Dubai tops the list when it comes to setting up your small business or investing in one in a Middle Eastern city that is exploding with opportunities. The state of the art infrastructure supports the growth of small businesses and establishing of other multi-national corporations. Foreign investment proves as a major boost to the economy of Dubai therefore, business opportunities are not only open for the locals but also to many foreign investors.
You might think that setting up a private company, no matter how small, is difficult in a fast paced life of Dubai. That, in fact, is not true. On the contrary, the progressive thinking, simplified business incentives and modern policies put forward by the government of UAE encourages investors from around the globe to invest in the oil-rich country.
This article is going to provide new and experienced investor sequential guidance on how to start a small business in Dubai.
How to start a small business in Dubai: Know What You Want to Establish
If you have sufficient know-how on how to start a small business in Dubai and about the region you are establishing your business in, it can prove to be a great success. Being an entrepreneur, you should know the viability and demand for your product or service in the city and whether or not investors would want to invest in your company.
Do not hold back on marketing your services & products. Spending some extra money on the right kind of advertisement is sure to gain you enough profit in the future. Build people’s interest by using contemporary means such as online advertisements via Google, Twitter or Facebook. You’ll know what people think and want from you.
Join Hands with a Local Partner
If you’re operating a business outside the UAE’s free-zone, then you require a local partner to hold interest in your company. This would allow the legal partner a certain percentage of control even though they are not required to contribute financially to the company. It is advised to set expectations with your partner beforehand misconceptions.
The financial magazines, on how to start a small business in Dubai, suggest that you need to register your business as soon as the start-up process begins. Once it is legalised on formal papers, the Ministry of Commerce will require you to show proof of all financial investments. If you’re not a local and in fact new to Dubai, then you must provide details of reliable financial resources through your bank or by means such as help from the locals.
Launching Limited Liability Companies (LLC)
The Limited Liability Company is the most adopted structure on how to start a small business in Dubai. The LLC’s usually formed with few or as many as 50 persons who liable only for their share investment in the company. A local sponsor holds 51% interest while the foreign equity is around 49%. You are required to store the amount of AED 300,000 in order to establish an LLC.
In order to launch an LLC there are certain steps that need to be followed:
Firstly, you need to select a relevant name for your company that resonates with the services you’ll provide to the public. It will need to be approved by the Licensing Department of the Economic Development Department in Dubai.
Secondly, you need to issue a document which will govern the activities of the company. It’ll be issued by the Dubai court.
Thirdly, after getting the approval from the Economic Development Department will issue you a license in your company’s name and will be added to the country’s Commercial Register.
The fourth and final step will be to register the company name with the Dubai Chamber of Commerce.
If you are deciding to start-up a professional firm that engages in professional activities then the government will grant you full proprietorship for your role. However, the staff employed will be limited. Help from a local UAE service agent is necessary for you to hire employees and arrange for their visas and labour cards. That agent will however have no direct involvement in your business.
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