Creating a successful company in the UAE (United Arab Emirates) can be just as difficult as creating a company in any other place in the world. Opening a company in the UAE can prove to have many advantages and benefits which makes understand the registration process of a company there all the more important. Although many people automatically refer to Dubai when the UAE is brought to mind, there are actually seven emirates in the UAE: Dubai is only one. Each emirate can have different registration procedures; however, the general idea behind the different registration procedures generally remains the same throughout all seven emirates. These five steps can be used as a guide to general company registration in the UAE.
Step One: Research
Before beginning anything in the registration process, research is essential. Because there are the seven emirates, there will be different processes and procedures. Also, there are different types of companies and specific terminology to go along with such companies and areas. By researching, an investor or would-be businessman would be able to fully understand the situation and circumstances of available options in the UAE.
There are 3 main types of companies in the UAE: offshore, onshore, and free zone. Understanding the stark differences between the three will better equip an individual to follow the next four steps. For instance, in a free zone, the company can be owned 100% by the individual starting the company. There doesn’t have to be a local sponsor or investor. The individual is essentially free to work as he or she pleases. In an onshore and offshore company, however, a local investor may be needed to manage the company. All in all, researching the area and becoming aware of the opportunities available will ensure success in the long run.
Step Two: Create a business plan
Creating a business plan is universally a good business practice. By creating a business plan, you will be able to explicitly set out the plans you have in the creating the business. This will definitely aid in the success of the company.
In the business plan, you should start with the name of the company. The name of the company will be the backbone which holds the entire company together. Without a name, what is a company, really? Also, be sure to include the appropriate suffix to the company. Whether it is an LLC or a LLD, make sure the type of company you have suits the suffix affixed to the company name. You should have discovered which one is appropriate in the research process.
Also in this plan, you should specifically set out the scope of services to be offered by the company. This will ensure that you have the right type of company suffix as well as the right type of license required. Licenses are generally disbursed due in accordance with the type of company.
Lastly, the plan should detail employment positions and opportunities, specifically shareholders, directors and secretaries. In the research process, you should have discovered the amount of employees and types of positions allowed in your specific company type and area. Generally, a company will have a shareholder, a director and a secretary. These persons can be a corporation or an individual; however, either must be have legal document on file (such as address and contact information) and the individual must have visited the UAE in the past 6 months and must prove this via passport stamp. Specific regulations such as this one can be found out by researching the type of company you seek to register.
Step Three: Licenseing and Sponsorship
In some types of companies and in some regions, a specific license is required in order to register the company. Also, in some types of companies and in some regions, a local sponsor or investor is needed to manage the company. Specifics can be discovered by researching the type of company you seek to register.
Step Four: Open a Bank Account
In most instances, it is a good idea to open a bank account at a local bank. Even if opening a bank account is not required and even if there is no minimum capital required for the company, opening a bank account is generally a good idea. For one, it allows you to build relations with the bank and to possibly develop a customer base. This task can be very difficult for some people because many people who open businesses in the UAE are not familiar with the local bank customs and procedures. It is very important to familiarize yourself with the local banks in order to allow a smooth transition in establishing the business.
Also, in opening a bank account, you should determine the type of currency your business will use and accept. Some banks allow for multiple currencies on a single account. This can be discovered when you research and when you begin to familiarize yourself with the bank’s customs.
Step Five: Legalize the Company
To finalize the process, you will need to legalize the company. In this step you will need to find, prepare and file all necessary legal documents with the appropriate government authorities. This step could also include registering any native or foreign employees with appropriate government entities. In doing this, you are ensuring that your company is legitimate and up to par with all standards set forth by the government.
After doing this, the amount of time to actual finalize registration of your company varies. It may take anywhere from 24 to 48 hours to several weeks. The amount of time it takes is by no means definitive. Some individuals choose to hire specialists to complete this process for them: this may or may not decrease the amount of time it takes. In any case, by following these steps, you can effectively register your company in the UAE.