Setting up a Branch of a Foreign Company

Any company wishing to set up a project in the Free Zones must first complete a simple questionnaire. From the information provided, the Jebel Ali Free Zone Authority or Department of Civil Aviation can make a first assessment of whether the company's needs can be met.After consideration of this questionnaire, the company will be provided with:
a licence application including an appendix with details of the documents required concerning the company's legal status
a proforma of information required for planning, and
a consumer request for electricity supply.
On receipt of these documents, the Free Zone authorities will consider the proposal. If provisional approval is given, the company will be asked to prepare and submit the documents called for in the appendix to the licence application.After the checking of these documents, a meeting will be called to discuss and finalise the project details. If everything is satisfactory, the Free Zone authorities will issue conditional approval for the project. Thereafter, a lease agreement and, if required, a personnel secondment agreement will be prepared by the Free Zone authorities for signature by the company.

At the time of signing, the applicant will be required to provide the insurance policies called for in the agreements and should pay the agreed rental and licence fees prior to collection of the licence.If the company wishes the Free Zone authorities to sponsor employees on its behalf, applications for entry permits may be submitted once the licence has been issued. The bank guarantee called for in the personnel secondment agreement will be required at this stage together with visa charges.If the company's project involves the erection of a structure, detailed plans must be submitted after the lease has been signed. When the plans have been agreed, a building permit will be issued.

Administrative work, such as importing equipment or engaging labour for installation of equipment, may proceed in parallel with construction work. But application for entry permits for operatives to be sponsored by the Free Zone authorities will not normally be accepted until a completion certificate for the construction has been issued.

Offshore Company Formation in Dubai and UAE

Offshore company is familiar and effective tool for development of successful business schemes. Offshore business in Dubai and Ras Al Khaimah has a lot of advantages over similar business zones in other countries. Recently, the pressure on offshore zones has increased all over the world. However, Dubai offshore companies are not under high supervision of the International Anti-money Laundering Authorities since the UAE is one of the top countries in the world with low corruption level (according to data of the Organization for Economic Cooperation and Development). A financial statement reporting  is not required. Offshore company formation in Dubai or any other Emirate of the UAE will secure your business with perfect reputation and confidentiality.

Starting offshore business in the UAE you should pay attention to the following:

• Advantages
• Restrictions
• Offshore in Ras Al Khaimah
• Offshore bank account

Dubai Offshore company formation and its advantages:

• Foreign investors/shareholders are 100% business owners
• Tax-free
• No duty fees for import/export
• No restrictions on external capital movement
• No basic nominal capital
• No annual audit report required
• High level of confidentiality
• Offshore bank account in the UAE and any other country
• Ability to buy property in the free economic zones of the UAE being non-resident

Our company can start up your offshore business in the UAE only in two working days even without your presence.

Dubai Offshore Company and its Restrictions

Having Dubai offshore company, you will be allowed to run your business only outside the UAE, however you can buy real estate and stocks of the local companies on your name on the territory of the Arab Emirates. Offshore Dubai allows you to run any legal business except financial and bank activity.
Please note that offshore company in the UAE doesn't authorize you to get residence visa. If you are interested in getting UAE residency you should consider starting up the company in one of the free zones so that you will get many same benefits as offshore company with opportunity to run your business in the UAE plus you and your family are allowed to get resident visa in the country.

Dubai Offshore Company or Offshore in Ras Al Khaimah

You can start up offshore company only in two emirates in the UAE: Dubai and Ras Al Khaimah. Dubai offshore company formation(Jebel Ali free zone) is more reasonable only if you are going to run real estate business on the territory of Dubai. However, offshore company formation in Dubai - Jebel Ali is more complicated process and usually more expansive. There are other disadvantages of this free zone, such as mandatory annual audit report and requirements to minimum number of incorporators. Most of our clients choose to register their offshore companies in Ras Al Khaimah Free Zones – RAK FTZ or RAKIA. However, talking about any offshore company in the UAE, we will use Dubai Offshore Company, since the address of our office in Dubai will be used as the legal address your offshore company.

Dubai Offshore company formation. Bank Account.

You can open bank account for Dubai offshore company in the UAE as well as in any other country in the world. UAE Bank system is secure and well-developed. You have a variety of chose from reputable local and international banks. Our consultants will help you to make the right choice and open your bank account in the UAE within one week.
If you would like to get more information about list of documents for Dubai offshore company formation or offshore in Ras Al Khaimah, please do not hesitate to contact us (send online request, call request, contacts) and we will be glad to provide you with detailed information regarding offshore company formation in Dubai or regarding bank account for Dubai offshore company and help you to open it in the UAE or any other country.

