How to Start a Business in Dubai Mainland (Guide 2023)

How to Start a Business in Dubai Mainland: Starting a business in Dubai Mainland can be an exciting and lucrative venture. With its strategic location, robust economy, and business-friendly environment, Dubai offers numerous opportunities for entrepreneurs.

However, navigating the process of setting up a business in Dubai Mainland can be complex. This article aims to provide a comprehensive guide on how to start a business in Dubai Mainland, covering the key steps, legal requirements, and important considerations.

A Comprehensive Guide on How to Start a Business in Dubai Mainland

1. Understand the Legal Structure:

Before starting a business in Dubai Mainland, it is crucial to understand the legal structure options available. The most common legal structures include Sole Proprietorship, Limited Liability Company (LLC), and Civil Company.

Each structure has its own requirements, benefits, and limitations. Research and choose the structure that aligns with your business goals and objectives.

2. Determine the Business Activity:

Identify the specific business activity or activities you wish to undertake in Dubai Mainland. The Department of Economic Development (DED) in Dubai has a comprehensive list of over 2,000 business activities. Ensure that your chosen activity is permitted and falls within the scope of your chosen legal structure.

3. Choose a Business Name:

Selecting an appropriate business name is crucial. The name should be unique, relevant to your business, and comply with the naming guidelines set by the DED. Conduct a thorough search to ensure that your chosen name is not already registered by another entity.

Read: How to Open Crypto Company in Dubai

4. Engage a Local Sponsor:

For most legal structures, engaging a local sponsor or service agent is mandatory. A local sponsor is a UAE national who holds 51% ownership in the company.

However, the profit-sharing and management responsibilities can be mutually agreed upon through a legal agreement. It is advisable to seek professional advice to ensure compliance with local regulations.

5. Prepare the Legal Documents:

To start a business in Dubai Mainland, you will need to prepare several legal documents, including a Memorandum of Association (MOA), Articles of Association (AOA), and a lease agreement for a physical office space.

These documents outline the ownership structure, business activities, and other essential details. Engage a legal professional to assist you in drafting and reviewing these documents.

6. Obtain Approvals and Licenses:

Depending on your business activity, you may need to obtain specific approvals and licenses from relevant authorities. The DED is the primary authority responsible for issuing trade licenses in Dubai Mainland.

Additional approvals may be required from industry-specific regulatory bodies, such as the Dubai Health Authority or Dubai Municipality. Ensure that you fulfill all the necessary requirements and submit the required documentation.

7. Secure a Physical Office Space:

Dubai Mainland businesses are required to have a physical office space. The size and location of the office will depend on the nature of your business activity. The lease agreement for the office space must be attested by the Real Estate Regulatory Agency (RERA) and registered with the Ejari system.

Read: How to obtain a General Maintenance License in Dubai, UAE?

8. Register with the DED:

Once you have obtained all the necessary approvals, licenses, and legal documents, you can proceed to register your business with the DED. Submit the required forms, pay the registration fees, and provide all the supporting documents. The DED will review your application and issue the trade license upon approval.

9. Open a Corporate Bank Account:

To operate your business effectively, it is essential to open a corporate bank account in Dubai. Choose a reputable bank that offers suitable services for your business needs. Provide the necessary documentation, including your trade license, legal documents, and identification proofs, to open the account.

10. Comply with Tax and Employment Regulations:

Ensure that you comply with all tax and employment regulations in Dubai Mainland. Register for VAT (Value Added Tax) if your business meets the threshold requirements. Familiarize yourself with labor laws, employee visa requirements, and other relevant regulations to avoid any legal complications.

Starting a business in Dubai Mainland requires careful planning, adherence to legal requirements, and a thorough understanding of the local business environment.

By following the comprehensive steps outlined in this guide, you can navigate the process successfully and establish a thriving business in Dubai Mainland. Remember to seek professional advice and stay updated with the latest regulations to ensure compliance and long-term success.

Cost of Setting up a Company in Dubai Mainland

Setting up a company in Dubai Mainland: A Comprehensive Overview of Costs

Dubai, the business hub of the Middle East, presents abundant opportunities for entrepreneurs looking to establish their presence in the region. Setting up a company in Dubai Mainland offers several advantages, including access to a vast marketplace, strategic location, and a business-friendly environment.

However, it's essential to understand the costs involved in this process to make informed decisions. In this article, we will delve into the expenses that one might encounter while setting up a company in Dubai Mainland.

1. Business License: Obtaining the right business license is a crucial step in establishing your company. The cost of a business license in Dubai Mainland can vary depending on the nature of your business activity.

Licenses can be categorized into commercial, professional, or industrial. Commercial licenses, required for trading and commercial activities, have different costs compared to professional licenses, which are compulsory for service-based businesses. Typically, business license costs range from AED 10,000 to AED 50,000.

2. Company Registration: To register your company in Dubai Mainland, you will require the services of a local sponsor or partner, who will hold a 51% share in the company.

The cost of finding a sponsor can vary significantly depending on the agreement you reach. Additionally, there will be costs associated with drafting legal contracts and notarizing documents, which can amount to AED 5,000 to AED 10,000.

