Establishing a company in Dubai is a strategic step for foreigners looking to enter the dynamic business market in the UAE. Dubai has an attractive business environment, offering many investment opportunities and legal facilities, making it a preferred destination for international investors. However, setting up a company in Dubai requires following specific procedures and steps to ensure compliance with local laws. In this article, we will review the basic procedures and steps required to establish a company in Dubai for foreigners , including choosing the type of legal entity, requirements for obtaining a trade license, registering with the relevant authorities, in addition to the importance of hiring legal advisors to ensure the process runs smoothly. We will also discuss the benefits that Dubai offers to foreign investors, which enhances the chances of their business success in this global city.

Procedures for establishing a company in Dubai for foreigners

Establishing a company in Dubai for foreigners requires following a set of legal procedures and steps. Here are the details of these procedures:

1. Determine the type of business: You must determine the business activity you wish to practice, as each activity requires a different license. Check the list of available activities to ensure that they comply with the required license.
2. Choosing a business name: Choose a business name that complies with local laws. The name must be unique and not similar to other company names.
3. Applying for a commercial license: Applying for a commercial license from the Department of Economic Development
4. (DED) in Dubai. Required documents include: License application Copy of owner’s passport Company’s articles of association Partnership agreement (if required)
5. Company Registration: Register with relevant government entities, such as the Dubai Chamber of Commerce and Industry. You will need to submit documents related to the establishment of the company, such as the articles of association and bylaws.
6. Opening a bank account: After obtaining the license, a bank account must be opened in the company’s name to manage financial operations.
7. Obtaining Work Visas: After registering the company, you can apply for work visas for you and the necessary workers.
8. Submitting the necessary permits: Depending on the business activity, you may need additional permits from different authorities such as the Ministry of Health, or the Ministry of Environment.
9. Office Setup: It is essential to have an administrative headquarters to conduct your business. You can choose a virtual office or a co-working space, depending on your needs.
10. Tax Registration: You must register for taxes, including VAT (if applicable).
    By following these steps, you can establish a successful business in Dubai and take advantage of the economic opportunities available in this global city. It is also advisable to consult a legal advisor or a company specializing in company formation services to ensure full compliance with all local laws and regulations.

Conditions for establishing a company in Dubai for foreigners

Establishing a company in Dubai for foreigners requires compliance with several legal and administrative conditions. Here are the most important conditions that must be taken into account:

• The type of legal entity (LLC, sole proprietorship, branch of a foreign company, etc.) must be determined based on the nature of the business and shareholders.
• In the case of establishing a limited liability company (LLC), there must be a local partner who owns 51% of the company’s shares. The local partner can be an individual or a corporation.
• You must determine the business activity you wish to practice, as requirements and licenses vary depending on the type of activity. It is preferable to review the list of approved business activities from the Department of Economic Development (DED).
• The company name must be unique and comply with local laws. There are restrictions on some names, such as names that include religious terms or are contrary to public morals.
• The company must be registered with the Department of Economic Development (DED) and obtain a trade license. The process involves filling out the required forms and paying fees.
• In some cases, a financial guarantee or deposit of a certain amount may be required as a condition for establishing the company, especially if the activity requires it.
• Owners and employees are required to obtain work visas, which requires additional documentation and applications to the Department of Naturalization and Residency.
• All local laws relating to business activity must be complied with, including labor and tax laws.
  The law requires that the business have an administrative office. This office can be a physical office or a co-working space.
• These requirements are a basic framework for establishing a company in Dubai. It is advisable to consult a legal advisor or a specialized firm to help you meet all the legal and administrative requirements and ensure that the process runs smoothly.

Documents required to establish a company in Dubai for foreigners

To establish a company in Dubai for foreigners, there are a set of papers and documents required. Here is a list of the basic papers you need:

1. Passport Copy: A valid copy of the owner or partners’ passport must be provided.
2. Personal Photographs: Recent personal photographs of the owner or partners.
3. Articles of Association: Includes details about the partners, percentage of ownership, and the company’s activity. This contract must be certified by the relevant authorities.
4. Partnership Agreement (if required): In case of partners, a partnership agreement is prepared that outlines the terms and conditions of cooperation between the partners.
5. Trade License Application: Fill out the Trade License Application Form provided by the Department of Economic Development (DED).
6. No Objection Certificate: If the owner is already operating in the UAE, you may need to provide a No Objection Certificate from your current employer.
7. Business Plan: Some activities require a detailed business plan outlining how the company will operate and its objectives.
8. Business Activity Definition: A list of the business activities to be undertaken, which must be in line with the approved activities in Dubai.
9. Company Headquarter Documents: Proof of office location must be provided, whether it is a lease contract or a document showing ownership of the place.
10. Signing the incorporation form: Signature of the owners on the incorporation form or the company’s contract.
11. Local partner certificate (if required): In the case of establishing a limited liability company, a certificate from the local partner must be submitted.
12. Proof of payment of fees: Provide proof of payment of the fees required to establish the company.
13. Submission of required permits: If the business requires additional permits, such as health or environmental permits, the relevant documents must be submitted.

Can foreigners obtain ownership in establishing their company in Dubai?

Yes, foreigners can have full ownership of their companies in Dubai, according to several options available. Here are the details:

Free Zones

Foreigners can set up their companies in Dubai’s free zones (such as Jebel Ali Free Zone, Dubai Airport Free Zone, etc.) where they can have 100% ownership of the company without the need for a local partner. These zones offer tax benefits, tax exemptions, and freedom to repatriate profits.

Limited Liability Companies (LLC)

For the establishment of a Limited Liability Company (LLC), UAE law requires a local partner to own 51% of the company’s shares. However, foreigners can agree with the local partner on terms that give them full control over operations and management.

Branches or representative offices

Foreign companies can open branches or representative offices in Dubai, allowing them to conduct business without the need for a local partner. However, the branch must be under the sponsorship of the parent company.
In addition to sole proprietorships, foreigners can establish a sole proprietorship in Dubai, where the owner is solely responsible for managing the business.

Investing in joint ventures

Foreigners can also enter into joint ventures with local investors, allowing them to benefit from local knowledge while retaining a significant percentage of ownership.
Therefore, foreigners have several options that allow them to obtain full or partial ownership depending on the type of company and the field they wish to invest in. It is preferable to consult a legal advisor or a company specialized in establishing companies such as Itqan Company to obtain accurate information that suits your needs.

Concluding our article on company formation in Dubai for foreigners, it is clear that this city offers unique and attractive investment opportunities. The dynamic business environment, with legal and tax facilities, makes Dubai an ideal destination for international investors. With 100% ownership options in free zones, streamlined procedures and cultural diversity, new businesses have the opportunity to grow and prosper. However, successfully establishing a company requires a thorough understanding of the legal and administrative requirements. Therefore, it is advisable to seek the help of legal experts and consultants to ensure that the procedures proceed smoothly and achieve the desired goals. Taking the step of establishing a company in Dubai is an exciting start towards achieving your business ambitions, and exploring the endless possibilities in the global market. Whether you are looking to expand your business or start a new venture, Dubai has everything you need to succeed.