Learn about establishing a company in Dubai in terms of advantages and costs, because Dubai is considered one of the most prominent global destinations for establishing companies, as it combines a dynamic commercial environment with advanced government facilities. Many companies and entrepreneurs from around the world are seeking to take advantage of the diverse opportunities offered by this thriving city. Thanks to flexible economic policies and advanced infrastructure, Dubai has become an economic hub that attracts both foreign and local investments.

In this article, we will review the great advantages that make Dubai a preferred destination for establishing companies in Dubai , in addition to the costs associated with starting and operating a business in this global city. We will also cover the different types of companies that can be established in Dubai, helping you make the right decision on the optimal legal form for your company. Dubai is not just a place to establish a business, it is a gateway to the entire world, making it a strategic choice for anyone looking to expand their business and achieve sustainable success.

Advantages of establishing a company in Dubai

Dubai is considered one of the most prominent global destinations for establishing companies, thanks to a set of unique features that make it an ideal environment for business and investment. In this section, we will review the most prominent of these features:

Dynamic business environment

Dubai is characterized by a vibrant and diverse business environment, attracting companies from various sectors and industries. Thanks to its strategic location as a bridge between East and West, Dubai is a global business center providing access to huge markets in Asia, Europe and Africa. The city also hosts many international trade events and exhibitions that provide great opportunities for networking and building business relationships.

Low taxes

Dubai’s tax policy is one of the most attractive for entrepreneurs and investors. Dubai offers a low or even no tax regime in some cases, which enhances the competitiveness of companies and increases their revenues. Dubai does not impose personal income or corporate taxes in most sectors, making it an attractive destination for setting up a business.

Advanced infrastructure

Dubai is proud to have an advanced, world-class infrastructure, including modern transportation networks, advanced international airports, and leading sea ports. This advanced infrastructure provides ease of access and mobility, facilitating export and import operations and contributing to improving the operational efficiency of companies. In addition, Dubai provides advanced technology infrastructure that supports innovation and growth in various sectors.

Costs of establishing a company in Dubai

When deciding to incorporate a company in Dubai , it is essential to understand the costs associated with the incorporation and management process. These costs vary based on the type of company you wish to establish, its location, and your business requirements. In this section, we will review the most important costs to consider.

Establishment costs

Establishment costs include fees and initial procedures that must be done to obtain a business license and company registration in Dubai. Among these costs are:
1. Commercial license fees : They vary depending on the type of commercial activity and the region in which the company is established, whether it is in a free zone or in mainland Dubai.
2. Registration fees : Includes registration fees with the Department of Economic Development or the selected free zone authority.
3. Legal documents costs : These include preparing and drafting the articles of incorporation, authenticating official documents, and attorney fees if necessary.
4. Costs of obtaining an office : whether renting a physical office or obtaining a virtual office service.

Operational costs

Operational costs are those related to the management and operation of the company on a day-to-day basis. They include:
1. Rental costs vary based on location and office size.
2. A budget must be allocated to pay employee salaries, health insurance costs, and other benefits.
3. Includes electricity, water, Internet, and phone costs.
4. A budget allocated to promote the company and its products or services.

Government fees

The government in Dubai imposes several annual fees that must be paid to ensure that the company continues to operate legally. Among these fees are:
1. Annual renewal fees for the commercial license: vary according to the type of business activity and region.
2. Residence renewal fees: If you have foreign employees, their residency renewal fees must be paid annually.
3. Insurance fees and guarantees: Some commercial activities may require the payment of insurance or the provision of financial guarantees.