3. Office Space: Renting an office space is a mandatory requirement for mainland companies. The cost of office space depends on several factors such as location, size, and facilities. Dubai offers a wide range of options, from free zones to commercial areas. On average, expect to pay around AED 70 to AED 200 per square foot annually for office rental.

4. Visa and Labor Costs: When setting up a company in Dubai Mainland, you will need to budget for visa and labor costs. This includes visa fees for you and your employees, as well as work permits and Emirates ID cards.

Additionally, there are expenses related to medical tests, health insurance, and other administrative costs. These costs can vary significantly depending on the number of employees and their designations.

5. PRO Services: Public Relations Officer (PRO) services play a vital role in navigating the bureaucratic processes involved in setting up a business in Dubai Mainland.

These services include document clearing, visa processing, and other government-related tasks. The cost of PRO services can range from AED 5,000 to AED 15,000 per year, depending on the complexity of the tasks.

6. Marketing and Advertising: To ensure the success of your business, it's essential to allocate funds towards marketing and advertising. The cost of marketing campaigns, branding, website development, and online advertising can vary depending on the scope and scale of your business operations.

7. Miscellaneous Costs: Apart from the aforementioned expenses, it's essential to consider additional costs such as utility connections, insurance coverage, and other miscellaneous expenses. These costs can vary depending on the size and nature of your business.

In conclusion, setting up a company in Dubai Mainland offers tremendous opportunities for growth and success. However, it's crucial to consider the costs involved in the process. From business licenses to office rentals, visa fees to marketing expenses, every aspect requires careful budgeting and planning.

By conducting thorough research and seeking professional guidance, you can navigate the process efficiently and set up your business successfully in Dubai Mainland.

How much is Dubai mainland license fees?

Unlocking the Cost: Dubai Mainland License Fees Demystified

Dubai has emerged as a global business hub, attracting entrepreneurs and investors from around the world. With its favorable tax policies, strategic location, and world-class infrastructure, setting up a business in Dubai mainland offers numerous advantages.

However, one crucial aspect that potential business owners need to consider is the cost associated with obtaining a mainland license. In this article, we will delve into the intricacies of Dubai mainland license fees to help you understand the financial implications of starting a business in this vibrant city.

Understanding Dubai Mainland Licenses:

Before diving into the costs, it is essential to comprehend the concept of mainland licenses in Dubai. Mainland licenses allow businesses to operate within the boundaries of Dubai mainland, giving them unrestricted access to the local market.

These licenses are issued by the Department of Economic Development (DED) and are subject to specific regulations and requirements.

Factors Influencing License Fees:

Several factors influence the cost of obtaining a Dubai mainland license. The fees depend on the nature of the business activity, the size of the company, and the location of the business premises.

Additionally, the type of legal entity chosen, such as a sole proprietorship, partnership, or limited liability company (LLC), also affects the license fees.

Cost Breakdown:

1. Trade Name Reservation Fee: Before applying for a mainland license, businesses need to reserve a trade name. The reservation fee typically ranges from AED 200 to AED 1,000, depending on the duration of the reservation.

2. Initial Approval Fee: Once the trade name is reserved, businesses must obtain initial approval from the DED. This fee varies between AED 500 and AED 1,000, depending on the business activity.

3. Commercial License Fee: The commercial license fee is the primary cost associated with obtaining a mainland license. It depends on the type of business activity and can range from AED 10,000 to AED 50,000 or more.

4. Office Space Rental: Dubai mainland licenses require businesses to have a physical office space. The cost of renting an office depends on the location, size, and facilities provided. This expense can significantly impact the overall cost of setting up a business in Dubai mainland.

5. Local Sponsorship Fee: In most cases, foreign investors are required to have a local sponsor or partner who holds a majority share in the company. The sponsorship fee varies based on the agreement between the parties involved.

Additional Costs:

Apart from the license fees mentioned above, businesses should also consider other associated costs, such as visa fees, employee sponsorship fees, insurance, and ongoing renewal fees. These costs may vary depending on the number of employees and the specific requirements of the business.

Setting up a business in Dubai mainland offers immense opportunities, but it is crucial to be aware of the associated costs. Dubai mainland license fees depend on various factors, including trade name reservation, initial approval, commercial license, office space rental, and local sponsorship.

Understanding these costs will help entrepreneurs make informed decisions and plan their budgets accordingly. It is advisable to consult with business setup experts or PRO services to navigate the intricacies of obtaining a Dubai mainland license and ensure compliance with all legal requirements.

What is mainland license vs freezone Dubai?

Dubai Mainland License vs. Freezone License: Understanding the Differences

Dubai has become a global business destination, attracting entrepreneurs and investors from all corners of the world. When it comes to setting up a business in Dubai, two popular options are mainland licenses and freezone licenses.

Each option offers distinct advantages and considerations. In this article, we will explore the differences between mainland licenses and freezone licenses to help you make an informed decision about which option suits your business needs.

Mainland License:

A mainland license allows businesses to operate within the boundaries of Dubai mainland, giving them access to the local market. The Department of Economic Development (DED) is responsible for issuing mainland licenses. One of the key features of a mainland license is that businesses can trade directly with the local market without any restrictions.