Offshore company formation in Dubai – this is what we are doing in professional way!!

Opening a bank account in Dubai (Commercial and Personal)

Opening a bank account in Dubai

If a person happens to own or is a part of an onshore or offshore company that is registered in Dubai then he can open a corporate bank account for it. An individual- resident or non-resident is also eligible for a private bank account in Dubai.

For companies that are based outside of Dubai and are in need of banking services for business transactions; opening a bank account in Dubai has never been easier. There are many websites that can tell you how to open a bank account in Dubai.

There are certain conditions that you need to fulfil to be able to hold a bank account in Dubai. The two most important ones are that the person should be able to provide the necessary documentation proof of their identity, the nature of their business and the kind of transactions that they wish to make with this bank account. These requirements vary for different UAE banking authorities. One should choose the bank that best meets your needs and offers the most convenient banking solutions for all kinds of issues. Only then shall you be able to get the best business bank account in Dubai. It is important to keep these things in mind when opening a bank account in Dubai. If you're still not sure how the whole process goes, you should check one of the many great tutorials available online that teach how to open a bank account in Dubai.

There are a large number of both local as well as foreign banks in Dubai. They offer a multitude of services. From basic banking services to specialised bank favors, you can get whatever you want provided you make the right moves.

Corporate loans, business lease, private services and many other problems and issues can be addressed by the best business bank account in Dubai in this way.

How to open a bank account in Dubai remotely?

Many people wonder how to open a bank account in Dubai without paying a personal visit to the bank. There are some websites that help clients in opening a bank account in Dubai without having to visit the bank in person. However, it is important to note that according to UAE central bank regulations, personal presence at the time of setting up a bank account is mandatory. If the person fails to fulfil this condition then they are directly violating the rules and regulations and shall be held responsible for it. The only exceptions are setting up a private bank account in Dubai in case, the bank will send his representative abroad to meet the client. Some banks can also verify identity and signature in the foreign branch of the UAE bank.

Opening a bank account in Dubai for non residents

Many people often wonder how to open a bank account in Dubai for non residents. There are varied opinions on whether it is possible to set-up a bank account in Dubai for non-residents i.e. people without VISA or not. There are many websites and online forums that discuss such details when it comes to opening a bank account in Dubai for non residents and most of them offer ambiguous and uncertain answers. It is important to clear away such doubt.

According to many online tutorials that teach how to open a bank account in Dubai for non-residents, it is possible to establish a bank account without a resident visa only if the person is present in UAE to complete the task. There are certain limitations that are imposed on opening a bank account in Dubai for non residents. No check-books shall be issued to the account holder and the option of credit card is available only if the person makes a security deposit in the account first. Apart from these two changes, bank account in Dubai for non-residents is the same as a regular bank account. So, you can say that in all other respects, opening a bank account in Dubai for non residents is just like opening a regular bank account. These details shall remove all questions that people have on how to open a bank account in Dubai without residency visa.

Check regulations for a bank account in Dubai

Bank checks are a quite common means of financial transactions in Dubai, as well as other Emirates of the country. Therefore, check-books are offered to both corporate and also private bank account holders in UAE.

One thing to note here is that check-books cannot be issued to bank accounts that are owned by non-residents. The following kinds of individuals are eligible to receive check-books:

• Persons who have resident visa of UAE and who are capable of visiting the bank in person to set up the account
• Onshore companies operating in Dubai or other parts of the UAE provided the company executive or owner has a resident VISA

It is imperative that issued bank checks not be bounced. The best business bank account in Dubai is the one that has enough money to cover for the check. Bounced checks can lead to serious consequences because UAE has strict laws to deal with fraudulent transactions.

Credit card regulations for bank accounts in Dubai

Credit cards or plastic money are a popular means of making payments in Dubai. It is common for people to make purchases using their credit cards and thus, these cards are widely accepted all over UAE.

There are certain restrictions when it comes to getting a credit card. One of them is the clause that demands that the bank account holder place sufficient money in the account as a security deposit before applying for the credit card. It is a kind of guarantee that the bearer is capable of fulfilling the credit card expense. The amount of money needed for the security deposit largely depends on the kind of credit card you are applying for along with its monthly limit.

