Dubai is the flourishing business hub of the Middle-East. Not only this, but it is a thriving centre for UK businesses to establish themselves in. Overseas business owners are actively welcomed in the UAE, with company formation in Dubai offering a host of fantastic business opportunities.
Starting a company means many aspects to manage, but forming a company internationally involves even more considerations.
JMR Solicitors has been helping Dubai businesses in a legal capacity for several years. With a wealth of experience in international law, particularly Middle-East legislation, we are perfectly placed to advise on company formation in Dubai and all the key considerations involved.
Free Zones vs Mainland Company Formation
Free zones in Dubai, also referred to as free-trade zones, are trading zones that have been set up to incentivise international investors and businesses to trade in the UAE. These incentives come in the form of tax concessions and customs duty benefits. In the free zones, 0% corporation and personal tax can be taken advantage of, as well as 100% import and export custom duty exemption, plus 100% company ownership.
A free zone company (FZC) can trade with other companies within that free zone, as well as internationally. However, an FZC is not permitted to trade with the UAE mainland or Dubai.
A mainland company is allowed to trade both internationally and can do business within the UAE. In order for a mainland company to be set up in Dubai, a UAE resident is required as a sponsor. In this scenario, the shareholder (UAE resident) owns 51% of the company.
Moving a Foreign Business to Dubai
We’re going to be focussing on moving a business or forming a company in the Dubai free zones. The good news is that 80% of the population in Dubai is expatriate, with many of those owning a business.
Here are the things to consider, and steps to take, when approaching company formation in Dubai and the free zones.
Selecting a Free Zone
With over 50 free zones in Dubai, you should carefully consider which one you are going to trade in. Each zone has its own jurisdiction and set of regulations. Some offer more general opportunities, but others are best for more specific business activity. Examples of free zones are Dubai Media City, Dubai Internet City, Dubai Airport Free Zone, and Dubai Design District.
Location, transport links, and amenities should also be taken into account at this stage.
Paperwork & Documentation
Establishing a company in Dubai, just like in the UK, involves completing the incorporation process. As such, you’ll need to produce a series of documentation and paperwork. For this, you will need a:
- Company set up application
- Ultimate Beneficial Ownership (UBO) shareholder, director, and General Manager passports
- Legalised and attested UK company document copies (where applicable)
- Comprehensive and thorough business plan
- Two years’ audited financial reports for corporate entity or certificate of reference from a personal bank of the individual shareholder
- NOC from current sponsor (for individuals)
Company Licence
Once your application has been processed, you will be issued with your company licence. This is a step that must be done properly and legally, with adequate time dedicated to it.
There are a number of types of business licence in Dubai. These include commercial, industrial, and professional – the most common types.
Bank Accounts
In order to form a company in Dubai, you will need to open a corporate bank account. To do this, you will need to provide:
- UK company documentation such as Companies House details and a certificate of incorporation
- UAE business documentation, e.g. trade licence, certificate of incorporation, Chamber of Commerce registration, Memorandum and Articles of Association
- Shareholder and Ultimate Beneficial Owner (UBO) details, including copies of their passports, visas, utility bills and bank statements
Visas
The next step is to secure a UAE residency visa, which allows you to live and work in Dubai. Acquiring visas can only be done once the company has been set up in Dubai. The process of getting a visa is split into 4 stages: entry permit, status adjustment, medical fitness test, Emirates ID registration and visa stamping.
JMR Can Help Move Your Business to Dubai
Based in Manchester, JMR Solicitors is a team of experts able to offer legal advice and services for Dubai and UAE businesses. This includes businesses in the UK looking to set up shop in Dubai.
With extensive knowledge and experience, we can help with company formation in Dubai at every stage, from choosing the right free zone, to organising the necessary documentation. With tailored service to suit your individual business needs, moving your company to the UAE will be made stress-free.
To get help with moving your business to Dubai, contact one of our team today at info@jmrsolicitors.co.uk, or call +00 44 161 491 3933.