right steps for incorporating a company. Plus we’ll introduce Wise Business as a smart solution to handle your business finances.

If you're a business sending more than 100,000 GBP (or equivalent) monthly across different currencies, get in touch with the Wise Business sales team to discuss the best solutions for your needs.

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Doing business in Dubai

Before we get into detail about how to set up a business in Dubai let’s look at some of the features of doing business in Dubai and the UAE which you’ll need to know about.

You can choose to open a business in Dubai either in the Dubai mainland, or in one of the Free Zones. In both cases you can have a 100% foreign owned business - but in the mainland areas, you’ll not be able to have a majority share in your business if it’s in a strategically important field.

Instead you’ll have a local sponsor who must own 51% or more of the company. Local sponsors can be either individuals or local businesses, and typically they don’t have any business responsibilities outside of leading government procedures like visa acquisition and obtaining licences and permits. They must also sign all legal documents and official forms.

Licence options and availability in Dubai vary depending on whether you’re in a Free Zone or not, but can include commercial trade, education, media, ecommerce and consultancy for example¹. Different rules may apply depending on the business type.

If you choose to have a business in a Free Zone you’ll benefit from tax exemptions and support from the Dubai authorities for things like finding office rental and housing. However, depending on your specific entity type and licence, you may be restricted to trading only within the free zone area - which can be a disadvantage.

You can apply online or in person to register your Dubai business, or you can use a business establishment service through an agent². As the Dubai business establishment options available are somewhat different to the UK, you might prefer to use an agent for support and advice - but it’s good to know the process is pretty straightforward if you want to get your Dubai business set up alone.

Set up a business in Dubai

If you intend to open a business in Dubai, you’ll need to understand a few unique features of Dubai and UAE business structure options first, which can include:

• Sole proprietorship
• Partnership company
• Limited liability company (LLC)
• Private shareholding company
• Public shareholding company
• Civil company
• Branch of a foreign company

However, some of these companies can only be set up in the Dubai mainland³ - so not in the Free Zones⁴. As there are some advantages to having a Free Zone entity, you’ll need to consider which works best for you before you get started.

The other thing to consider is whether or not you’ll be able to have full ownership of your company - or if you’ll need to have a local stakeholder who owns 51% or more of your business. Again, here your options can vary depending on whether you’re basing your Dubai business in a Free Zone or not. We’ll work through some key points about your possible Dubai business entity types one by one, next.

Sole proprietorship

You may be able to register as a sole proprietor in the Dubai mainland. In this case, you’ll be personally liable for any financial risk taken, as the finances of your business entity are seen as the same as your individual finances.

Partnership company

Dubai mainland allows partnerships which can be General or Limited Liability. If you have a general partnership you’re personally liable, with your partners, for any financial risk taken as a business. Limited liability partnerships have more personal protections, but can also be more complex to set up and manage.

Limited liability company (LLC)

You can set up an equivalent of an LLC in either Dubai mainland or a Free Zone. Usually you can have 2 to 50 shareholders, and the liability of each shareholder is limited to the amount of their investment in the business.

Private shareholding company

You may be able to set up a private shareholding company in either the Dubai mainland or a Free Zone, although the options may depend on your specific industry and entity. In this case, the company is owned by individuals, or businesses which act as shareholders - the shares are therefore not open to be bought and sold on the free market.

Public shareholding company

As with a Plc in the UK, if you set up a Dubai public shareholding company you’ll be able to trade the shares on the stock market. If this is an option you’re interested in for your Dubai business, you’ll need to take appropriate legal advice to ensure your business is set up correctly.

Civil company

A civil company might be an option if you’re in a recognised professional field - including doctors, lawyers, engineers and so on. Some fields are viewed as strategically important, and so a foreigner can’t own more than 49% of the company - if this is an option you’re looking at it’s worth getting professional support in setting up your Dubai business to ensure you get the optimal structure for your specific needs.

Branch of a foreign company

If you’re planning on working in a Dubai Free Zone you can set up a branch of a foreign company - an option which might appeal if you already have a UK business entity. This business type intends your company in Dubai to remain part of your home business, but trade according to its licence agreement in the UAE.

How to start a business in Dubai - Step-by-step²

The process to start a business in Dubai will depend on whether you’re basing yourself in a Free Zone or not, and the industry you work in. You can either set up your Dubai business alone or work with an agent or intermediary to support this.

