Over the years, the UAE has become a central figure of business opportunities in the GCC, and the world. This is due to the country’s venture-friendly policies that enable businesses to thrive and encourage investors to invest in the multitude of industries that exist within the Emirates. The introduction of foreign investment and international businesses into the economy has made the market thrive, all while keeping investors and entrepreneurs satisfied with simple and easy to understand procedures and regulations. Starting an international business in the UAE is a lucrative opportunity for potential investors to expand their reach from outside the borders of the UAE. This article delves into the various steps involved in starting your own international business setup in the UAE.
1. Select your business activity and trade name
The very first step is to choose what economic activity you would like to engage in for your newly formed business setup. You can select the business activity of your choice from the list of activities provided by the Department of Economic Development (DED). After this, you will need to select a trade name for your venture. Ensure that the name you select is in line with the guidelines and protocols for trade names provided by the DED. You will need to submit at least 3 naming options for your business in your application to the DED.
2. Select the ownership structure, legal form, and location of your business
Depending on the location of your business as well as the type of business you would like to engage in, there are varying rules that can affect the overall constitution of your firm. The various types of ownership structures include Limited Liability Company, Sole Proprietorship, Civil or Professional Company, and Free Zone Company. Additionally, you can choose to set up your venture either on the mainland or in a free zone. If you choose to set up your company within a free zone like SPC Free Zone, you can enjoy benefits that allow for 100% ownership to the shareholder without the need for a local agent, or “sponsor”.
3. Preparation of Documentation and Legal Paperwork
For the business to be successfully established, it is important that all necessary paperwork and legalities be completed so that the company is in compliance with the rules and regulations associated with starting and operating a business. A Memorandum of Association (MOA) or Local Service Agent (LSA) Agreement is a document required for the successful registration and operation of the venture. The partner(s) and the local sponsor (if present) must prepare the document and sign it before sending it to the DED along with the other paperwork for approval. Some other documents include:
- Trade license
- Various forms associated with the application
- Passport and visa copies
4. Application for initial approval and additional approvals
The initial approval is an important approval to attain, as it signifies that the UAE government does not object to your company’s formation and that all documents submitted along with the application are valid. Once you receive the initial approval from the DED, you can proceed with other formalities required to begin a business. Additional approvals may be taken if required, depending on the line of business you intend to engage in.
5. Payment and share capital
If your application is successful, you will be issued a payment voucher by the DED. After paying the amount specified on the voucher, your application is officially approved, and you can begin business operations accordingly. Additionally, it’s important to note that a minimum paid-up share capital is often required to start a business. This capital can start from AED 10,000 onwards. SPC Free Zone allows AED 0 paid-up capital for companies set up within the free zone.
International company formation can be a challenging process for those unfamiliar with the country and its rules. Our experts here at SPC Free Zone can help you in your business journey, making sure that all your needs and queries are addressed and that the process of starting your business is smooth. Contact us at 800 SPCFZ to begin your consultation today.