Debit card rules are regulations for Dubai bank accounts

For individuals (residents as well as non-residents of UAE) and onshore companies operational in Dubai or any other Emirate of the country, bank accounts come with debit cards equipped with ATM facility. This allows for easier transactions, access to instant money and the ability to withdraw money anywhere whenever it is needed.

Offshore companies based in UAE or any other Emirates are not issued any debit card.

You can set your debit card limit by defining the daily/monthly transactions that you make with it. Also, it is not possible to withdraw more than the amount of money that is present in your bank account.

Rules and regulations about online and internet banking in Dubai bank accounts

Both private as well as corporate bank account holders are offered the facility of internet and online banking by most of the banks in UAE. Internet banking is especially beneficial for those who cannot visit the bank in person every time to make a simple transaction.

You can not only check your current balance in your account but can also make online transfers to other accounts very easily. Many internet banking portals allow clients to pay their utility bills, landline bill, mobile carrier service charges, house rents and other liabilities online. You can also put in requests for certain banking services online such as insurance policies, or details on leasing and loans. All these facilities and many more are available to the best business bank account in Dubai.

Business Set Up In Dubai - An Overview

We often get asked about how to set up or open a business in Dubai at our events or on the forum- here we take a closer look at how you can set up a business in Dubai- whether you are looking at a public, LLC or a Freezone option.

Business Set Up Overview

In UAE, economic activity is regulated by individual emirates as well as the Federal Government. In Dubai, the authorities have deliberately sought to create an environment which is well ordered without being unduly restrictive. As a result, Dubai offers businessmen operating conditions that are among the most liberal and attractive in the region.

There are many options open to international companies seeking to establish a business relationship with Dubai. Apart from forming a trading relationship, many companies find that there are distinct advantages in having an on-the-spot presence in order to research market prospects, make contacts, liaise with customers, and see through the details of any transactions and orders secured.Having such a presence can provide considerable business advantages in the Middle East. 

Businessmen in the region prefer to deal with someone they know and trust and personal relationships are much more important in doing business in the Arab world than they are in western Europe or America. Also, the buying patterns of some countries served by Dubai tend to be unpredictable, creating a need for first class market intelligence and information. Dubai offers foreign companies a wide choice of business options, including:

• Direct trade - selling directly to established dealers and distributors
• Commercial agency arrangements - appointee must be a UAE national or company; agreement to be registered with Ministry of Economy and Commerce
• Branch or representative office - 100% foreign ownership permitted; local agent (sponsor) must be appointed; Economic Development Department licence required
• Limited liability company - foreign ownership restricted to 49%; Economic Development Department licence required
• Special free zone investment incentives.

Licensing
The basic requirement for all business activity in Dubai is one of the following three categories of licences:

Commercial licences covering all kinds of trading activity;
Professional licences covering professions, services, craftsmen and artisans;
Industrial licences for establishing industrial or manufacturing activity.

These licences are issued by the Dubai Economic Development Department (with the exception of licences for hotels and other tourism-related businesses which are issued by the Department of Tourism and Commerce Marketing.) Also, licences for some categories of business require approval from certain ministries and other authorities: for example, banks and financial institutions from the Central Bank of the UAE; insurance companies and related agencies from the Ministry of Economy and Commerce; manufacturing from the Ministry of Finance and Industry; and pharmaceutical and medical products from the Ministry of Health. More detailed procedures apply to businesses engaged in oil or gas production and related industries.In general, all commercial and industrial businesses in Dubai should be registered with the Dubai Chamber of Commerce and Industry. 

Ownership Requirements
Fifty-one per cent participation by UAE nationals is the general requirement for all UAE established companies except:

• Where the law requires 100% local ownership
• In the Jebel Ali and Airport Free Zones
• In activities open to 100% AGCC ownership
• Where wholly owned AGCC companies enter into partnership with UAE nationals
• In respect of foreign companies registering branches or a representative office in Dubai
• In professional or artisan companies where 100% foreign ownership is permitted.

