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Key Requirements For Establishing A Business In Dubai

Setting up a business in mainland Dubai offers entrepreneurs the opportunity to tap into the bustling economic world of the emirate. However, understanding the process requires a clear understanding of the key requirements involved. From legal structures to licensing and compliance, here are the essential steps for establishing a mainland business setup Dubai.

Legal structure selection

Choosing the right legal structure is a foundational step in establishing a business in mainland Dubai. Entrepreneurs can opt for a sole proprietorship, partnership, or a corporate structure such as a Limited Liability Company (LLC). The selection depends on factors like the nature of the business, the number of partners, and the desired level of liability.

Local partner or service agent

For most business activities, having a local partner or service agent is a mandatory requirement in mainland Dubai. The local partner holds at least 51% of the shares in the business. While this partnership structure is essential for certain activities, it may not apply to businesses operating in free zones or those exempted by specific regulations.

Trade name reservation and initial approval

Choosing a unique and meaningful trade name is crucial. Entrepreneurs must submit their chosen trade name for reservation and obtain initial approval from the Department of Economic Development (DED). This step ensures that the proposed business name aligns with local regulations and is not already in use.

Memorandum of association (MOA) and local partnership agreement

Drafting a Memorandum of Association (MOA) is a legal requirement for businesses in mainland Dubai. This document outlines the company’s activities, shareholding structure, and other essential details. Additionally, if a local partner is involved, a local partnership agreement specifying the terms and conditions of the partnership is required.

Office space and tenancy contract

Having a physical office space is mandatory for mainland businesses. Entrepreneurs need to secure suitable office premises and obtain a tenancy contract. The contract should comply with local regulations and is a prerequisite for obtaining the necessary approvals to operate the business.

Trade license application

Applying for a trade license from the DED is a critical step in the establishment process. The license application involves submitting all required documents, including the MOA, tenancy contract, and other relevant paperwork. The DED reviews the application and, upon approval, issues the trade license, allowing the business to operate legally.