The United Arab Emirates is one of the world’s leading business destinations, thanks to its encouraging business environment and advanced infrastructure. The UAE has become a global hub for trade and investment, thanks to its flexible economic policies, tax exemptions, and diverse investment opportunities. Establishing a company in the UAE is an attractive option for many local and international investors. Establishing a company in the UAE requires a comprehensive understanding of the legal and procedural requirements, and careful planning to ensure the success and continuity of the project. In this article, we will review the steps and methods of establishing a company in the UAE, in addition to exploring the advantages that the UAE offers to investors and how to make the most of these opportunities.

Legal procedures related to company establishment

Establishing a company in the UAE requires following a series of legal procedures to ensure compliance with local laws and obtain the necessary licenses. Here is an overview of the main legal procedures involved in establishing a company:

1. Select the type of company: Select the type of company you wish to establish (such as a limited liability company, a joint-stock company, a sole proprietorship, or a free zone company).
2. Choosing a business name: Choose a business name that complies with local regulations. The name should not be similar to existing business names and should be consistent with the business activities.
3. Preparing the Memorandum of Association and Articles of Association: Preparing the Memorandum of Association and Articles of Association of the company, which includes details about the company’s structure, purposes, and information about the shareholders or partners.
4. Applying for a license: Apply for a commercial license from the Department of Economic Development (DED) if the company will operate outside the free zones. If the company is established in a free zone, the application must be submitted to the authority responsible for the free zone.
5. Office Rental: Rent an office that complies with the requirements of the responsible authority. The lease agreement must be submitted as part of the incorporation application.
6. Appointment of Directors and Representatives: Appointment of directors or legal representatives of the company. You may be required to provide documents proving their appointment.
7. Opening a company bank account: Open a bank account in the company’s name at a local bank. You will need to submit incorporation documents and obtain a certificate from the bank.
8. Company registration with government agencies: Register the company with the relevant government agencies to obtain national tax registration numbers and ensure compliance with social security requirements.
9. Obtaining special permits: Obtaining any special permits or licenses related to the company’s activity, such as building permits or health licenses if the activity requires them.
10. Chamber of Commerce Registration: Register the company with the local Chamber of Commerce to obtain a Chamber of Commerce Registration Certificate.
11. VAT Registration (if required): Register for VAT if the company exceeds a specified revenue threshold.
12. Review licenses and update information: Review licenses and ensure that all information is up to date in accordance with local laws and regulations.

Cost of establishing companies in the Emirates

The cost of setting up a company in the UAE varies based on several factors related to the type of company, its location, and the size of the business. Here is an overview of the basic cost elements without mentioning specific numbers:

1. Licensing fees: These include the fees paid to obtain the business license required to start the company’s business. The fees vary depending on the type of license and the business activity being carried out.
2. Rental costs: This includes the cost of renting an office or workspace, which depends on the location and size of the office. Free zones may offer excellent options in this regard.
3. Legal fees: These include costs associated with preparing and documenting legal documents, such as articles of incorporation, bylaws, and legal contracts.
4. Company registration costs: include the fees required to register the company with the relevant government authorities, including registration in the commercial registers.
5. Visa costs: Includes fees for issuing work and residence visas for employees and investors.
6. Bank fees: include fees related to opening a business bank account and managing the accounts.
7. Administrative fees: may include costs related to administrative services and assistance with registration and licensing procedures.
8. Recruitment costs: Includes the costs of hiring employees, including salaries, insurance, and other employee-related costs.
9. Insurance: Includes commercial insurance costs, such as hazard insurance and public liability insurance.
10. Operating costs: These include the day-to-day expenses of running the business, such as utilities, logistics, and raw materials.
11. Additional expenses: These may include unexpected costs or costs that arise during the incorporation process such as consulting and additional services.

Basic documents required to establish a company in the UAE

To set up a company in the UAE, there are a set of basic documents that you need to submit. The requirements vary slightly depending on the type of company and its location, whether it is on the mainland or in a free zone. Here are the basic documents required:

• Articles of Association: This document includes the legal texts that specify the terms and conditions of establishing the company, such as the business purposes and the rights and obligations of the partners.
• Trade name determination: A document containing the proposed name of the company, which must comply with the legal standards determined by the competent authorities.
• Required licenses: include the basic commercial license and the commercial activities to be practiced.
• Passports: Color copies of the passports of the founders and investors, which are used to verify their identities.
• Portraits: Portraits of founders or shareholders.
• Lease Agreement: A lease agreement for the company’s premises, which proves the company’s address in the UAE. This may require a signed contract with an approved leasing agency.
• Certificate of Good Conduct: Some entities may require applicants for a license to submit a certificate of good conduct.
• Signatures: Signature of the company founders on all required legal documents.
• Business Plan: A summary or business plan that outlines the company’s business goals and the activities it will undertake.
• Bank details: Documents related to opening a business bank account, such as a letter from the bank explaining the account opening and its details.
• Approval from relevant authorities: In some cases, you may need approval from regulatory authorities or specific bodies specific to the business you intend to conduct.
• Legal Powers of Attorney: If a legal representative is appointed, legal powers of attorney must be submitted authorizing him to carry out the necessary procedures on behalf of the company.
• Special Permits: For some business activities, additional permits may be required related to the specific sector or field.

At the end of our article on establishing companies in the Emirates, we find that the economic environment in the country provides tremendous opportunities for investors and entrepreneurs. Thanks to its strategic location, advanced infrastructure, and political and economic stability, the Emirates has become one of the most attractive destinations for establishing businesses. Its distinction in providing a favorable business environment for investors makes it an excellent choice for individuals and companies seeking to grow and expand in global markets.

Starting a business in the UAE can be a bit complicated, but knowing the basic steps and procedures involved can make the process much smoother. From determining the type of company and choosing the right name, to preparing the required documents and submitting licensing applications, every step is part of the journey towards building a successful business. Adhering to legal requirements and implementing the procedures accurately increases your chances of success and ensures that you are in compliance with all regulations and laws.

In addition, the choice of location of the company, whether on the mainland or in one of the free zones, plays a major role in determining the success of the business. Free zones offer many advantages such as full foreign ownership and tax exemptions, while the mainland area provides opportunities for expansion in the local market.

The most important frequently asked questions about establishing companies in the Emirates