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How to set up a company in DUBAI?

There are two main options for entrepreneurs looking to set up a company in Dubai: Mainland and Free Zone. Each model has its own advantages and processes. Below you can find detailed setup steps and key points for each model:

Mainland Company Establishment

Mainland companies can operate throughout Dubai and directly serve the local market. These companies are licensed by the Dubai Department of Economy and Tourism (DET).

1 - Determination of Business Activity:

The main field of activity that the company will perform is selected. This determines the type of license and legal structure.

2 - Selection of Legal Structure:

The legal structure appropriate to the business model is selected. Common structures include Limited Liability Companies (LLCs), Sole Proprietorships, and Partnerships.

3 - Registration of Trade Name:

The company name is registered in accordance with established rules. The name must not be similar to existing companies and must include an appropriate legal structure suffix (e.g. LLC).

4 - Initial Approval Application:

A preliminary approval is obtained from the DET stating that it has no objection to the establishment of the company. This is not necessary for the company to start its activities, but is necessary for the next steps.

5 - Articles of Association and Local Service Agency Agreement:

Depending on the legal structure chosen, Articles of Association (MoA) are prepared and notarized. For foreign investors, a local service agent may be required.

6 - Workplace Selection and Lease Agreement:

The physical address of the company is determined and the lease agreement is made. In Dubai, the lease agreement must be registered in the Ejari system.

7 - Obtaining Additional Approvals:

Some business activities may require additional government approvals (e.g., healthcare, education, financial services).

8 - Obtaining the License:

Once all the documents are completed and the fees are paid, a commercial license is obtained from DET.

9 - Chamber of Commerce Registration:

The company is registered with the Chamber of Commerce and Industry in the relevant emirate.

Advantages

  • Ability to operate directly in the local market.

  • The right to participate in government tenders.

  • Flexibility to open an office or store.

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Tax Advantages - Operating in the Local Market

Free Zone Company Establishment

Free Zones are special economic zones that specialize in specific sectors and offer various incentives to investors. There are many Free Zones in Dubai, such as:

  • Dubai Multi Commodities Center (DMCC)

  • Dubai Airport Free Zone (DAFZ)

  • Dubai Silicon Oasis

  • Jebel Ali Free Zone (JAFZA)

  • Dubai International Financial Center (DIFC)

1 - Determination of Business Activity:

Free Zones focus on specific business activities. The company's field of activity determines the Free Zone to be selected.

2 - Selection of Legal Structure:

There are generally two main structures: Free Zone Entity (FZE) and Free Zone Company (FZCO). The structure is determined by the number of partners.

3 - Registration of Trade Name:

The company name is approved by the selected Free Zone authority. The name must not be similar to existing companies and must include an appropriate legal structure suffix.

4 - License Application:

The type of license appropriate to the company's field of activity is selected and an application is made.

5 - Selection of Office Space:

Free Zones offer a variety of options, from virtual offices to physical offices. Office space is determined by license type and number of employees.

6 - Pre-Approval and Registration:

By submitting the necessary documents, preliminary approval is obtained from the Free Zone authority and company registration is completed.

7 - Lisansın Alınması:

Once all the processes are completed, a commercial license is obtained.

Avantajları

  • 100% foreign ownership.

  • Tax exemptions (e.g. corporate income tax).

  • Freedom of transfer of capital and profits.

  • Quick and simple installation processes.

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Comparison Table

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Official Sources and Platforms

Conclusion and Recommendations

Establishing a company in Dubai depends on your business model, target market and budget. If you want to operate directly in the local market, you may prefer a Mainland company. However, if you plan to do international business and want to benefit from tax advantages, Free Zone companies may be more suitable.

In both models, it is recommended that you work with an experienced consultancy firm to ensure that the processes proceed correctly and quickly. This will provide you with time and cost advantages in legal compliance, document preparation and application processes.

I would be happy to assist you with any further information or a personal consultation.

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