The United Arab Emirates (UAE) has drawn greater attention in recent times as an attractive part of the world in which to establish a business. This has been demonstrated by – among other developments – the West Asian country recording the highest score seen in the history of the Global Entrepreneurship Monitor (GEM) National Entrepreneurial Context Index (NECI).
The UAE’s score in this index, 7.7, was well ahead of the 6.6 recorded by the next-closest economy, India. It marked the third consecutive year in which the UAE had ranked first in the index, which is formulated on the basis of assessments made by entrepreneurs from across the globe.
These experts account for such factors as the level of business development and innovations in each country, as well as the condition of the local financial structure, and how easy it is to launch a business there. So, this result may encourage you greatly if you are seeking out the ideal territory in which to establish a business while also obtaining residency.
An enthralling life could await you in the UAE as an entrepreneur-resident
When the business-friendly environment is considered alongside the strong general quality of life and safety in Dubai – which is the UAE’s most populous city – it should be no great surprise that so many foreign nationals consider it as a base for starting a company.
Becoming a resident of Dubai through company formation would enable you to open a bank account in this part of the world, enrol your children in government or private schools, and enjoy the all-round rewarding lifestyle offered by this thriving metropolis. You would also gain visa-free access to various other countries. So, what is the process for establishing a company in Dubai and obtaining residency? Below, we have explained the key stages you will need to follow.
Can a UK resident set up a company in Dubai?
The short answer to this question is: yes, a UK resident definitely can establish a company in Dubai. However, as with any other process of setting up a business abroad, you will need to give careful thought to various factors, such as the likely market demand for your intended product or service, and how the business environment in Dubai would support this. It will also be crucial to familiarise yourself with the relevant local laws and regulations.
Taking the following steps will enable you to set up your own Dubai company as a UK resident:
- Determining the most suitable legal structure for your business, such as a partnership or limited liability company (LLC)
- Deciding on a company name, and securing approval for this from the relevant authorities
- Submitting the necessary documents to the Department of Economic Development (DED). This documentation should encompass a business plan, as well as passport copies and proof of residency
- Obtaining a trade licence from the DED
- Applying to the General Directorate of Residency and Foreigners Affairs (GDRFA) for a residency visa
- Opening a corporate bank account.
For comprehensive and tailored assistance with all aspects of establishing a Dubai company and potentially relocating to the UAE, please contact our award-winning specialists in immigration law at Cranbrook Legal today. You are welcome to call us in central London on 0208 215 0053, or to fill in and submit our online form to request a free consultation.
What do you need to think about before you set up a company in Dubai?
Of course, even when you establish a business in a highly entrepreneur-friendly part of the world such as Dubai, this will be no guarantee of its eventual success. With this in mind, you will need to consider the below matters before you commit to such a major course of action:
- Your reasons for wishing to set up a company in Dubai, rather than elsewhere. As we have already touched on in this article, there is a broad range of factors that helps make Dubai an excellent place to establish a business. These include the stimulating and varied economy of the city itself, as well as its advantageous location and favourable tax regime; we have elaborated on many of those benefits below.
- Whether there will be market demand for your company’s products and/or services. Although Dubai has a very diverse population – encompassing locals, expatriates, and tourists – it will still be crucial for you to develop a strong understanding of the distinctive demographics, psychographics, and economic environment of Dubai. You will need to be able to define your target market well, while accounting for market trends and evaluating the strengths and positioning of your competitors. The better you understand the likely market demand for your Dubai company’s offerings, the easier it will be for you to identify the best business activity and sector in which to invest.
- Which legal structure is likely to most suit your Dubai business. The question of which Dubai company structure to favour should be far from an afterthought; indeed, whichever structure you choose will serve as your business’s foundational design. Whether you opt for an LLC, a free zone company, or a joint venture – to cite just some possibilities – your choice will have implications for how ownership, management, and decision-making authority are allocated at your company, as well as other implications.
