GETTING A FOOTHOLD IN DUBAI

Procedures on establishing a business presence in Dubai

D ubai 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
Partnership-en-commendam
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.

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