Business Start Up

Business Startup UAE | 5 Do’s and Don’ts Before Registering Your UAE Company

Business startup UAE: There are many options so it is better to know what you are getting into

Dubai’s strategic business infrastructure of no taxes and free markets in manpower, materials, money and intellectual property attracts international investors.

If yes, then please invest 2 minutes of your time to watch the video about business startup UAE below. It spells out how you can benefit. Or if you prefer to read, then feel free to skip the video and go straight to the text below:

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Relatively low crime and political stability help.

The traditional and current trends are attractive to businesses in trade, with the surrounding billion plus market.

The other area of opportunity are those who can capitalize on the rapidly growing tourist traffic.

Before you register your UAE company and start your business look at the 5 do’s and don’t s below.

Business Startup UAE: 5 Do’s

1. Business Startup UAE: Select a UAE national as a Sponsor

There are plenty of business opportunities available in Dubai, as well as in the entirety of UAE. However, if you really want to start a business which exploits the potential of Dubai then you need a locally registered LLC business or a Professional license.

For a local business, a UAE national must be taken as a 51% partner who is called a local Sponsor. A local company provides the freedom to locate the business anywhere in the city.

For a business startup UAE this is a boon because it affords the best choice of locations to suit your budget.

Business Startup UAE | 5 Do’s & Don'ts Before You RegisterA Sponsor must be paid a yearly fee which can be negotiated.

Do develop a rapport with your Sponsor so that he is ready to help you in sorting out any problems you may face along the way with the authorities.

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2. Business Startup UAE: Select a Free Zone if you wish to own your business 100%

The only way to register your UAE company without a UAE national as a Sponsor is to be located in one of the UAE free zones. Which is practically not suited to businesses that must be in the city markets like restaurants and retail stores.

Not to mention the fact that purchase or rental in a Free Trade Zone district might be high for your budget to handle.

So for a UAE business startup, a free zone offers three great advantages – 100% ownership, speedy start up and a Duty-Free customs boundary.

3. Business Startup UAE: Select a Location that optimizes business objectives, convenience and costs

Another important step in planning a business startup in the UAE is to determine the most suitable location for the business. Setting up a profit-based enterprise in a free zone wouldn’t do you much good, if you are customers or clients can’t reach you.

You need to set up your business in an area that is most profitable for your business or most convenient to your business. A location in the city can be selected for a shop or an office most known for the type of product or service you are dealing with.

If you are planning a Free Zone company then you must be make the selection based upon the criteria of distance, costs and if it is suitable for your product, business model, and trade requirements.

A tenancy contract must be concluded. If you’re aiming to start a small-scale enterprise, then the basic amenities, like telecommunication, storage, and space inside the establishment is the basic concern that must also be satisfied. Other services available in the commercial property can vary greatly.

4. Business Startup UAE: Confirm your Visa requirements and eligibility

For a business startup in the UAE, a visa permitting you and employees to live in UAE is essential to run the business in Dubai.

Visas are allowed for almost all businesses.

However, their number varies according to a variety of criteria such as the size of the office, nature of business, category, of the employee or the investor.

If your business startup is a local company then you definitely need to work with your sponsor to get your visas – at least the first time.

Business visa applications in Dubai are not strict. The procedure is quite open to foreign investors. Any business is good business is the motto here.

However, you need to have your sponsor apply a visa for you as the investor of the business startup if it is a local company. You can do this yourself for a free zone company.

Aside from your passport and other legal requirement, a letter is also needed from your sponsor to highlight his or her, or your personal information, reason for the visa application, and the likes before processing.

Business Startup UAE | 5 Do’s & Don'ts Before You RegisterSubsequently you may be allowed to apply for the visas of your employees if your sponsor agrees to give you the authority.

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5. Business Startup UAE: Hire a UAE company registration agent to take you through the process

As a foreign investor, hiring a UAE company registration firm to register your business may be the preferred route.

These firms not only hold your hand right thru the setting up process but also actually do the company set up for you. A new business may find their expertise in dealing with the local government bureaucracy and with free zone authorities to be of great help in planning and execution.

Also, they will take care of all the necessary requirements to help you have your business registered legally without any problems on your end.

Business startup UAE: 5 Don’t s

1. Business Startup UAE: Do not register your company in a Free Zone without taking a look at the available office sizes and preconditions

Often the published information for a Free Zone gives a wide choice of offices. The actual availability keeps changing. A business startup normally looks for the cheapest option.

It may be possible that when you actually go for registration of the company you may find that only certain office sizes are available. This will throw your budget into disarray.

Business Startup UAE | 5 Do’s & Don'ts Before You RegisterIt may be too late to change your Free Zone then. Or it may happen that certain offices allow only 1 visa that too only for investor and not for the employees.

So do not proceed until all aspects about the office are confirmed.

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2. Business Startup UAE: Do not make firm plans based only on published information

Before you finalize the plans for your business startup it is prudent to confirm the validity of the published information.

Rules change in Free Zones and also in the local Department of Economic Development for business registration.

Do not go ahead until you have confirmed your assumptions through a business set up consultant or by actually contacting the relevant authority.

You may discover that some additional documents may be needed, or that some nationalities need special permissions, or that some requirements may be waived if you request or negotiate.

3. Business Startup UAE: Do not choose a license category blindly without confirming if it allows your business model

Make a wide search about the various license categories available that fit your business model. There are literally 100s of licenses.

So choose a category that allows you to grow and add products in the future.

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4. Business Startup UAE: Do not open a bank account without confirming the bank charges

Banks levy varying charges. For a business startup in the UAE, these can amount to a substantial sum for a bank dependent operation.

Always confirm the requirements and charges beforehand. Do not choose a bank based on only the reputation.

5. Business Startup UAE: Do not agree to a Sponsorship arrangement without a written and notarized legal agreement

The business startup UAE may need a lot of support initially. A local sponsor may want to charge separately for some services.

Do not go ahead with sponsorship until both sides have agreed on what to expect from each other and a written agreement is drawn up. Do not rely only on a verbal understanding.

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Business Start Up was last modified: February 21st, 2022 by Ravindr Deshpande

Ravindr Deshpande

He’s an excellent thinker, is aware of what’s going on in his area and is very understanding’s people’s feelings.

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