If you’re willing to start a business setup in Dubai, you have several opportunities. However, Investors can start three different kinds of business in Dubai:
- Onshore businesses used to work in the UAE market.
- Foreign investors usually use free zone companies to do business in Dubai’s free zones.
- In Dubai, offshore companies are assets, property, or holding companies. They allow full foreign ownership, and you can own them completely.
Foreign investors may also set up an onshore free trade zone company in Dubai. This is one of the most common companies set up in Dubai. It offers significant tax aids. However, a consultancy agent in Dubai can help you figure out what kind of legal entity you need to run a successful business.
Different Types of Onshore Companies
The Companies Law in Dubai says that onshore companies can be set up differently. For example, limited liability companies and private or public shareholding companies. Foreign companies can also set up branch offices or subsidiaries in Dubai. The branches are called “onshore companies.” All onshore companies have different ways of holding shares and requirements for share capital.
- Dubai companies with limited liability must have at least one partner from the UAE. They own at least 51% of the paid-up capital.
- Free zone businesses can be owned by 100 percent foreigners.
All types of businesses have to meet licensing requirements.
What Is an Onshore Company?
People who want to start a business setup in Dubai must choose between an onshore company and a free zone company. There are several ways in which these two things are different:
- The onshore company can do business in the UAE and outside of it. On the other hand, a free zone company can only do business within its own free zone.
- For a foreign investor to register an onshore company, they need a local partner or sponsor. In a free zone, a foreign investor can own 100% of a company.
- There are many ways to register an onshore company. But free zone companies must use the legal structures available in those economic areas.
- From the licensing perspective, both types of companies can apply for the same licenses. However, freezone companies must do certain things in the free zones where they have their registration.
Both onshore and offshore companies have their pros and cons. But the Dubai onshore company is better for large operations that can be done in and out of the country. You can set up an onshore company as a limited liability company. It is a type of legal entity that is common in every country in the world.
Foreign companies that want to do business in the UAE can also set up subsidiaries and branch offices in Dubai.
Steps To Register a Dubai-Based Company
An onshore company formation in Dubai comes under the governance of the company law. Moreover, it requires putting together some documents and filing them with the Dubai trade register. A foreign or domestic investor must draught the articles of incorporation. Afterward, they should name a local agent to complete the registration process to set up an onshore company.
When an onshore company sets up in Dubai, the following steps are a must:
- Find a place that the onshore company can use as its legal address (a virtual office is an excellent place to start)
- Write and notarize the company’s Memorandum and Articles of Association
- Open a corporate bank account where the money from the shares will go
- File the legal papers along with information about the shareholders and company directors
- According to the new VAT law, you need to get a tax number and register for taxation
- Apply for one of the licenses listed below, depending on the tasks you’re willing to do.
Suppose the company needs any other licenses or permits. In that case, they must be gotten from the right people in the industry in which the company works. The Dubai government must recognize these.
How to get a license for a Dubai onshore company
No matter what kind of onshore business needs a setup in Dubai, there are three types of licenses:
- The license to trade,
- The license to make or do business,
- The license for the job.
Those who want to do business in Dubai can have a Dubai trade license. The manufacturing or industrial license is only for those onshore companies that invest in the manufacturing industry. However, the onshore companies that offer accounting, education, and medicine can have professional licenses.
If you’re willing to start a business setup in Dubai, there are many processes to follow. However, this whole list of processes can contract if you hire a consultant for you. They have complete knowledge of dealing with the officials. Moreover, they can minimalize your span of starting the business from months to weeks.