Company Incorporation

Types of Business Entities in Dubai

Selecting the appropriate business entity structure is essential for achieving success in Dubai. Each type provides distinct advantages and limitations, tailored to specific needs and business objectives.

1. Mainland LLC (Limited Liability Company)

A Mainland LLC is the preferred choice for businesses intending to operate within the local market of Dubai and the United Arab Emirates (UAE). An LLC is a separate legal entity from its owners, who enjoy limited liability for the company’s debts and obligations. An LLC can have up to 50 shareholders, with a minimum of one shareholder being a UAE national holding a 51% stake in the company. Dubai Mainland offers:

• 100% foreign ownership
• Tax benefits
• Access to the entire UAE market
• A wider range of business activities and opportunities

2. Freezone Companies

Freezone companies are established within designated free zones in Dubai, such as IFZA, JAFZA, or DMCC. These zones provide special regulations and incentives, including 100% foreign ownership, tax exemptions, and simplified business setup procedures.

Freezone companies can be wholly owned by foreign investors without the requirement for a local partner. However, freezone companies may face restrictions when accessing certain sectors of the UAE market.

Popular free zone options in Dubai include:

• International Freezone Authority (IFZA)
• Jebel Ali Free Zone (JAFZA)
• Dubai Multi Commodities Centre (DMCC)
• Dubai Airport Free Zone (DAFZA)
• Dubai Silicon Oasis (DSO)
• Dubai Healthcare City (DHCC)
• Dubai Internet City (DIC)
• Dubai Media City (DMC)
• Dubai South (formerly Dubai World Central – DWC)
• Dubai International Financial Centre (DIFC)
• Dubai Knowledge Park (DKP)
• Dubai Production City (DPC)
• Dubai Studio City (DSC)

Step-by-Step Process to Setting up a Business in Dubai

Setting up a business in Dubai involves several steps, which can vary based on the type of business activity, ownership structure, and whether the business is located in a free zone or on the mainland.

1. Define Your Business Activity

Identify the type of business activity you plan to undertake and ensure it aligns with the regulations in Dubai.

2. Decide on a Business Entity

Select the legal structure of your business. Common options include Mainland LLC, Freezone, or Offshore. Consulting with a business setup expert in Dubai can help you make an informed decision tailored to your specific needs.

3. Register Your Business

Mainland Company:

• Reserve your trade name with the Department of Economic Development (DED).
• Submit the required documents to the DED and obtain initial approval.
• Obtain necessary approvals from relevant authorities, depending on your business type.
• Secure a location and finalize the lease agreement.
• Complete the registration process and obtain the trade license.

Free Zone Company:

• Choose a free zone based on your business activity.
• Submit the required documents to the selected free zone authority.
• Obtain initial approval and pay the necessary fees.
• Sign the lease agreement for office space in the free zone.
• Complete the registration process and obtain the trade license.

Depending on your business type, you may need additional approvals from specific government departments or regulatory bodies.

4. Apply for Visas

Apply for visas for yourself and your employees through the relevant immigration authorities, based on your business setup.

5. Open a Corporate Bank Account

After obtaining your trade license, open a corporate bank account in a local bank.

6. Comply with Labor Laws

Ensure compliance with labor laws by preparing employment contracts and managing visa requirements for your employees.