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Frequently Asked Questions

1. Where do I start if I want to set up a business in the UAE?

We recommend that you create a business plan to understand your company requirements, and you will need to answer key questions that will guide you on the ideal location for the business (e.g., Free zone or Mainland, Abu Dhabi or Dubai) and the type of business structure best suited for your business. Key questions include: Will your company be trading/selling goods or providing services? Does a government authority regulate your activity or product? Who is your target market, and where are your clients based? Where will you likely be located? Do you wish to deal with government or semi-government organizations? How many staff will you require? What is your timeline? All these questions are essential to understanding how to help you.

2. What type of company entity would be suited to my business?

Categories would be required: Professional, Commercial or Industrial licenses. Depending on the type of license required, the entity type can be determined. These include; Limited Liability Company (LLC), Foreign/Local Branch, Sole Establishment, or Civil Partnership.

3. Which emirate of the UAE should I set my company up in?

There a 7 Emirates making up the UAE; Abu Dhabi, Dubai, Sharjah, Ras Al Khaimah,

Fujairah, Ajman & Umm Al Quwain. To determine which emirate is best to set up in, you

should consider the following:

- Where are your clients based?

- Are you dealing with private or government entities?

- Where do you want to live?

- What are the rental costs?

Depending on your business activities and prospective clients will go a long way to deciding which DED license is required. Deciphering what your business activities &/or prospective clients will be is extremely important to decide which emirate to set up in. For example, to obtain an ADNOC/SPC approval, an Abu Dhabi Mainland trade license is mandatory.

4. What is the difference between a Free Zone and a Mainland Company in the UAE?

Mainland Company:

A mainland establishment is an onshore setup licensed by the Department of Economic

Development (DED). An onshore establishment is permitted to conduct business in the

local market as well as outside the UAE without any restrictions.

Free Zone Company:

A Free Zone business is incorporated within a designated jurisdiction of a certain

emirate where the company is only allowed to conduct business inside the same Free

Zone or outside of the UAE. For commercial trade licenses and trading of physical

goods, the Free Zone company cannot conduct local mainland UAE business directly.

For Freezone companies to trade with the UAE mainland, they must do so through a

mainland distributor or agent and must pay a 5% import duty on local invoices. A Free

Zone business cannot work legally outside of its designated jurisdiction.

5. Can a foreigner own 100% of a company in the UAE?

There are multiple ways that a foreign party can own 100% of a business. The numerous

Free Zones throughout the Emirates allow for 100% ownership of businesses of varying

sizes and across multiple industry sectors. However, it is important to note that there

are restrictions in terms of who you may contract with when operating from a Free Zone

entity. Throughout Mainland UAE, it is possible for Foreign Nationals or Companies to own businesses that provide professional and consultancy services wholly – this can

be done as an individual through a 100% owned Establishment or as a Company as a

100% owned Foreign Branch. It is not permitted to trade goods within the UAE mainland

using a 100% Foreign-owned company.