- The probable costs of establishing your company in Dubai. Even the initial setup costs for a Dubai business can run into many thousands of pounds, so it is of critical importance to be well-informed on all the necessary areas of expenditure in advance. It will cost you money to obtain a general trading licence, and there will be charges payable to Dubai Municipality, the Ministry of Economy, and the Dubai Chamber of Commerce. This is before such other expenses as office space rental, and visa fees for the recruitment of staff, are considered. Budgeting for all these areas of spending will help ensure the smoothest possible operation for your Dubai business.
Deciding between setting up a mainland or free zone company in the UAE
If you wish to qualify for Dubai residency through the formation of a company, you will be free to decide between establishing a mainland or free zone company. The decision that will best suit your company will depend on the goals and needs of your business:
- The UAE’s “free zones” are economic areas with their own regulations, and that present various potential benefits for businesses. These include the opportunity for 100% foreign ownership, as well as tax exemptions, and a simplified process for registering a business. A free zone company is able to trade internationally and within the free zone, but it is not generally able to trade on the mainland. So, if you wish to deal with international clients when running a Dubai company, a free zone company will allow you to do this.
- The “mainland” in Dubai is also referred to as the “onshore” area. Mainland companies in Dubai are able to carry out a broad range of permitted activities, whereas in the case of most free zones, only a subset of permitted activities is available, depending on the specialisation of the given zone. If you intend to sell your business’s products or services within the UAE, establishing a mainland company will enable you to do this. Mainland companies are allowed to trade freely across the country, as well as abroad.
For further advice and information to help you decide on the right path forward for your Dubai company and your personal and business ambitions in the UAE, please contact us.
Is it worth setting up a company in Dubai?
Establishing a Dubai company can certainly be advantageous for a wide range of foreign nationals. You might be interested in setting up a company here for the following reasons:
- The business-friendly environment within Dubai and the UAE. The Government in this part of the world seeks to encourage business development, including through a streamlined regulatory approach, plentiful business resources, and a dedication to innovation. This is a nurturing locality in which to build a successful business.
- The broad variety of market opportunities in the Emirate. There are few areas of the globe where such a wide range of different industries is so strongly represented. Whether you are interested in setting up a Dubai company with a focus on financial services, technology, tourism, hospitality, and/or something else, Dubai will offer you exciting scope to innovate and grow.
- Dubai enjoys a strategically advantageous location. The city’s position at the crossroads of Europe, Asia, and Africa makes it a powerful gateway for entrepreneurs hoping to trade across these continents. You won’t need to travel too far to connect with potential clients and partners across a range of flourishing economies.
- The attractive tax regime from both a personal and business perspective. With the UAE not imposing income tax on individuals, you will be able to keep a greater amount of funds, some of which, you may choose to invest back into your business to support its innovation and growth. Meanwhile, the corporate income tax rate here is just 9%, which compares favourably to the system in the UK and many other jurisdictions.
- The quick and easy process for setting up a company. In some countries, the procedure by which foreign nationals can set up a business may seem unnecessarily long-winded and cumbersome. This is far from the case in Dubai, particularly for those who decide to set up a free zone company. The regulations are easy to understand, support readily available, and the process efficient – so, you can look forward to soon proceeding to operate and grow your Dubai company.
Take those first steps today to establishing a Dubai company and obtaining residency
Once you have registered a company – whether in mainland Dubai or in a free zone – you will be able to apply for an entry permit for yourself and any employees of your business. You will then need to undergo a medical examination – encompassing blood tests and X-rays – and apply for an Emirates ID, which will entail fingerprinting and photography.
Finally, you will be able to submit your passport, so that it can be stamped with the residency visa. At last, you will have been officially granted residency status in Dubai, so that you can tap into the many and varied benefits of living and working in this part of the Middle East.
To learn more about the process of setting up a company in Dubai and gaining UAE residency with the help of our experts in immigration law, please enquire to the Cranbrook Legal team today. You can give us a call on 0208 215 0053.