Checklist to register a company in Dubai

Tally Solutions | Updated on: June 29, 2022

In our previous blog, we learnt about the numerous benefits that you will reap by setting up a business or a branch in the UAE. Now, after setting up your business in Dubai, there are a few basic steps which you must take before you start your business activities. Registering your business and getting a valid licence to run your business activities without any illegal repercussions is one of the most crucial things which you must keep in mind before kickstarting your business. Holding a ‘trade’ licence in Dubai is extremely important to run any kind of business. The issuance of trade licence and permissions required from other relevant agencies, organisations and government bodies varies, depending on the category of a particular business. Some businesses might require more clearances and permissions as compared to others. Let’s take a look at the categories of licences which are issued in Dubai to register a company.

Commercial Licence

A commercial licence is issued to a company that will engage in any kind of trading activity

Industrial Licence

An industrial licence is issued to a company that will engage in manufacturing or any industrial activity

Professional Licence

A professional licence is issued to service providers, professionals, artisans, and any individual who basically practices a specific profession.

The government agency which is responsible for issuing local Dubai company licences is the Department of Economic Development. Though this department operates from several locations, to get a comprehensive range of all services, the licence seeker must head to the main office which is located near the clock tower in Dubai.

These are the key steps to keep in mind during the approval process for a business registration

The licences issued for banks and other financial institutions must have the approval of the UAE Central Bank
The licences issued for manufacturing companies must have the approval of the Finance and Industry Ministry
The licences issued for companies engaged in insurance and other relevant firms must have the approval of the Economy and Commerce Ministry
The licences issued for medical and pharmaceutical products must have the approval of the Health Ministry
The licences issued for companies engaged in gas or oil production, additional endorsements and approvals from other government agencies may be needed
Additionally, Dubai Chamber of Commerce and Industry must also be closely involved in the process of business registration.

To have a valid business licence in the UAE, every business owner except the ones owing a professional licence is required to have no less than 51% shareholding by UAE nationals. These are the 6 conditions under which such companies would be considered as exceptions:

The company must be established or set up at any of the free zones in Dubai.
100% local ownership must be required
The company completely owned by the Gulf Cooperation Council (GCC) enters into a partnership with another company which is completely owned by UAE nationals.
100% ownership for GCC nationals or entities is permitted for certain activities
Registering a representative or a branch office in the UAE is a must in case of a foreign entity
In case of professional licences, the foreign ownership can be 100%, however, a local national must be taken as ‘service agent’

The most major consideration to register a business in the UAE is the choice of business structure which according to the Federal Law are defined under seven legal structures of business organisations:

General Partnership
Partnership in Commendam
Public Shareholding
Private Shareholding
Joint Venture
Share Partnership
Limited Liability

Check out the complete procedure to register your company to get it up and running in Dubai

Decide on your “sponsor” who will primarily be your local partner

This sponsor will be responsible for the roles that you would choose him for. A good rapport with the local partner can be of great help to you and your business as he could prevent several potential problems. This step is essential as you get to choose the kind of services you want to avail from the sponsor. Would you like your sponsor to:

Assist you in resolving your problem with the government procedures?
Just want his name on the licence and nothing else
You also get to decide the fees which you are prepared to pay your sponsor per year.

Get approval for your name and activity from the Department of Economic Development (DED). This can be applied for and done on a standard application form and submitted at DED

Since all business activities must be done within certain premises, look for the perfect location for your office and make a tenancy contract.

A Memorandum of Association (MOA) specifying a special arrangement and ownership among all partners must be submitted to DED.

The Licence Application and MOA and the tenancy contract along with all the legal documents must be submitted at DED. After this step, all the necessary charges and the fees levied must be paid and the licence will be received within a week.