What are the best types of companies to establish in Dubai? Dubai is one of the most attractive economic destinations for investment in the world, due to its flexible and supportive business environment and advanced infrastructure. When considering establishing a company in Dubai, entrepreneurs must choose the type of company that suits their business activity and future goals. There are several best types of companies to establish in Dubai, including limited liability companies, sole proprietorships, and public and private joint stock companies. The Limited Liability Company (LLC) type is one of the most popular types among investors, due to the flexibility it provides in management and ownership rights, in addition to protecting the personal liability of partners. Choosing the appropriate type of company depends on several factors, including the size of the business, the number of partners, and the requirements of the local and global market.
What are the best types of companies to establish in Dubai
There are many types of companies that can be established in Dubai, and each type has its own advantages that suit the needs of investors. Here are some of the most common types:
Limited Liability Company (LLC): A limited liability company is one of the most common types in Dubai. It provides protection for the personal assets of shareholders, and they bear only limited liability to the extent of their capital contributions. Foreign investors can own up to 100% of the company in most free zones in Dubai.
Sole Proprietorship: If you want to establish a completely personal project, a sole proprietorship is a good option. It gives you full control over the company, but you bear full personal liability for obligations.
Free Zone Company: Establishing a company in one of the free zones is an ideal option for foreign investors who want full ownership of the company without the need for a local partner. These areas offer tax exemptions and attractive incentives.
Private Joint Stock Company: Suitable for large companies seeking investments from a limited number of shareholders. It provides flexibility in raising capital, but requires more complex legal and regulatory procedures.
Branch of a Foreign Company: Foreign companies can open a branch in Dubai. This type of company allows you to operate under the same foreign brand name and benefit from the advanced infrastructure in the emirate. Each type of company depends on your business needs, the size of your investments, and the nature of the target market.
The importance of establishing companies in Dubai
Establishing companies in Dubai is one of the most important investment decisions that entrepreneurs can make, given the great economic opportunities offered by the emirate. Dubai is considered a global financial and commercial center, as it enjoys a strategic geographical location linking the markets of the Middle East, Asia, Africa and Europe, making it an attractive point for global and regional companies.
Dubai provides a favorable business environment through flexible economic policies and legislation that supports freedom of foreign investment. In addition, free zones in Dubai offer many incentives, such as full ownership for foreign investors, tax exemptions on income and profits, and ease of transferring profits abroad. Dubai also features an advanced infrastructure that includes global ports, airports and modern roads, which facilitates the movement of trade and logistics services.
On the other hand, Dubai provides a stable legal and legislative environment that protects the rights of investors and companies, in addition to smooth procedures for establishing companies and obtaining licenses. The diversity of Dubai’s economic sectors, such as real estate, trade, tourism, and finance, provides investors with multiple opportunities for growth and expansion. Thanks to these factors, Dubai has become an ideal destination for establishing companies and achieving success in regional and global markets, which enhances its position as a leading investment destination.
Conditions for establishing companies in Dubai
Establishing companies in Dubai requires adherence to a set of conditions and procedures that ensure compliance with local laws and provide a reliable business environment. These conditions vary depending on the type of company and the area in which it is established, whether within Dubai itself or in the free zones in Dubai. Here are the most important general conditions for establishing companies in Dubai:
Choosing a business activity: You must determine the type of business activity you wish to engage in. There is a list of multiple business activities from which you must choose the appropriate activity based on your investment plans.
Determining the legal structure: You must choose the appropriate legal structure for your company, such as a limited liability company (LLC), a sole proprietorship, a branch of a foreign company, or a private or public joint stock company.
Obtaining government approvals: Some business activities require additional approvals from specific government agencies, such as regulatory authorities or ministries.
Finding a local partner: In some business activities established outside the free zones, there must be a local partner who holds 51% of the company’s shares. However, free zones allow foreign investors to own the company 100%.
Commercial Registration: The company must be registered with the Department of Economic Development (DED) if it is located within Dubai, or with the competent authority in the free zone.
Prepare the necessary documents: You must submit the necessary documents such as the Memorandum of Association, the company’s articles of association, copies of the partners’ passports, and licenses from the competent authorities.
Obtain a commercial license: After fulfilling the requirements, a commercial license can be obtained to practice commercial activity legally in Dubai.
By following these steps, the company can be established in an easy way, taking into account local laws and the requirements specific to each type of company.
Factors in the cost of establishing a company in Dubai
The cost of establishing a company in Dubai varies based on several main factors, the most prominent of which are:
Type of company: The cost of establishing a company depends largely on its type. Limited liability companies (LLCs) may require higher costs compared to sole proprietorships or companies in free zones.
Location: The cost of establishing a company varies depending on its location. Establishing companies in free zones can generally be less expensive, as these areas provide tax exemptions and investment incentives. In contrast, establishing a company within Dubai may require additional fees.
Trade license: Trade license fees vary depending on the type of business activity. Some activities require higher fees than others, so investors should study the cost of the license according to their activity.
Documents and legal costs: The establishment process requires the preparation of legal documents and contracts, and you may need to consult a lawyer or legal services company, which increases costs.
Rents and utilities: If you need office space, you must calculate the costs of rent and utilities. Rental prices in Dubai vary greatly depending on location and size.
Additional service costs: Such as opening a bank account, additional licenses, and insurance. These costs can significantly impact the overall cost of establishing a company.
Number of partners: Some companies may require a certain number of partners or employees, which increases costs, whether in terms of salaries or commissions.
Taxes and fees: Although Dubai does not impose personal or corporate income taxes on most activities, any local fees or taxes that may apply should be taken into account.
It is important for investors to conduct a comprehensive study of all these factors to accurately estimate the cost of establishing their company, which helps in sound financial planning and achieving success in their business.
Itqan Company’s services in choosing the best types of companies to establish in Dubai
Itqan Company provides a variety of services that make it easier for investors to choose the best types of companies to establish in Dubai. Among these services are:
Specialized legal consultations: Itqan Company provides in-depth legal consultations on the different types of companies available in Dubai, helping clients understand the options that suit their needs and requirements.
Business activity analysis: The company analyzes the business activity that the investor wants to practice, which makes it easier to determine the most appropriate legal structure, whether it is a limited liability company, a sole proprietorship, or a branch of a foreign company.
Market Research: Itqan provides comprehensive market studies that help investors understand the competition and opportunities available in the market, enabling them to make informed decisions about the type of company to establish.
Establishment Procedures: Itqan assists in all stages of establishing a company, starting from preparing the required documents, registering with government departments, and obtaining a commercial license.
Providing Legal and Financial Support: The company provides legal and financial support to ensure full compliance with all legal and financial requirements, facilitating the establishment process.
Guidance on Free Zones: Itqan provides advice on the best free zones in Dubai that suit the type of business activity, allowing investors to benefit from available incentives.
Providing Information on Local Partners: If the activity requires a local partner, Itqan provides information on how to find a reliable and supportive partner.
Guidance on Taxes and Costs: The company helps investors understand the costs associated with establishing a company, including potential fees and taxes, facilitating financial planning.
Through these services, Itqan helps investors make decisions based on accurate data and reliable guidance, enhancing their chances of success in the UAE market.
