Located on the southeast coast of Persian Gulf, Dubai is the most populous city in the UAE. It’s an ambitious city that has constantly reinvented itself to provide the best living environment for its citizens. Known for its extravagant hotels and glitzy shopping malls, Dubai is way ahead of most other cities in the world. Counted among the biggest business destinations in the world, Dubai is home to a large number of companies.
What Makes Dubai an Attractive Business Destination ?
For starters, Dubai enjoys a strategic location. It is the perfect gateway between the eastern and the western countries. The advantageous location of Dubai has helped it flourish economically. It also has world-class infrastructure that makes it easier for companies to do business. There are plenty of good hotels, restaurants and meeting venues.
The government is pro-business and provides free zones where the businesses can enjoy several benefits. It is also counted among one of the safest cities in the world. A growing economy, investment support and quality lifestyle are some of the other factors that have contributed to the growing popularity of Dubai as a major business destination.
The Concept of Free Zone and Offshore Companies
A free zone is a special economic zone established with the purpose of providing the best business opportunities to companies. The companies located in a free zone enjoy a number of business advantages including 100% ownership and no tax. There are over 20 free zones in Dubai.
An offshore company is a company located in a free zone. Offshore companies also enjoy the advantages of the free zone. However, they are different from other free zone companies as they are not allowed to carry out business activities within Dubai. Offshore companies can carry out business only outside the UAE.
How to set up a Business in Dubai ?
If you’re planning to register a business in Dubai, here are three important things that you should know-
1. Local Sponsor
To establish a business in Dubai, you need to find a local sponsor. The law makes it mandatory for every new business desirous of carrying out business activities in UAE to have a local sponsor. The local sponsor will hold at least 51% shares of the company.
The only way to register business in Dubai without a local sponsor is to establish a free zone company. In a free zone, the owners can enjoy 100% ownership of a business and there is no need for a local sponsor.
2. Business Structure
Keeping its business activities in mind, a company needs to choose the right business structure. In Dubai, there are different types of legal structures of business organizations. These include General Partnership Company, Limited Partnership Company, Joint Venture, Public Joint Stock Company, Private Joint Stock Company, and Limited Liability Company.
3. Business Registration
The process of business registration in Dubai can be very hectic and time-consuming. From getting the name approved to finding a physical space for office, from preparing a Memorandum of Association (MOA) to getting all the licenses from the concerned authorities, there are many important things that have to be taken care of. Moreover, you need to gather local information and do a lot of research.
Most new businesses are ill-equipped to handle everything themselves. For this reason, it is considered best to avail the services of a reliable business registration consultancy. These consultancies have local knowledge and are equipped with the resources required to make it easier for companies to register a business in Dubai.