Starting a Business in Dubai
In order to make a well-informed decision and capitalize on your knowledge when starting a business in Dubai, you should consider:
- acquire a good knowledge of the region
- undertake extensive research into the business sector you are interested in
- have a viable business plan which includes a study of the market conditions, the competition and your forecast of the results
- be prepared to find the necessary investment from your own resources or through your bank and preferably by other means than applying locally, particularly if you’re new to the region and without a track record. A credible plan might also attract local support or possibly government support too.
The law requires that you have a local partner who holds the majority interest and can therefore control the business (as well as close it, if he feels like it). The local partner, be it a company or an individual, doesn’t need to contribute to the start-up investment or participate financially at all. As with self-employment, there are various ways that a partner can be remunerated. The local partner requirement is currently under review in some states, however, in order to encourage foreign investment.
The process is complex and financially risky, meaning that local knowledge is crucial. From the beginning you must also consult a local lawyer such as Azhari Legal Consultancy. An experienced lawyer will guide you through the registration complexities and his help will be vital in protecting your interests.
Starting a business in Dubai is encouraged by the authorities and your local partner might be enthusiastically supportive. Export and manufacturing industries are especially strongly supported by government, particularly as regards the acquisition of land on which to construct a factory. If you setup such a business in a free trade zone, of which there are several in the region, it’s granted exemptions from import and export duties, commercial taxes, building and property licence fees, land tax and restrictions on the transfer of capital invested in the zone.
An alternative to starting a new business in Dubai is to buy an established business, which is a more straightforward process, as it doesn’t involve lodging capital, obtaining sponsorship or registration; all you have to do is agree upon a price and transfer the ownership of the business.
The potential gains of starting and running your own business are great, but it isn’t for the faint-hearted. You need to remember that you aren’t a citizen of the country and when the time comes to leave and sell your interests, your partner has time on his side, while you might not.
Company Registration & Legal Obligations for New Businesses in Dubai
UAE corporate law, and in particular company structure, is similar to that in western countries in a way that a business can be run as limited liability operations, private companies or other types of concern. As discussed, setting up a business or buying an ongoing one can be complex and you must obtain local legal advice and guidance on registration formalities via experts like Azhari Legal Consultancy.
A powerful sponsor or employer is a great weapon with officialdom, and observing his skillful negotiating can be an enlightening experience. The authorities, however, are usually helpful and don’t tend to be difficult unless they have a good reason. You will find your work life in the region easier if you’re polite and patient. Smile and seek ‘advice’: requesting advice confers respect on the person asked. Note that the recruitment of foreign staff is an expensive exercise for employers, including recruitment consultant fees, legal expenses and travel costs.