The United Arab Emirates is considered one of the most prominent investment destinations in the world, as it provides a flexible and diverse economic environment that provides broad opportunities for entrepreneurs and investors from different parts of the world. The UAE is characterized by an advanced infrastructure, a solid legal system, and policies supportive of foreign investment. All these factors make it an ideal destination for establishing companies and achieving commercial success.

Establishing a company in the UAE can be an important strategic step, whether you are seeking to expand your existing business or start a new business adventure. However, the process of opening a company in the UAE requires a deep understanding of the types of companies available, the steps required, and the costs and legal requirements associated with them.

In this article, we will review in detail the types of companies that can be established in the Emirates, and the basic steps that must be followed to establish a company in the Emirates , in addition to the costs and legal requirements that must be taken into account. The goal is to provide a comprehensive guide that can help you make informed decisions and make the most of the investment opportunities available in the UAE.

Conditions for opening a company in the Emirates

Types of companies in the UAE

The United Arab Emirates is characterized by an attractive economic environment for investors and entrepreneurs, as it provides a variety of options for establishing companies in the Emirates . These companies can be classified into three main types: free zone companies, local companies, and offshore companies. Each of these types has its own characteristics and benefits that make it suitable for certain purposes.

• Free zone company

Free zone companies are an ideal choice for foreign investors who want full ownership of their company without the need for a local partner. Free zones are located in strategic locations across the Emirates, such as Jebel Ali, Dubai Internet City, and Sharjah Media City. These free zones offer many benefits, including complete exemption from taxes on income and profits, freedom to transfer funds, and customs facilities. It also provides advanced infrastructure and integrated support services, making it an ideal environment for business growth.

• Local company

Local companies are a popular choice for investors who plan to do business within the UAE. Establishing a local company usually requires a national partner to own 51% of the company, while a foreign investor can own the remaining 49%. Local businesses offer many advantages, including access to a broad local market and tapping into a network of local relationships and resources. Local companies are the ideal choice for businesses targeting the internal market, such as retail, services, and manufacturing.

• Offshore company

Offshore companies are a suitable option for businesses conducted outside the UAE borders, and are often used for purposes such as asset management, tax planning, and international trade. Offshore companies are characterized by simplified and highly confidential incorporation procedures, in addition to exemption from local taxes. Offshore companies can be established in areas such as the British Virgin Islands, Seychelles, and the Cayman Islands. These companies are an ideal choice for investors looking for flexible and cost-effective international trading solutions.

Conditions for opening a company in the Emirates

Establishing a company in the UAE requires following specific steps to ensure compliance with local laws and regulations. Here we will review the conditions for successfully opening a company in the Emirates:

Choose the company type

The first step in starting a company is to determine the type of company that best suits your needs and business goals. There are three main types of companies in the UAE:

1. Free Zone Company: These companies allow businessmen and investors full ownership of the company without the need for a local partner. Free zones are characterized by the presence of developed infrastructure and simplified registration procedures.
2. Local company: These companies require a local partner to own a certain percentage of shares, usually 51%. These companies constitute the ideal choice for businesses targeting the local market.
3. Offshore Company: These companies are used for international business purposes and are registered in a free zone, but they cannot conduct business within the Emirates.

Obtaining approvals and licenses

After choosing the appropriate type of company, the necessary approvals and licenses must be obtained from the competent authorities. This process includes several steps:

1. Determine business activities: You must define the activities that the company will undertake and ensure that they comply with local laws.
2. Obtaining approvals: Some activities need special approvals from certain regulatory bodies.
3. Issuing licenses: After obtaining the necessary approvals, the required licenses are issued by the local economic departments.

company Registration

After obtaining approvals and licenses, comes the step of officially registering the company. This process includes:

1. Preparing legal documents: This includes preparing the company’s articles of association and articles of association.
2. Submitting the application: The registration application is submitted to the competent economic department, accompanied by the required documents.
3. Payment of fees: includes registration fees and license fees.
4. Receiving the registration certificate: After reviewing and approving the application, the Economic Department issues the company registration certificate, enabling the company to legally begin operations.

Costs and requirements for opening a company in the Emirates

When considering setting up a company in the UAE , it is essential to understand the costs and requirements associated with the process. Costs and requirements include several aspects, including government fees, legal requirements, and operational costs. In this section we will detail each of these aspects to help you do better financial and management planning.

Government fees

Government fees vary based on the type of company and the region in which the company will be established. When establishing a company in a free zone, government fees may include registration fees, annual licensing fees, and fees for other services such as issuing visas and work permits. If the company is local, it may require paying additional fees such as municipal fees and chamber of commerce fees. These fees can range from a few thousand to tens of thousands of AED, so it is important to contact the relevant authorities to get accurate estimates.

Legal requirements

Legal requirements include several procedures that must be followed to ensure the legal establishment of the company. Among these procedures are:
1. Submitting official documents such as a copy of the passport, personal photos, company incorporation certificates and shares.
2. Obtaining approvals from certain government agencies, which may include the Department of Economic Development and the relevant authorities in the free zone.
3. The company’s compliance with local laws and regulations, including labor and employment laws, and health and safety laws.
4. Submit a detailed business plan that explains the nature of business activities, goals, and strategies.

Operational costs

Operational costs are an important aspect to take into consideration when establishing a company. These costs include:
1. Office or commercial space rent: Rental costs vary based on the location and size of the space required.
2. Employee salaries and benefits: A budget for salaries and benefits must be established to ensure that talent is attracted and retained.
3. Administrative expenses: These include the costs of administrative services such as accounting, legal consulting, and information technology costs.
4. Marketing and advertising costs: To ensure the success of the company, a budget must be allocated for marketing and advertising to attract customers and build the brand.

In conclusion, it can be said that establishing a company in the UAE is an important strategic step for entrepreneurs and investors who seek to benefit from the thriving economic environment and advanced infrastructure in the country. The UAE offers various options for establishing companies, whether they are local companies, free zone companies, or offshore companies, giving investors great flexibility to choose the structure that best suits their needs and business goals.

By following the right steps and adhering to the legal and administrative requirements, investors can seamlessly establish their companies and benefit from the tax incentives and advanced services that the UAE offers. It is worth noting that establishment and operating costs may vary based on the type of company and location, so it is necessary to conduct a careful feasibility study and appropriate financial planning to ensure the success of the project.

In the end, the UAE constitutes an ideal environment for business growth and expansion, thanks to its strategic geographical location and its policies that support investment. Therefore, taking the step towards opening a company in the UAE can be the beginning of long-term success and the realization of many promising opportunities in the local and international market.

The most important frequently asked questions about opening a company in the Emirates