Compulsory Requirements for Business Setup in Dubai

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Compulsory Requirements for Business Setup in Dubai

In Dubai, it's compulsory to have a local sponsor (UAE national) involved when setting up a new business. A trading company must have legal documents to show that 51% of the shares is owned by a local. An expatriate may only own the remaining 49%. However, through a Memorandum of Understanding, these terms can be adjusted to suit the investor's purposes.

In the case of a professional practice, a local service agent is required, but this agent has no involvement in the company's business operations, management or profit sharing. The agent will merely be a figurehead representative when drafting legal agreements and establishing other business documentation required in Dubai.

An office address that can be verified by the Dubai Municipality is also a necessity when setting up a new business in Dubai. Office space requirements are varied based on the type of license and it's the investor's responsibility to ensure a valid tenancy contract for an office is available at the time of applying for the license.

However, these regulations do not apply to free zone company formations. Dubai free zone companies are 100% owned by the investors/partners and are established withing a few days through the relevant free zone authority. Dubai free zones offer sophisticated infrastructure, all facilities and residency visas for investors.

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