To give an example, let’s work through the steps needed to set up a Dubai Free Zone business:

1. Identify the business type and licence, following the UAE licensing system
2. Choose the business entity type you want - in a Free Zone your options are a Free Zone LLC, company or establishment - all of which have their own features, advantages and disadvantages
3. Register your company trade name
4. Select your business space and location - in a Free Zone there are options to build, own or rent an office, warehouse or whatever other building you need
5. Submit your documents and obtain approval for your business - we’ll look at the documents needed in a moment
6. Once you have your initial approvals in place you can then register your business, and get your licence to trade in Dubai

You can apply for approval and then register your business online if you’d like, or you can attend an appointment in person to get set up. If you’re unsure about the process you’ll be able to get support from a company registration agent - this may require you to pay a fee, but it’ll mean the process is smooth and hassle free.

To apply for a licence for a Free Zone company you’ll usually need the following information and documents:

• Completed business licence application form
• Your business plan
• Copy of existing trade licence/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)
• Letter of Intent letter clarifying the investment idea and the investor's plan
• 2 years audited financial reports or certificate of reference from a bank (as required)

Once you have your initial licence you then also need to register your business, with the following:

• Completed registration application form
• 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

Setting up a business in Dubai - FAQs

Let’s move on with some common questions and answers about setting up a company in Dubai.

How much does it cost to start a business in Dubai?

The cost of setting up a business Dubai depends a lot on the company type and scope, and also where exactly you choose to base it. To give some context, the Dubai authorities⁴ state that in a Free Zone a one person company is likely to cost 4,085 USD, while a larger company employing about 4 people who may need visas and office space could cost from around 17,000 USD. In a free zone area, you’ll usually find that your costs, and the number of visas you may apply for, will depend on how big an office or warehouse you choose to rent or buy.

Is it easy to start a business in Dubai?

It should be pretty easy to set up your Dubai company, but the process may not be entirely familiar. The UAE government states you can set up your company in 15 minutes if you do so online - or in 4 days if you prefer to do so in person. The average time to set up a company in a developed company according to the World Bank is 10 days².

Get specific help from the Dubai authorities with a business registration guide, and learn more about investing, living and working in Dubai on the Dubai government website.

Is Dubai startup friendly?

Dubai is pretty startup friendly - but the details will depend on the specific business type you want to start, and where you’d like to base yourself. The business approval and registration process is fast and can be done online, so as long as your business type is allowable in Dubai, you should find it pretty easy to base your startup there.

How to start a business in Dubai as a foreigner?

Foreigners can open a business in Dubai and own 100% of it in a Free Zone. Many Dubai mainland businesses can also be 100% foreign owned, but in some cases - in strategically important industries - you’ll need a local majority stakeholder. The business set up and application process in Dubai is simple and can be done online - or you can use a company formation agent for a fee if you’d prefer.

Manage your international company's finances with Wise Business

If you plan on expanding your UK business in Dubai, you should learn about Wise Business.

Open a flexible, low cost multi-currency Wise Business account to hold and exchange 40+ currencies, with the mid-market exchange rate and low fees from 0.43%⁵ whenever you need to convert between currencies.

Accounts also come with local bank details for a selection of major currencies which you can use to get paid by customers or through PSPs like Stripe and marketplaces like Amazon, plus linked debit and expense cards, multi-user access, batch payment tools and cloud accounting integrations. Here’s how to register a Wise Business account in just a few simple steps:

1. Download the Wise app or head to the Wise desktop site
2. Tap Register and follow the prompts to apply for a business account
3. Add your personal and contact information
4. Upload the documents needed which are detailed online and in this Wise Business bank account requirements guide
5. Pay the one time fee to register your account and get a linked payment card if you need one
6. Once your account is verified you can start transacting - your account will be live in the Wise app, your physical card will be posted to you, and you can get a digital card right away for mobile spending

Get started with Wise Business 🚀

Choosing to set up a business in Dubai can be a great way to boost your company’s international trade. Use this guide on how to open a company in Dubai to start your research - and remember that wherever in the world you choose to base your business, you could be better off with a low cost international account from Wise Business.

Sources used in this article:

Sources last checked Dec 20, 2023