Legal structures of Business
Federal Law No. 8 of 1984, as amended by Federal Law No. 13 of 1988 - the Commercial Companies Law - and its by-laws govern the operations of foreign business. In broad terms the provisions of these regulations are as follows:The Federal Law stipulates a total local equity of not less than 51% in any commercial company and defines seven categories of business organisation which can be established in the UAE. It sets out the requirements in terms of shareholders, directors, minimum capital levels and incorporation procedures. It further lays down provisions governing conversion, merger and dissolution of companies. The seven categories of business organisation defined by the Law are:

• General partnership company
• Partnership-en-commendam
• Joint venture company
• Public shareholding company
• Private shareholding company
• Limited liability company
• Share partnership company

Partnerships
General partnership companies are limited to UAE nationals only. The Dubai government does not presently encourage the establishment of partnership-en-commendam and share partnership companies.

Joint Venture Companies
A joint venture is a contractual agreement between a foreign party and a local party licensed to engage in the desired activity. The local equity participation in the joint venture must be at least 51%, but the profit and loss distribution can be prescribed. There is no need to license the joint venture or publish the agreement. The foreign partner deals with third parties under the name of the local partner who (unless the agreement is publicised) bears all liability. In practice, joint ventures are seen as offering a suitable structure for companies working together on specific projects.

Public and Private Shareholding Companies
The Law stipulates that companies engaging in banking, insurance, or financial activities should be run as public shareholding companies. Foreign banks, insurance and financial companies, however, can establish a presence in Dubai by opening a branch or representative office.

Shareholding companies are suitable primarily for large projects or operations, since the minimum capital required is Dh. 10 million (US$ 2.725 million) for a public company, and Dh. 2 million (US$ 0.545 million) for a private shareholding company. The chairman and majority of directors must be UAE nationals and there is less flexibility of profit distribution than is permissible in the case of limited liability companies. 

Limited Liability Companies
A limited liability company can be formed by a minimum of two and a maximum of 50 persons whose liability is limited to their shares in the company's capital. Such companies are recognised as offering a suitable structure for organisations interested in developing a long term relationship in the local market.

In Dubai, the minimum capital is currently Dh. 300,000 (US$ 82,000), contributed in cash or in kind. While foreign equity in the company may not exceed 49%, profit and loss distribution can be prescribed. Responsibility for the management of a limited liability company can be vested in the foreor national partners or a third party. The following steps are required in establishing a limited liability company in Dubai.

• Select a commercial name for the company and have it approved by the Licensing Department of the Economic Development Department
• Draw up the company's Memorandum of Association and have it notarised by a Notary Public in the Dubai Court
• Seek approval from the Economic Development Department and apply for entry in the Commercial Register
• Once approval is granted, the company will be entered in the Commercial Register and have its Memorandum of Association published in the Ministry of Economy and Commerce's Bulletin. The licence will then be issued by the Economic Development Department
• The company should then be registered with the Dubai Chamber of Commerce and Industry.

Branches and Representative Offices of Foreign Companies
The Commercial Companies Law covers the formation and regulation of branches and representative offices of foreign companies in the UAE and stipulates that they may be 100% foreign owned, provided a local agent is appointed.Only UAE nationals or companies 100% owned by UAE nationals may be appointed as local agents (which should not be confused with the term commercial agent). Local agents - also often referred to as sponsors - are not involved in the operations of the company but assist in obtaining visas, labour cards, etc and are paid a lump sum and/or a percentage of profits or turnover. To establish a branch or representative office in Dubai, a foreign company should proceed as follows:

• Apply for a licence from the Ministry of Economy and Commerce, submitting an agency agreement with a UAE national or 100% UAE owned company. Before issuing the licence, the Ministry will:
• forward the application to the Economic Development Department to obtain the approval of the Dubai government;
• forward the application specifying the activity that the office or branch will be authorised to undertake in the UAE, to the Federal Foreign Companies Committee for approval;
• Once this has been done, the Ministry of Economy and Commerce will issue the required Ministerial licence specifying the activity to be practised by the foreign company;
• The branch or office should be entered in the Economic Development Department's Commercial Register, and the required licence will be issued;
• The branch or office should also be entered in the Foreign Companies Register of the Ministry of Economy and Commerce;
• Finally, the branch or office should be registered with the Dubai Chamber of Commerce and Industry.

Professional Firms
In setting up a professional firm, 100% foreign ownership, sole proprietorships or civil companies are permitted. Such firms may engage in professional or artisan activities but the number of staff members that may be employed is limited. A UAE national must be appointed as local service agent, but he has no direct involvement in the business and is paid a lump sum and/or percentage of profits or turnover. The role of the local service agent is to assist in obtaining licences, visas, labour cards, etc.

