The United Arab Emirates (UAE) has emerged as a prime destination for entrepreneurs and businesses looking to establish a company, especially in the free zones. With ambitious projects driving economic growth and attracting global attention, there has never been a better time to start a business in the UAE.
Requirements for Company Formation in UAE
For Company formation in UAE, several prerequisites must be met. Let's explore the key requirements:
· Obtaining a License- A business in the UAE is primarily established to conduct specific activities. Depending on the nature of the business, one of three types of licenses can be obtained: commercial licenses for trading activities, professional licenses for services, artisans, and craftspeople, or industrial permits for manufacturing and industrial operations.
· Performing Free Zone Business- For company registration in the UAE, a local sponsor is typically required. The local sponsor must be an Emirati individual with majority ownership (51% or more) of the company. Profit-sharing agreements are often established between the foreign investor and the local sponsor to comply with this requirement.
Step-by-Step Process for Company Formation in UAE
Establishing a company in the UAE involves a systematic process that can be simplified with the assistance of corporate service provider Dubai. Here is a step-by-step overview:
· Selecting a Business Activity: Choose a free zone based on the nature of your business. Some free zones specialize in specific activities like the medical field, media, or transportation. Consider the market segment and the availability of transport connections, especially if your business relies heavily on imports and exports.
· Selecting a Company Name: Propose three names for your company, ensuring they comply with the naming regulations. Avoid objectionable language, names of nations, religions, or political parties. If the company is named after a person, that person must be an owner or partner. Seek assistance from a business consultant to expedite the process and save time.
· Completing the Incorporation Paperwork: Complete the application for your company's activities and provide the names of shareholders with their passport copies attached. Your business advisor will guide you through this paperwork-intensive process.
· Receiving License Notification: Once the paperwork is completed, the government will issue your business license, granting you the authority to operate legally.
· Establishing a Bank Account: Utilize the obtained papers to open a corporate bank account in one of the many banks available in the UAE. Your business consultant can assist you in selecting a bank that aligns with your company's requirements.
· Obtaining Your Visa: To conduct business in the UAE's free zones, you must apply for your visa as well as visas for your dependents and employees. The number of applications may vary depending on the chosen free zone. Seek guidance from business specialists to navigate the visa application process smoothly.
Documents Required for Company Formation in UAE
While the specific documentation may vary depending on the type of business, here are the general documents required for business setup in Dubai:
- Business plan submission form
- Notarized MOA (Memorandum of Association) and AOA (Articles of Association)
- Sponsor's passport copy as proof of UAE citizenship
- NOC (No Objection Certificate) that is being issued by sponsor
- Bank reference letter for each shareholder
· Additional documents for an industry license, including a feasibility study, existing company profiles, and investor information
Conclusion
Company Formation in UAE offers a practical and advantageous approach. The reduced tax burden and simplified compliance procedures make the UAE attractive for entrepreneurs. With the step-by-step process and the guidance of experienced business consultants, anyone can establish a business in a UAE-free zone. As the UAE's economic growth surpasses that of its neighboring countries, conducting thorough research and selecting reputable business consultants are crucial for successful company formation in the UAE.
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