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Let’s Talk Mainland: Requirements to Register a Company in Dubai
Starting or extending a business in Dubai has brought a massive profit for various companies. Especially establishing small companies that can operate within the UAE has proved quite lucrative for foreign investors and entrepreneurs. Forming a company in Dubai Mainland is ideal for opening a restaurant or a cleaning service with a customer base in Dubai. Dubai’s Mainland business setup contrasts with Free Zones, which allow operating outside the UAE freely but mainly does not allow business owners to run their business on the Mainland. However, before starting a business, It is of high importance to understand the ownership requirements for the permitted legal structures. Let’s look into the requirements to register a company in Dubai Mainland.
Requirements to Register a Company in Dubai Mainland
Obtaining a license in Dubai Mainland requires several documents to start processing the license.
- Initial approval from the Department of Economic Development (DED)
- Trade name registration
- Tenancy contract of registered office address
There are also external approvals from government agencies that are required depending on the business activity. Once the above requirements to register a company in Dubai are secured, one can apply for a mainland license that the DED issues and pay the required license fee.
License Options in Dubai Mainland
There are several license options available when forming a Dubai Mainland company.
To know which category your business activity belongs to, our company formation can give you clarity and guidance on the following license types and the full list of activities that can be conducted for each license category.
How Does Foreign Company Ownership Work?
While only specific legal corporate structures allowed for majority foreign ownership for Mainland enterprises, a recent decree led to changes. Foreigners can now have a full ownership stake than the previous maximum ownership stake of 49%. That means foreigners no longer have to hire a local Emirati sponsor who holds a membership stake of at least 51%. The corporation should be registered as an LLC to carry out commercial or trade activities.
If there is only one shareholder, there are more options for full foreign ownership. This is mainly because company formation for Sole Establishment/Civil Companies only requires foreigners to appoint a local service agent. However, it should be noted that a Local Service Agent (LSA) will only serve as a company representative and holds no financial rights. The local service agent only offers their services to represent the corporation’s interests in front of the Labour and Immigration ministries. The regulations state the LSA for this type of enterprise does not have any decision-making role in the company’s operations. Thus, the foreign business owner will have complete managerial control over their business entity.
In Dubai, there is also another option that allows for full foreign ownership for freelance activities. This option is opting for the Dubai Trader license, which is only available to those already residents in the United Arab Emirates. This license will not let entrepreneurs apply for any visas. In contrast to other paths for starting a business in the UAE, this option does not require renting a physical office space with Ejari because registering the business entity can be associated solely with the residential address. For this option, unlike the other formats, there is no need for appointing a local agent or sponsor. Like other enterprises, businesses can apply for a limited set of license activities for this category.
Choose UAE will help you with a seamless process in your license application in the Dubai Mainland– from company formation to business support services that will help you gain footing in setting up your company in one of the world’s most business-friendly cities.
Our company formation specialists can readily provide professional, clear, impartial, and up-to-date business setup consultancy customized to your business needs. Schedule a free consultation today.