The Jebel Ali Free Zone and Dubai Airport Free Zone have been set up with the specific purpose of facilitating investment. Accordingly, the procedures for investing in the zones are relatively simple.While the free zones are designed to complement and contribute to Dubai's growth and development, their legal status is quite distinct. 

Companies operating there are treated as being offshore, or outside the UAE for legal purposes.The option of setting up in the free zones is therefore most suitable for companies intending to use Dubai as a regional manufacturing or distribution base and where most or all of their turnover is going to be outside the UAE.

Free Zone Incentives

• 100% foreign ownership
• Exemption from all import duties
• 100% repatriation of capital and profits
• Freedom from corporate taxation, as applied throughout Dubai, with the added bonus of a renewable 15 year guarantee in the free zone
• Abundant inexpensive energy
• Simple and efficient recruitment procedures ensuring the availability of a competitive skilled and experienced workforce
• A high level of administrative support from the free zone authorities.

Licenses
Companies approved for operation in Jebel Ali Free Zone or Dubai Airport Free Zone, are granted one of the following types of licences: Trading; Industrial; Service; or National Industrial. These licences are renewable annually for as long as the company holds a valid lease from either of the Free Zones.Trading licences will be granted to companies holding a valid licence issued by the Dubai Economic Development Department or an equivalent authority in the UAE, and to companies incorporated outside the UAE. In each case, the permitted activities on the Free Zone licence must conform to those on the existing licence. Trading licences are also issued to Free Zone Establishments (FZE)

Industrial licences are issued to companies incorporated outside the UAE and to Free Zone Establishments
Service licences are only granted to companies holding a valid UAE licence

National Industrial licences are issued to industrial companies registered within or outside the UAE, provided they meet the conditions of having at least 51% AGCC equity and their local production accounting for at least 40% value added. Such companies must obtain provisional approval from the UAE Ministry of Finance and Industry. A National Industrial licence grants its holder the same rights as those of national and other AGCC companies, and products exported to AGCC states will be exempted from custom duties.

If a company wishes to practise more than one of the above mentioned activities, it must obtain a separate licence for each category of activity.Companies holding a Free Zone licence are permitted to operate in the Jebel Ali or Dubai Airport Free Zones and outside the UAE. Operation within the UAE can be undertaken either by a commercial agent, representative, distributor, or the mother company licensed by the relevant UAE authority. Any company holding a Free Zone licence can itself purchase goods or services within the UAE.

Setting up a branch of a foreign company
Any company wishing to set up a project in the Free Zones must first complete a simple questionnaire. From the information provided, the Jebel Ali Free Zone Authority or Department of Civil Aviation can make a first assessment of whether the company's needs can be met.After consideration of this questionnaire, the company will be provided with:

• a licence application including an appendix with details of the documents required concerning the company's legal status
• a proforma of information required for planning, and
• a consumer request for electricity supply.

On receipt of these documents, the Free Zone authorities will consider the proposal. If provisional approval is given, the company will be asked to prepare and submit the documents called for in the appendix to the licence application.After the checking of these documents, a meeting will be called to discuss and finalise the project details. If everything is satisfactory, the Free Zone authorities will issue conditional approval for the project. Thereafter, a lease agreement and, if required, a personnel secondment agreement will be prepared by the Free Zone authorities for signature by the company.

At the time of signing, the applicant will be required to provide the insurance policies called for in the agreements and should pay the agreed rental and licence fees prior to collection of the licence.If the company wishes the Free Zone authorities to sponsor employees on its behalf, applications for entry permits may be submitted once the licence has been issued. The bank guarantee called for in the personnel secondment agreement will be required at this stage together with visa charges.If the company's project involves the erection of a structure, detailed plans must be submitted after the lease has been signed. When the plans have been agreed, a building permit will be issued. 

Administrative work, such as importing equipment or engaging labour for installation of equipment, may proceed in parallel with construction work. But application for entry permits for operatives to be sponsored by the Free Zone authorities will not normally be accepted until a completion certificate for the construction has been issued.

Setting up a free zone Establishment
A Free Zone Establishment - or FZE - is an establishment formed and registered within the Free Zones and regulated solely by the Free Zone authorities.Such establishments must have a capital of at least Dh.1 million and liability will be limited to the amount of paid-up capital. A FZE need only have a single shareholder and is an independent legal entity.Any company, organisation or individual wishing to form a Free Zone Establishment must submit a completed application to the Free Zone authorities. A decision on whether permission has been granted will be given within 30 days of receipt of the application and any other information and documentation required.If permission is granted, the authorities will record all relevant details in the FZE Register and issue a Certificate of Formation. This will specify the date of registration after which the FZE will be free to conduct any such business as is permitted in its licence.

