Setting up a business in the United Arab Emirates (UAE) requires meeting specific legal and operational requirements. While some steps are straightforward, others involve financial considerations. Whether opting for a free zone set-up or mainland company formation in the UAE, factors such as minimum investment, office space, and licences play a crucial role. This guide outlines only the essential steps that require investment, helping entrepreneurs plan their business set-up effectively.
The first decision is whether to set up the business in a Free zone or on the Mainland, as this determines ownership rights, operational scope and regulatory requirements of free zone business set-up and mainland business set-up. Investment required: Costs vary based on chosen free zone and mainland authorities.
After choosing the jurisdiction, businesses must register under an appropriate legal structure, which also determines the type of licence they need.
• Limited Liability Company (LLC) (Mainland and Free Zone): The most common structure, offering liability protection. • Sole Establishment (Mainland): Suitable for single-owner businesses providing professional services. • Free Zone Establishment (FZE): Single-shareholder entities operating within a Free Zone. • Branch of a Foreign or Local Company: Extension of an existing business without a separate legal identity. The licence type is linked to the business structure and activity: • Commercial licence – For trading businesses. • Professional licence – For service-based businesses. • Industrial licence – For manufacturing and production. • Freelancer permit – For individual professionals in free zones. Investment required: • Licence fees: Issued by the free zone authority or the Department of Economic Development (DED) for mainland businesses. • Additional approvals: Some industries require permits from regulatory bodies.
A registered business in the UAE usually requires a legal address. The office space requirements depend on the jurisdiction: • Free zone companies: Options include flexi-desk spaces, shared offices or dedicated commercial offices. • Mainland companies: Must lease a physical office or commercial premises in compliance with DED regulations. Minimum Investment required: • Office rental costs: Varies based on location, size and lease terms.
While many free zones allow businesses to start without paid-up capital, certain industries and business structures require a minimum capital declaration. Mainland businesses may also need to specify capital amounts in their legal documentation. Investment required: • Initial capital deposit (if applicable).
Businesses must obtain visas for owners, employees and dependents. The number of visas a company can apply for is linked to office space and business activity. Investment required: • Investor visa fees. • Employee visa and work permit costs. • Medical tests and Emirates ID processing. Starting a business in the UAE requires careful planning to meet the minimum legal and financial (including investment) requirements. While some steps, like choosing a business name and defining activities, do not involve costs, licensing, office space, visa applications and capital requirements do. Understanding these costs in advance helps entrepreneurs optimise their investment and streamline their business formation process. With flexible set up options in free zones and the Mainland, the UAE remains one of the most business-friendly destinations globally.
Starting a new business in the UAE requires thoughtful planning, compliance with local laws and effective marketing. Ras Al Khaimah Economic Zone (RAKEZ) can support businesses through its streamlined set-up process and flexible business solutions. Located in the northernmost part of the United Arab Emirates (UAE), Ras Al Khaimah (RAK) stands as an ideal location for business set-up ventures. RAKEZ stands out among the UAE free zones for its affordability, flexibility and diverse range of business activities. It accommodates various sectors, from trading and manufacturing to services and consultancy, making it a popular choice for many entrepreneurs. If expertise, dedication and holistic solutions are what you seek, look no further. The company formation consultants at Ras Al Khaimah Economic Zone (RAKEZ) are committed to handholding you through every phase of your business set-up, ensuring a seamless and rewarding journey. Contact RAKEZ today to embark on your entrepreneurial journey in the UAE: Phone: +971 7 204 1111 Email: info@rakez.com
Don't forget to share this article!