Mainland Company Formation in Dubai
One of the first, and most important, decisions to make when starting a new business in Dubai is to decide whether to set up in a free zone or on the mainland.
Both offer huge advantages to international entrepreneurs, with some distinct differences.
While free zones offer customs tax exemption and repatriation of capital and profts, mainland setups allow businesses to trade directly with the local market in the UAE without using the services of an agent. Mainland businesses are also free to set up anywhere within the Emirates.
When setting up with the help of a company formation expert, you can start your mainland business in just a few simple steps – and be trading within days. Keep reading to find out more.
What are mainland companies?
In short, a Dubai mainland company is one which is licensed by the Dubai Department of Economic Development (DED) to operate both within and outside the UAE. In comparison, free zone businesses cannot trade with the local UAE market without the help of a local service agent.
Unlike free zone companies, mainland businesses are required to take on physical premises in most cases. A recent change in the law now allows for 100% foreign ownership, however, this must be approved by the relevant industry body.
Types of mainland companies
There are several general types of UAE mainland business – sole proprietorships, partnerships, Limited Liability Companies (LLCs), and branch offices. LLCs are the most common.
The only company type that may not be self-explanatory is the branch office. A branch office is a subsidiary of an existing company, with the same legal identity. Branches can only carry out the same activities as the parent company.
Unlike free zone companies which are self-regulated, mainland businesses must obtain several approvals before trading. These include standard approvals such as those by Dubai Municipality, Ministry of Labor, and Ministry of Interiors, as well as industry-specific bodies such as the Dubai Health Authority for those in the medical sector.
Features and benefits of a mainland company
Along with the key features mentioned above, mainland companies offer several benefits. Diversification is often easier when on the mainland as you are not tied to an industry-specific free zone.
Growth may also be slightly easier to achieve as you are free to quickly expand your presence throughout the Emirates.
Finally, as a mainland company, you are free to take on government contracts, which can prove lucrative in this part of the world.
Mainland Company Formation in Dubai is also incredibly fast and straightforward when undertaken with the assistance of an expert in the process.
Steps to register a mainland company
Once you have instructed the services of a company formation expert, it is possible to form your Dubai mainland business in just five steps.
1. Selecting your business activities
You must decide on your business activities upfront. And you must include the specifics of every activity that you intend to carry out. Failure to do so could lead to issues later.
All permitted business activities are outlined by the local Department of Economic Development (DED) or municipality. There are thousands to choose from so you are sure to find one or more that fit.
2. Choosing your company name
Next, you must choose a name for your mainland business.
When choosing a company name in the UAE, you must abide by a strict set of naming conventions.
In short, you should avoid any offensive or blasphemous language. Avoid names of well-known organisations and avoid abbreviations if naming your company after yourself – i.e. Dave Mann Consulting, rather than D Mann Consulting. You must also check that your chosen name is available to register.
3. Making your license application
One of the main reasons for deciding your activities upfront is that they will impact your choice of license. Business activities in the UAE are grouped into categories including professional, commercial, and industrial.
If you are in the commercial sector – i.e. the buying and selling of goods – then you will require a commercial license, and so on.
When making your application, you are usually only required to provide a few details and some basic documentation, including:
- Completed application form
- Passport copy of the proposed owner or owners
- Two colour passport size photos
4. Making your visa applications
As well as a trade license, you’re also required to hold a residency visa to work in the UAE. The process consists of several steps including biometric scanning, a medical and a chest x-ray.
As the holder of a UAE business license, you can also sponsor others for their visas too. This could be a spouse, parent or child, or a domestic worker such as a housekeeper.
The maximum number of visas you can apply for will depend on the size of your company, your chosen setup and, for dependant visas, your personal earnings.
5. Opening a corporate bank account
Finally, you will need a corporate bank account to trade in the UAE.
Once again, a company formation specialist can handle all applications for you, liaising with relevant authorities on your behalf.
Are you ready to start your Dubai mainland business?
Hopefully, this guide has made clear that if you’re armed with the right knowledge, setting up a mainland business in Dubai doesn’t have to be overly complex.
That being said, it does require a level of prior knowledge of the process. What’s more, it is important to note that the application process is only straightforward if your license application is complete at the time of submission and free from errors.
To help you to ensure that this is the case, it’s a good idea to work with a Dubai company formation specialist such as Business Incorporation Zone (BIZ) when establishing a new company in the UAE.
We are a team of company registration professionals who are passionate about bringing the dreams of aspiring entrepreneurs and SMEs to life.
As well as handling your license application, BIZ can also assist with the opening of corporate bank accounts and advise on the most appropriate financial institution to suit your specific needs.
We also offer visa and immigration services and can handle all government formalities, permissions, work permits and visas applications that are required to trade in the UAE.
In short, our experts can establish your company on your behalf, make your license and visa applications, and take care of all the necessary admin – leaving you free to get on with running your business.