Key Free Zones in Dubai
Dubai Airport Free Zone
Dubai Auto Zone
Dubai Biotechnology & Research Park
Dubai Flower Centre
Dubai Gold and Diamond Park
Dubai Healthcare City
Dubai International Financial Centre
Dubai Internet City
Dubai Knowledge Village
Dubai Logistics City
Dubai Maritime City
Dubai Media City
Dubai Multi Commodity Centre
Dubai Outsource Zone
Dubai Silicon Oasis
Dubai Studio City
Dubai Sports City 
Enpark 
International Humanitarian City
International Media Production Zone
Jebel Ali Free Zone
Techno Park
JLT Free Zone

Why Choose Dubai?

The tax-free income, sophisticated business technological infrastructure, international outreach and the opportunity to establish offshore companies are synonymous with Dubai. While the global economic crisis did effect Dubai in the past year or so, investors will be glad to know that Dubai is already on its recovery path. Trading companies are flourishing and the services industry is back on track, despite the fall in the real estate and construction sectors.

Dubai business licenses are available for both mainland and freezone, but the licensing criteria varies according to the type of company been setup and the range of activities undertaken by that company.

Dubai (mainland) licenses are issued for the following activity types:

Commercial Trading
Service Providers and Professional Consultancies
Tourism and Travel Agencies
Manufacturing and Processing
Branch and Regional Offices

Dubai Market Potential

Dubai is the Middle East's trading hub and the meeting point for the Far Eastern and Western commercial worlds. While the oil sector gained quite a reputation for United Arab Emirates in general, Dubai depended more on its non-oil commercial industries, such as imports and exports.

Among the main features of Dubai's market are:

Noticeable High Revenue – over US$17 billion domestic imports take place every year
Continued Growth – the imports market has reached beyond expectations by doubling in amount since 1989
Wealthy – Dubai is strategically located in the centre of the world's wealthiest region
Diverse – a wide variety of trade, services and manufacturing industries ensure prosperity through diversification
Easy Access – served by nearly 200 shipping lines and 100 international and regional airlines
Freedom – no trade barriers, quotas or exchange controls

Dubai Business Environment

Internationally standardized, highly efficient, excellent service quality and advanced infrastructure welcome the entrepreneur in Dubai. As one of the most developed and modern states in the world, Dubai offers a large number of benefits for those who wish to setup their business in Dubai.

The key advantages are:

Free enterprise system
Latest telecommunications infrastructure
Modern public transportation and roads system
High-end financial and services sectors
Prime residential property and office premises
Affordable and reliable utilities such as gas, water and electricity
Internationally acclaimed education, health and government services
Urbanized living conditions

Costs in Dubai

A Dubai business setup has several advantages from a cost factor viewpoint. Most benefits are correlated to the type of business been setup, but in general, there are some guaranteed advantages, including:

No income taxes
No corporate taxes
No trade barriers
No foreign exchange controls
Competitive energy costs
Competitive real estate costs
Competitive labour costs
Competitive import duties (4% with several exemptions)

Doing Business in Dubai Free Zones

Special incentives are available for free zone business setups, including the following.

100% foreign ownership and control
Renewable 15-year guarantee of no taxation
No customs duties
Flexible investment options
Efficient transport and distribution facilities
Full administrative and recruitment support

Small Business Owners: Why We Recommend A Dubai Economic Department License For You

1) You need share capital (RAK FZ: minimum AED 100,000/- and JAFZA: minimum AED 500,000/-) for a free zone business. No capital is required for a Dubai mainland (DED) license.
2) A free zone license is strictly associated with free zone office space (you have to rent it), but Dubai mainland businesses can be run from a business centre with cheaper rent and all-inclusive services (special provisions are available)
3) Free zone business license and visa costs are cheaper, but it restricts you to work within free zones and international regions only - with a Dubai mainland (DED) license, you can have clients from anywhere in UAE as well as internationally
4) The long-term free zone benefits and services are more appropriate for a large international company than a small business owner.

In both types of companies, there are no income taxes and if you're thinking of starting a professional practice, you own the company 100%, regardless of whether it's in free zone or mainland Dubai

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.