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Steps To Get A Business License In Dubai

steps to get a business license in dubai

Dubai Company Register: Given below are the Procedures to be followed to avail business license and registration process in Dubai

To carry out any type and category of business in Dubai, it is essential to have valid ‘trade’ license.

Trade license requirements and necessary permissions may vary from different government ministries and agencies, depending upon the business category. It means that some business types, like health services, financial services, food trading, printing & publishing, etc. tend to require more clearances when compared to general trading business.

For company registration in Dubai, basically, there are issued three categories of licenses. However, license is issues depending entirely upon the activities that the business entity is to take. They are as follows:

Commercial License: It is issued to companies engaging in any type of trading activities.

Industrial License: It is issued to companies engaging in any industrial or manufacturing activity.

Professional License: It is issued to craftsmen, artisans, professionals and service providers.

Issuance of licenses to establish companies in Dubai is the responsibility of the DED (Dubai Dept. of Economic Development). For delivering licensing services, this department operates from different locations.

Dubai Company Register: Business Licensing Requirements

To register a business in Dubai, following are the approval procedure:

  • Additional approvals and endorsements might be necessary from other government departments by companies involved in oil or gas production.
  • License issuance for manufacturing companies is to have Finance & Industry Ministry approval.
  • Business registration is to involve Dubai Chamber of Commerce & Industry.
  • License issuance for financial institutions and banks need to have UAE Central Bank approval.
  • License issuance for pharmaceutical and medical products is to have Health Ministry approval.
  • License issuance for companies belonging to the insurance sector including other relevant companies is to have Economy & Commerce Ministry approval.

Business ownership requirements

Each and every Company other than the one having professional license that are established anywhere in the UAE (United Arab Emirates) or in Dubai need to have at least 51% shareholding by local UAE nationals.

There are however few exceptions to the above mentioned requirement s with any of the seven conditions given below:

  • Company established at Dubai’s Free Zone (at any place).
  • Where there is granted professional license for professions like artist, doctor, architect, etc. There can be 100% foreign ownership. But there needs to be a local national to act as ‘service agent’.
  • Where GCC wholly owned company gets into partnership with another organization that is owned entirely by UAE nationals.
  • There is permitted 100% ownership for GCC entities or nationals, in specific activities.
  • In professional or artisan companies, where there is allowed complete foreign ownership.
  • In case of any foreign entity registering branch office or representative in the UAE.
  • In cases, where 100% local ownership is required by law.

Legal business structures

It is the type of business structure that is considered to be a major consideration with business registration made in Dubai as well as other Emirates.

7 legal structures are defined by the Federal Law for business organizations, which are as follows :-

  • Public Shareholding
  • Joint Venture
  • General Partnership
  • Share Partnership
  • Limited Liability
  • Private Shareholding
  • Partnership in Commendams

Generally, medium and small sized companies are known to use points 5 & 6 mentioned above.

Branch Office or Representative set up

Representative or branch office in Dubai of any foreign entity is allowed as 100% foreign owned. But this privilege can be derived only on appointment of a local agent. The said local agent is to be UAE national or probably 100% UAE nationals’ owned company.

Establishing branch office or representative in Dubai might be a consideration that is worth the try, when few foreign entities are taken into account. For this option, Commercial Companies Law covers Dubai business registrations.

Based upon foregoing details and facts, Dubai company registration as well as registration anywhere in the UAE is termed as a procedure that is free from all complications.

Procedure for company registration in Dubai

Step 1: First, identify the prospective local partner – ‘Sponsor’. It is a crucial step and does require careful consideration as to the type of services expected to be provided by the sponsor.

  • Is the sponsor expected to solve your problems that you face with government procedures? or,
  • Are you just interested to use his name on your business license only and nothing else?
  • What amount of fees are you ready to provide annually?

Many potential problems can be eliminated by having excellent rapport with the sponsor.

Step 2: Derive activity approval and name from the DED (Dept. of Economic Development).

Application can be made and submitted at DED on standard application form.

Step 3: Identify appropriate business premises and prepare tenancy contract. Business premises evidence is an absolute necessity by tenancy contract for all businesses planning to get registered and start operation in Dubai.

Step 4: Sit with the sponsor to prepare MOA (Memorandum of Association) and submit the same to DED.

Memorandum can be created by any registered legal firm and is to specify ownership percentage and special arrangements made amongst all partners.

Step 5: Submission of License and MOA application is necessary at the DED along with the essential tenancy contract and other legal documents. It is during this stage that all required fees and charges need to be paid and cleared. License applied for, will be provided by the concerned department after a week or so.

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