Types of companies in Dubai

The types of companies that can be established in Dubai are varied to meet the needs of different investors and entrepreneurs. These companies can be classified into three main categories, namely free companies, domestic companies, and offshore companies. Here’s a detailed look at each of these types:

Type of Company	Properties	the site
Limited Liability Company (LLC)	– Joint ownership between foreigners and citizens. – The local partner owns 51% of the shares. – Specific legal requirements.	Main land
Public Joint Stock Company	– Shares can be traded on the financial market. – A large number of shareholders is required. – A management committee is required.	Main land
Private Joint Stock Company	– Shares are not available for public trading. – Fewer shareholders compared to a public company. – Restrictions on the transfer of shares.	Main land
Sole Proprietorship	– Owned by one individual. – Full responsibility lies with the owner. – Does not require a local partner.	Main land
Branch of a foreign company	– It can be entirely owned by a foreign entity. – The branch must be affiliated with the parent company. – Requires special approvals.	Main land
Company in the free zone	– 100% ownership by foreigners. – Tax exemptions. – Virtual offices can be used. – Faster registration procedures.	Free zones in Dubai
Private free zone company	– Similar to companies in free zones, but may provide additional benefits. – May be limited in activities or size.	Free zones in Dubai
Limited liability company in free zones	– 100% foreign ownership. – Ease of registration and procedures. – Fewer restrictions on commercial activity.	Free zones in Dubai
Cooperative company	– Shared ownership among a group of individuals. – Aims to achieve the common interest of the members. – Requires special registration.	Mainland or free zones

The benefits and requirements for each type of company vary based on the specific business and location. It is important to choose the most appropriate type based on your business needs and future plans.

 

Steps to establish a company in Dubai

Establishing a company in Dubai requires following a set of organized steps. Here are the basic steps to establish a company in Dubai:

1. Determine the type of company : Choose the type of company you wish to establish (limited liability company, joint stock company, branch of a foreign company, company in a free zone, etc.).
2. Choosing a Business : Determine what business activity your company will undertake, as some activities may have special requirements or licenses.
3. Choosing a trade name : Choose a trade name that complies with the rules of company registration in Dubai. Make sure the name is not already registered and complies with local laws.
4. Determine the location of the company : Choose a suitable location for the company, whether it is on the mainland or in one of the free zones. If choosing a free zone, check the availability of facilities and benefits.
5. Preparing the articles of incorporation : Prepare the company’s articles of incorporation, which includes details about the company structure, shareholders, and directors. This can be done in cooperation with a legal advisor.
6. Obtaining approvals and licenses : Obtain the necessary approvals and licenses from the relevant government agencies or regulatory bodies. This may include obtaining approvals from the Ministry of Economy, Department of Economic Development, or any other relevant body.
7. Submitting the required documents : Submit the necessary documents such as passports, personal photos, proof of address, and articles of association to the competent authority.
8. Company registration : Register the company with the relevant government authorities and obtain the company registration number.
9. Open a bank account : Open a bank account in the name of the company at a local bank in Dubai.
10. Obtaining final licenses : Obtain final licenses that allow you to start practicing business activity. These licenses may include a commercial license, industrial license, or professional license depending on the type of activity.
11. Employment of employees (if necessary) : If you plan to employ employees, arrange for them to be hired and obtain the necessary visas.
12. Rent an office or place of business : If you are on the mainland or need a place of business, rent an office or place suitable for the company.
13. Starting a business : After completing all procedures and licenses, you can start doing business and operating the company.
14. Comply with Local Regulations : Ensure compliance with all local regulations and taxes, and prepare accurate financial accounts.

If you need assistance with any of these steps, specialized consulting companies such as Itqan can provide comprehensive support.

In conclusion, it can be said that establishing a company in Dubai carries many advantages that make it an ideal destination for entrepreneurs and investors from all over the world. A vibrant business environment, low taxes, and advanced infrastructure are factors that attract companies to this thriving emirate. Although there are set-up and operating costs and government fees to take into consideration, the potential returns and business opportunities available make Dubai a rewarding choice.

By understanding the different types of companies available, whether freehold, onshore or offshore, investors can make informed decisions that align with their business objectives. Dubai is not only a financial and economic center but also a supportive environment that encourages innovation and growth. In short, if you are thinking about starting a company in Dubai, now is the time to take advantage of the opportunities and resources available in this global city. With good planning and effective management, your company can grow and thrive in this dynamic and business-friendly environment.

Frequently asked questions about establishing a company in Dubai