
What types of businesses can foreigners establish in Dubai?
Dubai attracts entrepreneurs from all over the world. Each year, an increasing number of investors and international professionals, drawn by its favorable business environment, choose to settle in the emirate. Among recent initiatives is the long-term visa, which now allows foreigners to reside in the United Arab Emirates for extended periods and plan their retirement in the country. With appropriate support, non-residents from anywhere in the world can also establish and manage a company in the United Arab Emirates. StraFin, an international and cross-sectoral provider of corporate, trust, and fund administration services, gives you an insight into the steps for starting a business in Dubai as a foreigner.
Can foreigners start a business in Dubai?
Although starting a business abroad can be complex, Dubai offers a particularly favorable environment for foreign entrepreneurs. With a population comprising over 80% of people of foreign origin, the emirate fosters a culture of openness and hospitality towards entrepreneurs from around the world.
Three key points to remember
Unlike other countries, the emirate allows foreign entrepreneurs to fully own and manage their businesses, which attracts numerous global investors.
In addition to the Emirate’s attractive corporate tax regime, foreign entrepreneurs also benefit from streamlined administrative procedures and a stable political environment.
As a booming economic hub, Dubai offers a dynamic market and numerous business opportunities across various sectors.
Why start a business in Dubai?
Located at a strategic crossroads between Asia, Africa, and the Middle East, Dubai has established itself as a leading economic hub. Its state-of-the-art port, international airport, and excellent road connections facilitate trade.
Moreover, the city boasts an exceptional quality of life, with modern infrastructure, upscale residential neighborhoods, and a rich cultural blend. Business-friendly government policies, particularly in terms of taxation and innovation, make Dubai a true haven for foreign entrepreneurs.
The impressive expatriate community creates a multicultural and dynamic environment where new ideas are encouraged.
Did you know?
With a population of 2.2 million people, Dubai is an amazing cultural melting pot. Its dynamic economy, driven by tourism (4.8 visitors per inhabitant) and foreign investments, makes it one of the world’s most prosperous cities. According to official figures, more than 70 million passengers transit through its airport each year, and the electricity consumption per capita is one of the highest in the world.
Choosing your business structure in Dubai
The first decision to make when starting a business in Dubai is choosing the legal status, which will impact your company’s management, taxation, and liability. The two main options for foreign entrepreneurs are a Limited Liability Company (LLC) and a Sole Establishment.
Choosing the jurisdiction: Mainland vs Free Zones
In Dubai, you can set up a business either on the mainland or in one of the many free zones. Here are the key features of each option:
Criterion | Mainland | Free Zones |
Market | Local and International | Primarily International |
Creation Procedure | Systematic, license possible in 1 day | Varies by free zone |
Regulation | Subject to UAE laws | Specific regulations per free zone |
Benefits | Access to local market, flexibility | Tax exemptions, simplified procedures, specialized infrastructure |
Drawbacks | Longer administrative procedures, stricter regulation | Local market access restrictions |
Different types of business licenses
The Dubai Department of Economic Development (DED) delivers four main types of licenses, each suited to a specific type of activity. Let’s explore the characteristics of each:
Type of License | Main Activities | Competent Authority |
Commercial | Retail, wholesale, import-export | DED |
Professional | Services | DED |
Industrial | Manufacturing, packaging | DED |
Touristic | Hospitality, tourism | DED and DTCM* |
*Department of Tourism and Commerce Marketing
Steps to starting a business in Dubai as a foreign entrepreneur
Starting a business in Dubai is relatively simple. The main steps are as follows:
- Choose the legal status: sole proprietorship or limited liability company.
- Reserve the trade name: unique and compliant with regulations.
- Apply for a license: through the DED or the free zone authority.
- Official registration: legal establishment of the company.
- Obtain a business visa: for foreign applicants and their relatives.
The cost of starting a business in Dubai as a foreigner
The cost of a business license in Dubai varies depending on several factors: type of activity, location, and the specific needs of the business (e.g., an industrial kitchen for a restaurant). On average, expect to spend between 15,000 and 25,000 AED. Note that an additional fee of 2,000 AED is generally applied for trade names that do not meet the prevailing linguistic criteria.
Beyond the business license, certain activities require specific permissions. For example, businesses in the food sector must obtain a health permit from the municipality, while manufacturers need a production space compliant with standards.
Conclusion
Dubai offers entrepreneurs an exceptional environment with a dynamic economy, cutting-edge infrastructure, and a favorable business environment. By choosing Dubai for your project, you are investing in the future, and with Strafin by your side, setting up your business becomes easier. Our team of experts guides you through every step, from forming your company to obtaining your licenses and managing your daily operations. Contact us now to benefit from our expertise and start an exciting business venture in Dubai.
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