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SETTING UP BUSINESS
 

Prior to 9184 in the varying Emirates, inclusive of Dubai, Abu Dhabi, Sharjah, Ajman, Ras Al Khaimah, Umm Al Quwain and Fujairah, followed their own procedures governing the operations of foreign business interests. In 1984, Federal Law No.8 of 1984, and the following amendment by Federal Law No.13 of 1988 – the ‘Commercial Companies Law’ and its by-laws were issued. The law made it conditional that nationals must wholly own the companies or that nationals must own at least 51% of the share capital, while the remaining 49% may belong to foreigners. The law provides that commercial companies established in the U.A.E. must take any of the following legal forms:
 

  • Legal Structures for Business
  • Licensing

Legal Structures for Business in Dubai

The Federal Law stipulates a total local equity of not less than 51% in any commercial company and defines seven categories of business organization, which can be established in the UAE. It sets out the requirements in terms of shareholders, directors, minimum capital levels and incorporation procedures. It further lays down provisions governing conversion, merger and dissolution of companies.
 
  • General Partnership Company
  • Partnership in-commendam (Limited Partnership)
  • Public Shareholding Company (PJSC)
  • Private Shareholding Company
  • Joint Venture (Consortium Company)
  • Professional Companies (Professional Partnership)
  • Sole Proprietorship Firm to practice a profession
  • Opening a branch or representative office of the foreign company
  • Establishments by GCC Citizens
  • Appointing a Commercial Agent (Exclusive Distributor
  • Limited Liability Company (LLC)

Licensing

The basic requirement for all business activity in Dubai is one of the following three categories of licenses:

Commercial licenses covering all kinds of trading activity; Professional licenses covering professions, services, craftsmen and artisans; Industrial licenses for establishing industrial or manufacturing activity.

These licenses are all issued by the Dubai Economic Department. However, licenses for some categories of business require approval from certain ministries and other authorities: for example, banks and financial institutions from the Central Bank of the UAE; insurance companies and related agencies from the Ministry of Economy and Commerce; manufacturing from the Ministry of Finance and Industry; and pharmaceutical and medical products from the Ministry of Health.

More detailed procedures apply to businesses engaged in oil or gas production and related industries.

Practicing some trade activities (e.g. jewellery and insurance) requires the submission of a financial guarantee issued by a bank operating in Dubai. In general, all commercial and industrial businesses in Dubai should be registered with the Dubai Chamber of Commerce and Industry.

Types of Licenses 

In general, most of the free zones issue the following types of licenses:

1. Trading License

2. Industrial License

3. Service License

4. National Industrial License

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