For individuals with a business mindset, Dubai is a great place to do business as well as the establishment of a business in Dubai mainland has become a viable alternative for local and foreign entrepreneurs. If you are contemplating business setup in Dubai mainland, it is important to learn the process and the requirements. This article is designed to provide valuable information about how to do business in the United Arab Emirates, and above all, to explain what are the requirements for and what is included in the legal procedures that one has to follow to form a company in Dubai.

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Why Choose Dubai Mainland for Your Business Setup?

The UAE envisions Dubai mainland as a nurturing ground in terms of business opportunities without limits to the geographic scope of operations. Whereas free zones are meant to keep a business within given geographical areas, a mainland business does not have such restrictions in Dubai and even to other Emirates, thus enabling one to tap into a larger market.

There is also the aspect of choosing where to set up an office or the scope of business activities related to setting up a mainland company. For instance, the corporations that are

set up in the commercial central area of dubai are permitted to book government jobs which is an advantage because most such activities are normally not allowed in overseas business.

Key Benefits of Setting Up a Company in Dubai Mainland

The registration of a new company on the Dubai mainland has several advantages, some of which are highlighted below:

Free Reign In Business Activities: Unlike free zones, a mainland company can operate anywhere in the UAE with no limitations on the type of business that can be conducted or the location of such business.
Participation in Government Tenders: Companies registered on the mainland do not have such restrictions when it comes to engaging the government’s business for their projects, unlike those in the free zone.
No restrictions on Foreign Ownership Investment: New developments provide for foreign participation in defined business activities in their entire ownership. Thus historically, a local Emirati partner who held majority shares (51% of the business) was always a necessity, new measures have amended some of these provisions in particular industries leading to fully owned foreign enterprises.
Freedom in Choosing an Exclusive Office Space: Businesses based in the mainland can set up offices at any location in Dubai thereby offering more room for businesses as opposed to free zones.
Employee’s Visa Limit: A mainland firm can support a maximum number of employees’ visas than a free zone company.

Types of Licenses for Mainland Company Setup in Dubai

To start the procedure of registering a company in the Dubai mainland zone, it is essential first to evaluate the kind of business license which would best fit your business activity. There are three main types of licenses:

Commercial License: Suitable for companies engaged in trading activities such as retailing, export/import, and general trading.
Industrial License: Fitting to production and industries. This license is issued to those businesses who are into processing and making any goods.
Professional License: This is also known as a Practice License and is linked to businesses providing services such as consulting, teaching, and medical care, etc.

Step-by-Step Guide to Company Formation in Dubai Mainland

In order to make your understanding of the business setup in Dubai mainland process easier, we have compiled a step by step guide.

Step 1: Determine Your Business Activity

As a businessperson wanting to do business in Dubai, the first thing you should do is conduct a business activity that may require a specific type of licensing. The Department of Economic Development of Dubai has provided a list of activities which can be practiced in Dubai.

Step 2: Select a Business Structure

Whether it is an LLC, branch office, or different type of ownership – select the appropriate legal title structure for your business category and ownership preference.

Step 3: Reserve Your Trade Name

Choose and register a trade name, which is pertinent to your business. DED will want to approve the name and it will be checked against UAE name regulations.

Step 4: Obtain Initial Approval

Before you can set up your mainland company in Dubai, you will have to obtain initial approval from the DED. This approval ensures no government objection exists in regards to your business.

Step 5: Draft and Notarize the Memorandum of Association (MOA)

In the case of LLCs and few other structures, an MOA has to be prepared and executed along with a notary. The MOA explains the share of ownership and the functions within the company.

Step 6: Secure a Physical Office Space

Every business operating in the Dubai mainland must have a geographical physical office. The geographical office can vary in size and location depending on the type of business and its activity.

Step 7: Apply for Relevant Licenses and Approvals

Apply for the business license through DED. Depending on your business activities, especially those that require a higher level of scrutiny like health care and finance, additional approvals may be sought.

Step 8: Finalize Company Registration and Visa Processing

After you are issued a trade license, you may move on with a visa application for the company’s directorships and management.

Cost Considerations for Mainland Company Formation in Dubai

The cost of new company formation in Dubai varies depending on factors like office location, company structure, and number of employees. Some expenses to keep in mind include:

Trade license fees (annual fees)
Office lease costs
Notarization and legal fees
Visa processing fees
Other regulatory fees as required by DED or other authorities

Working with a business setup service provider can help streamline the process, offering valuable guidance on cost-effective solutions while ensuring compliance with all regulations.

Dubai Company Formation and Registration: Legal Requirements and Compliance

There are other regulatory compliances which Dubai mainland companies are required to adhere to, such as:

Annual Renewals: The business licenses of Mainland Companies must be renewed every year.
Bookkeeping and Financial Audits: Where applicable, maintaining a true and fair view of financial records and placing an external auditor annually which is mostly obligatory, when dealing with bigger business firms is imperative.
Local Sponsorship (if applicable): In cases where a company demands local sponsorship, monitoring the status of the contracts with other partners and the payments made by the local sponsor is very vital.

It is possible to ease these regulatory burdens through employing a professional company formation service, thereby ensuring that your business gives respect to the laws that govern Dubai.