Business Setup in Mainland Dubai - Compaq Guide

by Brenda Cagara Business Consultants in Dubai

Business setup in Dubai Mainland is a very famous type of business setting. It is also very challenging to setup business in Dubai mainland especially if you are not aware of the rules and regulations and process of business. In Dubai the administrative authority of mainland business setup is Dubai Economic Development (DED), it is also responsible of issuing license for your business. Some specific nature of businesses requires additional approval from relevant government department or ministry.

Mainland Business setup process

When it comes to Mainland company formation or business setup you must know that if you want to setup company you need to take help from a UAE national as local sponsor who would hold 51% of your company and you would only hold 49% of company however you can sign agreements with local sponsor for profit sharing and administrative roles. Local sponsor mostly are silent partners who get the agreed upon profit from the business. A UAE company can also act as a local sponsor. For professional service license you are not required to have a local sponsor and you are allowed 100% ownership of your business. For professional service you however need the help of service agent who will deal with the authorities on your behalf.

There are 6 steps involve in business setup in Dubai Mainland:

Selection of Business Activity and Approval of Name
Finding Local Partner or Service Agent
Apply for Initial Approval for Mainland company setup
Preparation of Court Notarization and MOA
Office Space and Tenancy Contact
Final Submission for Mainland company formation

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Selection of Business Activity and Approval of Name:

The very first step when it comes to setup your business in Dubai mainland is to select the business activity that you are willing to start. You have options to choose from different types of business setup. Here are the types of business activity you can choose from:

Limited Liability Company
Branch office
Professional service

After choosing the type of business you are going to start you need to select the name of your business. You can go to Dubai Economic Development (DED), website to check the availabilityof name for your mainland business.

Finding Local Partner or Service Agent

Second step of your business setup in mainland is finding a local partner or service agent based on the type of business you choose. If you have chosen the limited liability or if you are foreign company willing to open a branch in Dubai you would need a UAE national or UAE owned company as sponsor. If you are a professional and willing setup business in Dubai mainland you are required to have a service agent who is going to help you setup your business. Service agent will deal with the authorities in order to setup your business. You are allowed to have the full ownership of your company and service agent will not be the partner in your business unlike in limited Liability or branch office where local sponsor will hold the majority of business which is 51%.

Apply for Initial Approval for Mainland company setup

Third step in your business setup in Dubai mainland is to apply for initial approval. After choosing the type and the name of your business setup and finding local partner and local sponsor based on your business type you then apply for initial approval. You submit you application to Dubai Economic development (DED). Initial approval is a document which certifies that Government of Dubai has no objection on your initiative of starting business and you can continue the process of business setup in mainland Dubai.

You may need following documents for initial approval:

Business license registration Form (typed up in Arabic or English)
Shareholders Passport copies
Passport copy (visa page) of the foreign partner(s)
No Objective Certificate (NOC) from sponsor of foreign partner
Emirates ID of the local member or partner

Preparation of Court Notarization and MOA

After getting initial approval next important step is to draft MOA of your company. Based on your business type you will choose to draft Local Service Agent (LSA) or Memorandum of Association (MOA) agreement with a UAE national. For commercial business activity you will choose memorandum of association (MOA) which will represent the constitution of company. Before presenting it to notary public you need to have MOA or LSA translated into Arabic by the approved legal translator.

Office Space and Tenancy Contact

After getting initial approval and approved MOA you can get the office space depending upon your business requirements. Getting office space is necessary as all businesses in Dubai need to have a physical address. Also you need tenancy contract to present with the documents required for the final approval by the Dubai Economic department (DED).

Final Submission for Mainland company formation

Last step for business setup in Dubai mainland is to apply for final approval from Dubai Economic department (DED). To apply you need following documents:

Certificate of Trade Name
Initial Approval Certificate
Registered Tenancy agreement
If applicable, Approvals and NOC’s from other government departments (Optional)
MOA/LSA depending upon business requirements

You may be asked by other documents by the authority depending upon the requirements. Based on the business type your application processing may take up to 10 days.