Starting A Business In Dubai As A Foreigner: All Things You Should Know!

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The economic hub of the Middle East ‘Dubai’ has business opportunities for foreigners who want to set up their business from scratch. As a matter of fact, 90% of the population are foreigners in the city. This means that it is a lot easier for foreigners to operate their businesses as they will get a lot of support from the government. According to the Global Entrepreneurship Monitor Index  UAE is number one in the world for its business environment.

Dubai’s Government encourages foreign and domestic investments in the economy through many incentives and tax rebates. However, starting a business within the UAE, as a foreigner can be truly a difficult task to accomplish. 

Before going into the process there are several things that need your attention. This article will give you the information needed to make this decision to help increase your chance of success.

Things a Non Resident Should Know Before Starting A Business In Dubai

Legally, any person residing abroad may open and operate an entity in Dubai. To make your business successful some important things need to be understood. Also, to register a business in Dubai you must have a local sponsor or partner that is resident in Dubai.

1. Understand The Jurisdiction 

There are 2 jurisdictions in Dubai. Foreigners have the choice to choose from free zones and the mainland.

These are the paths that you can choose from when trying to establish a business. However, both choices have their laws and regulations which you must abide by. Here is a brief introduction of both areas that will help you to make a choice easy:

Free Zones: These free zones are mostly located on the outskirts of Dubai. They are open to all foreign and local businesses. The Free Zones are located in Jebel Ali Free Zone, Dubai Media City, Dubai Medical Healthcare City, and many more.

They are known as the most favorable part of the country for foreign investors. They provide 100% foreign ownership and there is no corporate income tax for companies operating within free zones. 

Mainland: The mainland comprises the main cities of Dubai. You must register your business in one of these cities. There are many benefits associated with starting a business in the mainland but you do need to understand its limitations. For example, you may need a local partner to operate or register your business.

2. Trade Licenses

In the UAE, the Department of Economic Development has the authority to issue the license to businesses. Foreigners can choose from different types of licenses offered by the department depending on the type of business that they want to establish. The most common types are:

Commercial: This type of trade license allows you to run a commercial enterprise. Usually, this type of license is for import/export businesses that do not require manufacturing.

However, there are some restrictions that you need to be aware of. For instance, the commercial license is only valid for an establishment of a physical location and it is only valid for people who have citizenship in the UAE.

Manufacturing or Industrial: This type of license allows you to run any kind of manufacturing activity on your premises. However, you may face restrictions depending on the zone you select for each of these licenses.

Service or Professional: This type of license allows you to run a service-related business. Other criteria are tied to this license as well.

Step-By-Step Process To Start A Business in UAE As a Foreigner

Dubai is a great place to start a business. However, some things are still being regulated. The steps to set up your business will depend on the type of business that you are trying to start. Here are a few:

  1. Business Type: It is important that you choose the business type that will suit your needs. For example, if you have a large capital to invest, it would be wise to start a manufacturing or service business rather than a small business.
  2. Choose a Name For Your Business: This is an important step to give a name to your business. A unique name is the identity of a business that will help you attract customers. Moreover, the name must be different from all other businesses that are operating in the country. 
  3. Location: To determine the right location for your business, it is important to know about what types of businesses are already operating in the area where you want to establish one. 
  4. Get A License: In the UAE, you must get a license for each type of business that you want to establish. This is the most crucial step to start a business. The Department of Economic Development issues licenses to business entities. The foreigners can apply for the license according to the type of business.
  5. Register Your Business: You have to register your business with the appropriate government agencies after determining what type of business you want to run. For this process, you need to complete all required documents, identity proofs, license, and bank account details. You may need a sponsor to help you with this process. Since some licenses have limitations on how many people can be involved in such projects or what type of businesses an individual can start.
  6. Get A Business Visa: If you are looking to start a business in Dubai, you must have a business visa. The process of obtaining this visa is fairly simple. It requires that you apply for a temporary residency that can be renewed before the expiry date. Moreover, this visa helps business management to move freely. 

Document Required For Starting A Business In Dubai As a Non-Resident

To start a business in Dubai some basic requirements need to be fulfilled that include:

  • Filled application form
  • Company formation document (certificate of incorporation, articles of association, and board of directors)
  • NOC from a local sponsor
  • Documents proving the authenticity of capital (identity documents)
  • Business Plan
  • Colored passport copies of the Company’s management
  • Audited financial reports for two years from bank

Approvals Required For Business Setup:

To start a business in Dubai as a foreigner, you must obtain approvals. Different types of businesses require permission from government agencies. For example, you are running a business that involves manufacturing or producing industrial items, you will have to rent a factory space in Dubai that meets the minimum size required by the government. This ensures your business follows the rules and guidelines for industrial activities in the area.


Registering your company as a foreigner in the UAE can be time-consuming, confusing, and risky due to the constantly changing rules, posing challenges for foreigners. it also involves a lot of planning, thorough research and extensive groundwork.

I suggest you to get guidance from the company formation experts at Now Consultant. they will understand your needs, recommend the best approaches, and handle the entire process of business formation.

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