Advantages of a Mainland License:

1. Access to Local Market: With a mainland license, businesses can tap into the vast local market of Dubai and the United Arab Emirates (UAE) without any limitations.

2. Flexibility in Business Activities: Mainland licenses offer a wide range of business activities, allowing entrepreneurs to explore diverse sectors and expand their operations as needed.

3. No Minimum Capital Requirement: Unlike freezone licenses, mainland licenses do not have a minimum capital requirement, providing more flexibility for startups and small businesses.

4. No Limit on Office Locations: Businesses with a mainland license can establish their offices in any location across Dubai mainland, giving them the freedom to choose the most suitable area for their operations.

Freezone License:

A freezone license allows businesses to operate within designated freezones in Dubai. Each freezone has its own regulations, benefits, and restrictions. Freezones are designed to attract foreign investment and provide various incentives to businesses, including tax exemptions, 100% ownership, and simplified company setup procedures.

Advantages of a Freezone License:

1. 100% Ownership: One of the most significant advantages of a freezone license is that it allows foreign investors to have 100% ownership of their company, without the need for a local sponsor or partner.

2. Tax Benefits: Freezone companies enjoy tax exemptions on corporate and personal income taxes, import and export duties, and capital gains taxes.

3. Easy Company Setup: Freezones offer streamlined company setup procedures, with minimal paperwork and faster processing times compared to mainland licenses.

4. Networking Opportunities: Freezones often host networking events, seminars, and exhibitions, providing businesses with opportunities to connect with like-minded entrepreneurs and potential clients.

Considerations for Choosing the Right License:

1. Business Activities: Consider the nature of your business activities and whether they require direct access to the local market or can be conducted within the confines of a freezone.

2. Ownership Structure: Evaluate whether you prefer 100% ownership or are open to having a local sponsor or partner.

3. Market Reach: Determine your target market and assess whether a mainland license or a freezone license would provide better access to your desired customer base.

4. Cost Considerations: Compare the costs associated with obtaining and maintaining a mainland license versus a freezone license, including license fees, office space rental, and visa expenses.

FAQs on How to Start a Business in Dubai Mainland

1. What are the legal requirements to start a business in Dubai Mainland?

To start a business in Dubai Mainland, you need to obtain a trade license, secure a physical office space, and register your company with the Department of Economic Development (DED).

2. What are the types of trade licenses available in Dubai Mainland?

There are three types of trade licenses in Dubai Mainland: commercial, professional, and industrial licenses. The type of license you need depends on the nature of your business activities.

3. Can foreigners start a business in Dubai Mainland?

Yes, foreigners can start a business in Dubai Mainland. However, they are required to have a local sponsor, who can either be a UAE national or a company wholly owned by UAE nationals.

4. What are the steps involved in registering a business in Dubai Mainland?

The steps to register a business in Dubai Mainland include choosing a business name, obtaining initial approval from the DED, drafting the Memorandum of Association, and obtaining the necessary approvals from relevant authorities.

5. What are the benefits of starting a business in Dubai Mainland?

Starting a business in Dubai Mainland offers various benefits, such as access to a large consumer market, proximity to major transportation hubs, and the ability to trade freely within the UAE and internationally.

6. Are there any restrictions on foreign ownership in Dubai Mainland?

Yes, there are restrictions on foreign ownership in certain sectors. Some activities require a UAE national or a company wholly owned by UAE nationals to hold at least 51% ownership.

7. What are the costs involved in starting a business in Dubai Mainland?

The costs involved in starting a business in Dubai Mainland include trade license fees, office rent, visa fees, and other miscellaneous expenses. The exact costs vary depending on the type and size of your business.

8. How long does it take to start a business in Dubai Mainland?

The timeline for starting a business in Dubai Mainland can vary depending on various factors, such as the type of business and the efficiency of the registration process. On average, it can take anywhere from two to four weeks.

9. Are there any specific regulations or requirements for certain industries?

Yes, certain industries may have specific regulations or requirements. For example, businesses in the healthcare or food sectors may need additional approvals from relevant authorities.

10. Can I operate my business from a virtual office or a flexi desk in Dubai Mainland?

No, Dubai Mainland requires businesses to have a physical office space. However, there are options available for smaller businesses, such as shared office spaces or co-working spaces, which can provide cost-effective solutions.

Conclusion:

Choosing between a mainland license and a freezone license in Dubai depends on various factors, including business activities, ownership preferences, market reach, and cost considerations. Mainland licenses offer direct access to the local market, flexibility in business activities, and no minimum capital requirement.

On the other hand, freezone licenses provide 100% ownership, tax benefits, streamlined setup procedures, and networking opportunities. It is crucial to thoroughly research and consult with experts to make an informed decision that aligns with your business goals and objectives.

Now that you know very well on how to start a business in Dubai Mainland as well as the cost of setting up a company in Dubai Mainland.

Though it differs on a lot of factors but you have an idea on how much is Dubai mainland license fees and what is mainland license vs freezone Dubai. If you want to start your business in Dubai, please WhatsApp us at +44 7529694074 & book your free business consultation.