Signature one stope Business Facilitation Centre: Virtual Offices, Serviced Offices, Trade Licenses, Joint Ventures

There are two licensing options for opening a business in the United Arab Emirates, "offshore" being a Free Zone entity, and “onshore” being everyone else outside the free zones in mainland UAE. Both have their own attractions, but both also have drawbacks if you do not choose correctly.

Originally there was only one option, a trade license under local sponsorship. You had to have a local partner as the majority shareholder of your business to trade within the country. However today many local partners provide the option to retain 100% control.

Since the approval of laws in the 1980’s the UAE has seen a massive growth in Free Zones and FTZ licenses. The main attraction is 100% foreign ownership of each license; however the FTZ license has its own drawback that you cannot trade in the UAE outside of the Zone you have been licensed in.

As an individual or an entity your first steps to start trading in the UAE will define how successful you will be in the short term. From the choices above you need to is ask yourself, what type of business will you have? What are you planning to do trade wise in the UAE, and most importantly where are your business associates and clients going to be.

The most common mistake to make is choosing a license in the wrong Trade Zone, putting your business outside your customer base and out of reach with trading partners.

The majority of companies in the UAE are onshore, based on local sponsorship with UAE Nationals. There are alternatives however to having a UAE National to get sponsorship, for more detail please see the Dubai Economic Department link below.

Please see the link; Department of Economic Development - Practicing Business in Dubai

This web link provides a good guide to the process which you must undertake to set up a basic license, and the different sponsorship options you will have.

As your sponsor will become your UAE business partner, it is important that you find someone who is suited for your business type, activities and long term plans in the UAE. Once you have arranged the right sponsor for you, he/she will be there to assist you through gathering all the required paperwork, approvals and following the procedure to set up your branch/business.

If you are currently thinking about or going to open a business in the UAE, book a meeting with us at Signature and we will help you choose the correct license and structure for your business. +971 4 3116500

Free company formation
and Trade License advice.