- August 17, 2015
- Posted by: Aswani
- Category: Blog
Marking its position among the top business friendly countries in the world, Dubai is turning out to be a magnet attracting business investors from all over the globe to establish their businesses in this tax free country.
As per the prevailing market trends, Dubai is one such country that offers a plethora of opportunities to business investors to step into any kind of industry and earn huge profits. The country’s ever growing tourist traffic and global conclaves organized each year are among the major factors that aid the success of businesses in Dubai.
If you too are planning to start a business in Dubai, invest two minutes of your time to understand what are the dos and don’ts of starting a company in Dubai.
Dos of Company set up in Dubai
1. Do select a UAE national as Partner/Sponsor
In order to start a business in Dubai and exploit the potential of the city, you must tie-up with a local national as a 51 per cent partner known as the local partner/local sponsor. This gives you the liberty to locate your business anywhere in the city, and understand and adhere to the local rules and regulations easily. Make sure of paying your local sponsor an annual fee which can be negotiated.
2. Do select a free-zone in case you want 100 per cent ownership
Registering a company in one of the free-zones of Dubai gives investors the liberty of owning 100 per cent stake in their company. Establishing a company in free-zone also means expeditious start up, duty free customs boundary, 25 years of lease options, warehouse facilities and many other advantages.
3. Do select a location for optimized convenience, costs and stability
Another important step while planning on establishing a business in Dubai is to look for a location that is most profitable for your business and offers convenience to your customers/clients.
In case you are planning to set up your company in free-zone then you must make the selection on the basis of distance, cost and whether it is suitable for your business model, products and trade requirements.
4. Do confirm your visa eligibility and requirements
To establish a company in Dubai, a visa permitting you and your employees to live in the country is very important. Visas are granted for almost all kinds of businesses. The bureaucracy is open for global investors to set up a company in the city. However, the number of visas granted depends on factors such as nature of your business, size of the office and the category of the employees or the investors.
Apart from this, it is essential that your local sponsor applies for your visa as the investor of the business in Dubai. Along with this, your local sponsor must also furnish a letter that specifies his/her or your personal information, the reason behind visa application and the likes before processing.
5. Do hire a business consultant
Hire a business consultant to take you through the process of establishing a business in Dubai. This is because the consultancy firms have a team of experts that plan out your investments from scratch. This includes scribbling the strategies you need to follow to smoothly set up the business, itemize potential costs, financial options, solutions to problems and so on. They also help you register your business in Dubai, complete the required legal formalities and even find local sponsors.
Don’ts of Company set up in Dubai
1. Don’t register in Free-zone without studying the available office sizes and preconditions
The free-zones of Dubai offer wide choices of offices. But the actual availability keeps changing. It is quite possible that when you go for registration in free-zones, you might not find the kind of office size as per your requirements. Also, many offices allow only 1 visa that too only for the investors and not for its employees. Therefore, it is very essential to analyze the available spaces in the free-zones and preconditions before finalizing one.
2. Don’t make plans on the bases of published information
We often refer to the information published over the internet while making the plans for business set up. But it is very essential to validate the information before finalizing your plans. This is because rules and regulations change in free-zones and in the local market from time to time. Make sure you consult a business advisory as they are updated with all the changes happening in the UAE economy and can guide you better while establishing a company.
3. Don’t choose a license category blindly
There are more than 100 types of licenses to suit different types of business models in Dubai. Do a thorough study of the licenses and choose the category that allows you to conduct your activities smoothly and expand business in future.
4. Don’t open a bank account without knowing the bank charges
It is best to confirm bank charges before hand as banks impose varying charges and if you are starting a business in Dubai, these can account to a substantial amount for a bank dependent operation.
5. Do not agree to an oral sponsorship with your local partner
While conducting a business on foreign land and with a local sponsor, it is advised to have a legal written agreement that specifies all the details such as nature of work of both the partners, profit sharing, liability and more. Do not rely on verbal understanding.
To conclude, Dubai is one of the most versatile locations in the world to bring your dream of setting a business abroad come true. Hire an expert business management consultancy and establish your company smoothly and successfully.