Key steps to setup a business on the mainland
Select the business type
The first step in this process is selecting the type of business/commercial activity that you want to do. This will help you identify the options regarding the legal form of the company and the parties associated with that activity. Business types are mainly categorised into:
- Commercial (trading)
- Professional (vocational)
Company can be categorised into:
Joint liability company
A joint liability company can conduct only commercial and industrial activities.
Limited Liability Company (LLC)
Limited Liability Companies (LLCs) can conduct any industrial, commercial, professional and tourism business. Some professional business are not permitted and others require additional approvals.
Public Joint Stock Company
A public joint stock company can practice any industrial, commercial or professional business activities.
Private Joint Stock Company
A Private joint stock company can conduct only commercial and industrial activities.
Under a civil company, professional businesses in recognised fields such as medicine, law, engineering and accountancy are allowed.
Branch of a local or GCC company
A branch of a local or GCC company can conduct activities included on the main company licence.
Branch of a foreign company
A branch of a foreign company can conduct selected commercial and professional activities; same as what the head office conducts.
Branch of a free zone company
A branch of a free zone company can conduct commercial, industrial and professional businesses as long as the activity of the main company is authorised on the mainland.
A business owner can practise any industrial, commercial or professional business activities. An industrial or commercial type sole proprietorship is only permitted for UAE nationals or GCC nationals
The UAE Cabinet may also restrict some activities to be exercised exclusively by UAE nationals.
Determine the legal form of business
Choosing a legal form of the business in the UAE's mainland depends mainly on the nationality of owners and type of activity. You can set up one of the following company types:
- Joint Liability Company
- Simple Commandite Company
- Limited liability Company (LLC)
- Public Joint Stock Company (PJSC)
- Private Joint Stock Company (PrJSC)
Other types of companies:
- Sole establishment
- Civil company
- Local Company Branch
- Foreign Company Branch
- GCC Company Branch
- Free zone company branch
- Foreign companies' representative offices
For more information, refer to:
Trade name registration
A trade name distinguishes one business from another. It also reflects the nature and the form of the business.
For DED to approve the name, the trade name:
- must not violate the public morals or the public order of the country
- must be followed by the legal form of the company, for example (LLC, EST, PJSC, PrJSC)
- must not have been previously registered
- must be compatible with the required type of activity and the legal status of the company or business entity
- should not contain names of any religion, or governing authority, nor names or logos of any external bodies.
Trade names are subject to cancellation at the end of booking period. The company may change its name into another by special resolution, provided the change will not affect its rights and obligations.
Obtaining initial approval
After determining the activity and the legal form and registering the trade name, you need to obtain the initial approval certificate. It is only after seeking the initial approval that you can proceed for additional approvals of authorities other than the DEDs which is required in case of certain business/trading activities.
Note for foreign investors
Foreign investors must obtain the approval of the General Directorate of Residency and Foreigners' Affairs before getting the initial approval. The initial approval does not allow a person to practise the activity, unless a commercial licence is duly issued, as a last step of the process.
Choosing a location for your business
All businesses must have a physical address. The applicants must determine a site to conduct their businesses. The location must comply with the requirements set out by the Department of Economic Development in the respective emirate and the zoning regulations of the local municipalities.
In Dubai, you need to show a rent agreement (MoU) for the proposed location of your business and this must be registered with Ejari for attestation.
You can add a new trade licence to the same location. In Dubai, you need to consider the following:
- The local party of the new licence is the same owner, partner or LSA in the existing licence of the desired location
- The total number of licences owned by the local party does not exceed 10 licences per location
- The space of location allocated for each licence should not be less than 200 sq. ft.
Obtaining approvals of relevant authorities
Sometimes approvals of bodies other than the DEDs are required. These bodies are the entities governing respective activities. For example, businesses that:
- conduct insurance activities must obtain the approval of Ministry of Economy
- conduct transport activities must obtain the approval of Ministry of Interior
- offer legal consultancies must abstain the approval of Ministry of Justice
- sell firefighting equipment must obtain the approval of Civil Defence.
Applicants should seek the assistance of DED to know what other approvals are required. However, business activities that fall under the DED's control do not require any additional activity-specific licensing approvals.
Getting your business licence
After completing the steps above, you need to:
- submit all the documents to DED in the in the respective emirate
- finalise due payments.
Then, you can get your business licence.
You need to apply to become a member of the chamber of commerce in the emirate you operate in, before you can commence with your business activity.
Is it possible to practice an activity after obtaining the initial approval?
No, you may only proceed after receiving the licence.
Is it possible to amend the licence details after having the initial approval?
Yes, you can after getting the required approvals.
What are commercial activities?
Commercial activities are the activities that require a capital. They include wholesale and retail trade, construction, transportation, communication, financial mediation, real estate and leasing.
What are industrial activities?
Industrial activities are the activities that require a capital. They include manufacturing, mining, quarrying, electricity, gas, and water.
What are professional activities?
Professional activities are the activities that depend on mental and physical effort. They include agriculture, fishing, education, health, social work and community, social and personal services.
For more FAQs, check the following links: