Getting A Foothold In Dubai
Procedures on establishing a business presence in Dubai
Dubai is known around the world for the excellent business environment it offers. Rules and regulations for conducting business from Dubai are among the most liberal and attractive in the region. International companies seeking to establish a business presence in Dubai have a host of alternatives. Besides trading, many companies prefer setting up an office in Dubai to liaise directly with customers and further expand their area of operations. Having a permanent office in Dubai can provides many advantages in the Middle East. Businessmen in the region prefer to deal with locally based companies. The are some specialised consultants that can help you to set up your office in Dubai. The buying patterns of some countries serviced through Dubai are known to be unpredictable, thereby necessitating constant monitoring of market forces. To operate a company in Dubai, one has to obtain a relevant licence. You can also contact companies in Dubai by downloading the Dubai Business Directory.
There are several categories of licences available which can be broadly classified under following categories:
- Commercial licences for trading activity;
- Professional licences covering professions, services, craftsmen and artisans;
- Industrial licences for establishing industrial or manufacturing activity.
These licences can be obtained from the Dubai Economic Department. Financial guarantees by a bank operating in Dubai may be required for some trade activities like jewellery and insurance. All commercial and industrial enterprises in Dubai must register with the Dubai Chamber of Commerce and Industry.
All UAE established companies must have fifty-one per cent participation by UAE nationals except in the following cases:
- Within the Jebel Ali Free Zone;
- Business activities which are 100% AGCC owned;
- Where wholly owned AGCC companies enter into partnership with UAE nationals;
- Where foreign companies register a branches or representative office in Dubai;
- Certain business practices where the law stipulates 100% local ownership;
- In certain professional or artisan business practices where foreign ownership is permitted. The law also defines the requirements in terms of shareholders, directors, minimum capital levels and incorporation procedures and stipulates provisions governing conversion, merger and dissolution of companies.
The seven categories of company formation defined by the law are:
- General partnership Company
- Joint venture Company
- Public shareholding Company
- Private shareholding Company
- Limited liability Company
- Share partnership Company
A limited liability company can be floated with a minimum of two and a maximum of 50 people whose liability is limited to their respective shares in the company’s capital. Limited liability companies provide a suitable structure for companies interested in developing a longterm presence in Dubai. The minimum capital requirement for floating a limited liability company is currently Dh. 300,000 (US$ 82,000), contributed in cash or in kind. While foreign equity in the company may not exceed 49%, profit and loss distribution can be specified.
Did You Know...?
LITTLE KNOWN FACTS ABOUT THE UAE
- The UAE has spent an avarage of Dhs 5 billion (US$1.36 billion) per year on domestic development since it started exporting oil in 1964.
- The UAE is the fourth largest oil producer in OPEC, led by Saudi Arabia, Iran and Venezuela.
- The UAE provides almost 25 per cent of Japan’s total oil requirements.
- The UAE has the third largest crude oil reserves in the world.
- Abu Dhabi's Khuff reservoir is rated as one of the world’s largest non-associated gas fields.
- The UAE has the third largest gas reserves in the Middle East
- Approximately 20 per cent of the world’s gas reserves are in the Arab world.
- Saudi Arabia holds more than 25 per cent of the total world oil reserves.
- Abu Dhabi National Oil Company (ADNOC) is ranked as the 20th largest oil and gas company in the world.
- The Middle East holds more 65 per cent of the total world oil reserves.
- Abu Dhabi's oil reserves at present production levels will last for approximately 130 years while Dubai’s oil reserves are estimated to last another 25 years
- The Jebel Ali port is the world’s largest man-made port.
- Khor Fakkan is the only natural deepwater port in the Middle East.
- UAE has one of the world’s highest per capita incomes in the world.
- Much of the land that makes the United Arab Emirates was formed under the sea.