There are many ways you can set up a business in the UAE.
The most common way is to have a UAE national as your partner and they own 51 percent of shares. Though when this is not an option, the free zones in the UAE have become increasingly popular. This is where 100 percent foreign ownership is allowed.
The UAE free zone area offers a special tax-free status and low trade barriers where goods can be manufactured, exported and imported, handled, or reconfigured without having to pay any customs duty. Free zone areas are most commonly found at the national borders, international airports, and major seaports so that trading advantages can be utilized.
Entities allowed to set up business in the UAE Free Zone Areas.
Setting up a business in any UAE free zone is rather easy because the government is easing the company formation process to maximize the number of foreign investors with minimal capital investment to want to trade there.
There are three types of entities one can set up in the UAE free trade zones:
- Branch of a foreign or local company
- Free Zone Establishment (FZE), with a single shareholder
- Free Zone Company (FZC), with 2 to 5 shareholders
What are the different licenses available in the UAE Free Zones?
To be able to conduct business in the UAE, you need to ensure that you have a business license. These are the ones that can be obtained by any applicants in the UAE free zones:
- General trading license
How to get started setting up a business in one of the UAE free zones.
Any business that starts up in a free zone is not subject to commercial company laws. It is because these businesses are being conducted outside of the jurisdiction of the UAE and have their own set of rules and regulations.
The main reasoning behind this is to attract a wide audience of foreign investors into the country. The free zones are excellent for all types of opportunities and are very easy to set up.
These are five things that you need to do to get started:
- Determine the type of legal entity
- Choose a trading name
- Apply for a business license
- Register your business and get your license
You also need to get some documents together that will need to be translated into English if it isn’t already and then attested and notarized by the Gulf Cooperation Council (GCC) or the Arab Embassy.
- Duly filled application license form
- Business card of the contact person
- Copy of business plan
- Notarized and attested Memorandum of Association (MOA) and Articles of Association (AOA)
- Passport copies of the partners and business managers
- Original bank reference letters and license of the partner’s existing company, if applicable
Documents for Consultancy License
- A copy of the degree or diploma certificate mentioning the desired activities, or the experience certificate, these are a must
Documents for Industrial License
- Business feasibility study
- Existing company profile
- Duly filled form for the investor’s project profile
Documents for Branch of Companies
- Attested copy of the registration certificate, incorporation certificate, and the Memorandum and Articles of Association (MAA)
- Original Board Resolution that guarantees financial commitment of the branch
- Original Power of Attorney of a legal representative, and their passport copy
- Last 3 months’ bank statements of the parent company
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