The United Arab Emirates (UAE) is one of the world’s most appealing business locations, providing foreign investors with several advantages like tax benefits, global–standard infrastructure, and strategic market access. Setting up a company in UAE requires knowledge of the business environment, legalities, and registration procedure to make your venture a success and a smooth process.
A step-by-step guide to setup up a company in uae as a foreign investor in the UAE, covering business setup types, licensing schemes, fees, and advantages.
Why Set Up Business in UAE?
The UAE has become one of the leading business centers for entrepreneurs and international corporations. Here is the reason why foreign investors like to setup a company in uae:
1. 100% Foreign Ownership
Earlier, foreign investors required a mainland sponsor to have a mainland company. But reforms introduced recently make it possible to have 100% foreign ownership in most industries, making the UAE more conducive to business.
2. Tax-Free Environment
One of the largest benefits of having a company in the UAE is the tax advantage. The nation provides:
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0% personal income tax
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9% corporate tax (applicable only to companies with annual profits exceeding AED 375,000)
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No capital gains tax
3. Strategic Location
The UAE is a gateway between Europe, Asia, and Africa, and it is the perfect place for companies to expand globally. With world-class seaports, airports, and logistics centers, businesses can easily reach global markets.
4. Diverse Business Opportunities
From e-commerce and real estate to manufacturing and consultancy, the UAE offers a wide range of industries for foreign investors. The country is continuously diversifying its economy, making it an attractive destination for startups and multinational companies.
5. Ease of Doing Business
UAE is ranked among the highest in ease of doing business owing to its ease of registration process, digital economy, and friendly investor policies.
Steps to Setup a Company in UAE as a Foreign Investor
Setting up a company in the UAE is a multi-step process. Here is a step-by-step guide:
1: Choose a Business Structure
The initial step is to choose what type of business entity you wish to establish. The UAE has three primary options:
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Mainland Company – Best for businesses that wish to operate within the local UAE market and engage with government agencies.
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Free Zone Company – Suitable for foreign investors seeking 100% ownership, tax advantages, and easy setup.
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Offshore Company – Most suitable for companies that want to have an international presence without trading in the UAE market.
2: Choose a Business Activity
The UAE also has a list of approved business activities, and you have to select one that you can fit your business model into. The Department of Economic Development (DED) and free zone authorities oversee these activities.
3: Choose a Business Location
The location of your company depends on whether you are setting up a company in uae in the mainland, a free zone, or offshore. Free zones such as SPC Free Zone offer excellent benefits like 100% foreign ownership and tax exemptions.
4: Register Your Business Name
You need to select a trade name that is permissible under UAE law and is not taken by another organization. The name should not contain abusive words or religious/governmental references.
5: Obtain a Business License
Your business license will be based on the type of your trade. The three principal business licenses for the UAE are:
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Commercial License – For trading purposes
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Professional License – For service-based businesses
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Industrial License – For production and manufacturing companies
6: Obtain Initial Approvals & File Documents
You must file important documents, such as:
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Passport copies of shareholders
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Business plan
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Memorandum of Association (MoA)
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Lease agreement (if applicable)
7: Open a Corporate Bank Account
After your business is registered, you must open a corporate bank account with a UAE-based bank to conduct business operations effectively.
8: Obtain Visas & Office Space
You can obtain investor visas, employee visas, and dependent visas depending on the company structure. You may also lease office space or use virtual office facilities if necessary.
Cost of Setting Up a Company in the UAE
The cost of setting up a business in the UAE depends on the business nature, location, and support services needed. The major expenses are:
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Business license fees (starting from AED 5,750 in free zones)
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Visa and immigration costs
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Office space leasing (if applicable)
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Bank account opening fees
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Government approvals and document attestation fees
Note: For a more detailed cost analysis, you may utilize the SPC Free Zone Cost Calculator to project your overall investment.
Advantages of Company Formation in UAE Free Zones
If you choose a free zone, the following are some other advantages:
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Full repatriation of profits and capital
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No currency restrictions
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Quick business setup (as fast as 2 days)
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Access to coworking spaces and business support services
Why Choose SPC Free Zone for Your Business Setup?
Looking for a smooth and economical business setup in the uae? Consider the SPC Free Zone, which is situated in Sharjah. SPC Free Zone has to offer:
✔️ 100% foreign ownership
✔️ Tax exemptions and customs benefits
✔️ Affordable office and warehouse solutions
✔️ Easy licensing and visa processing
✔️ Access to world-class infrastructure
Final Thoughts
Setup a company in the uae as a foreign investor is a lucrative experience that presents a gateway to world opportunities. If you adhere to the procedures identified in this manual and utilize the advantages of the UAE’s entrepreneurial-friendly climate, you can open a profitable and successful business.
Whether you are a first-time entrepreneur or an experienced investor, the UAE offers the perfect platform to achieve your business goals. Start your journey today and take advantage of the unparalleled opportunities in this dynamic region.
Frequently Asked Questions (FAQs)
Q1. Can Foreign Investors Own 100% of Their Business in the UAE?
Ans: Yes, foreign investors are able to own 100% of their business in the UAE following recent reforms. Whereas mainland companies used to need a local sponsor with 51% ownership, the UAE now permits full foreign ownership in most sectors, especially in free zones. However, local partner or agent will still be needed for some activities, so it’s always best to verify the particular regulations for your business activity.
Q2. How long does it take to set up a company in the UAE?
Ans: The process of setting up a business takes between 2 to 10 days, depending on the type of business, location, and requirements for approval. Free zones tend to have quicker registration than mainland businesses.
3. What Are the Costs Involved in Setting Up a Company in the UAE?
Ans: The expense of company setup in the UAE is dependent on considerations such as the jurisdiction (free zone, mainland, or offshore), business activity, and size of office required. Typically, the expenses consist of:
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License fees
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Office rental or virtual office fees
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Visa processing fees
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Legal documentation and notarization fees
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Bank account opening fees