Steps to establish a company in Dubai for foreigners without a sponsor

Dubai is one of the most prominent economic and investment destinations around the world, combining rapid growth with a flexible business environment. For foreigners looking to establish their companies in Dubai, the emirate provides many opportunities and facilities that make the establishment process smoother and easier. One of the unique features that Dubai offers is the possibility of setting up a company in Dubai without the need for a local sponsor, giving foreign investors complete control over their business and investments. In this article, we will review the steps for establishing a company in Dubai for foreigners without a sponsor, starting with choosing the appropriate type of company, through the necessary legal procedures, all the way to the expected costs and investments. We will highlight the options available to foreigners and how they can take advantage of Dubai’s thriving business environment to achieve their business successes.

Steps to establish a company in Dubai for foreigners without a sponsor

Establishing a company in Dubai for foreigners

Establishing a company in Dubai for foreigners has become a popular option due to the many facilities and benefits that the emirate offers. Dubai, known as one of the most important commercial centers in the world, offers an ideal environment for business thanks to its stable economy, advanced infrastructure, and strategic location linking East and West. Establishing a company in Dubai for foreigners can be done in free zones or in non-free zones, and each has its own advantages.

In free zones, foreigners can own 100% of companies without the need for a local partner. These zones, such as Jebel Ali Free Zone and Dubai Internet City, offer tax exemptions, simplified incorporation procedures, and a business environment conducive to growth and prosperity. By establishing a company in free zones, foreigners can benefit from advanced infrastructure, enjoy full ownership of the business, and avoid restrictions imposed on companies operating in the local market.

In addition, Dubai has updated its laws to allow foreigners to fully own companies in some activities outside the free zones, enhancing the emirate’s attractiveness as a global business centre. Foreigners can establish limited liability companies, branches of foreign companies, or commercial companies depending on the type of business activity and the future goals of the company.

The incorporation process includes several steps, including choosing the type of company, choosing an appropriate trade name, submitting the required documents such as copies of passports and the company’s articles of incorporation, and obtaining the appropriate license from the competent authorities. New companies must also rent an office or commercial space, open a bank account, and hire consulting services to ensure compliance with all legal and administrative requirements.

Thanks to government facilities, an encouraging economic environment, and tax advantages, Dubai is an ideal destination for foreigners to establish companies. The emirate offers vast opportunities for investment and growth, making it an ideal choice for entrepreneurs and international investors looking to expand their businesses in the Middle East region and beyond.

Types of companies that foreigners can establish in Dubai

When embarking on setting up a company in Dubai , choosing the type of company is a crucial step that affects all aspects of the future business. The available types of companies vary based on investors’ requirements and business objectives, and include limited liability companies, private joint stock companies, and free companies. In this section, we will review these different types and explain the advantages and disadvantages of each.

 Limited Liability Companies (LLC)

Limited liability companies are one of the most popular types of companies among foreign investors in Dubai. These companies are distinguished by the fact that they give their owners legal protection from the debts and financial obligations of the company, which means that their liability is limited to the amount of their contributions to the capital.

• Advantages of limited liability companies:

Legal protection: Provides protection to investors from the company’s financial responsibilities.
Flexibility in management: The management structure can be organized in a flexible manner that suits the company’s needs.
Wide acceptance: Widely recognized by government agencies and banks.

• Disadvantages of limited liability companies:

Ownership restrictions: There must be a UAE national partner who owns 51% of the company’s shares.
Additional costs: Additional costs may be required to hire a local service agent.

Private joint stock companies

Private joint stock companies are companies that can be wholly owned by foreigners and allow them to raise capital through the sale of shares. It is considered a good option for large companies that plan to finance large projects or enter the financial market.

• Advantages of private joint stock companies:

Possibility of raising capital: It allows raising capital through the sale of shares.
Full Foreign Ownership: It can be fully owned by foreign investors.
Independence: You do not need a UAE national partner.

• Disadvantages of private joint stock companies:

Regulatory complexity: Requires complex legal and regulatory procedures.
Establishment costs: Establishment and management costs can be high.

 Free companies

Free enterprises are an ideal choice for investors who want to take advantage of the economic facilities and tax advantages available in Dubai’s free zones. Foreign investors can fully own freehold companies without the need for a UAE national partner.

•  Advantages of free companies:

Full foreign ownership: Foreign investors can own 100% of the company.
Tax exemptions: Free companies enjoy tax and customs exemptions.
Ease of procedures: Free zones provide simplified and quick procedures for establishing companies.

•  Disadvantages of free companies:

Geographical Restrictions: Business must be conducted within the designated free zone.
Type of activity: There may be restrictions on the type of activities that can be undertaken.

Steps to establish a company in Dubai for foreigners without a sponsor

Establishing a company in Dubai for foreigners without a sponsor requires following a set of careful legal procedures to ensure full compliance with local laws and regulations. Here we review the basic steps that foreign investors must follow:

Trade name registration

The first step in the legal procedures is to choose and register the company’s trade name. The trade name must be unique and not used by any other company in Dubai. It is preferable that the name reflects the nature of the work that the company will do. After choosing the name, an application is submitted to the Department of Economic Development to obtain approval for the trade name.

Preparing legal documents

The next step involves preparing all the legal documents required to register the company. These documents usually include:

1. Articles of Association: This is the legal document that specifies the details of the company, such as its name, capital structure, and the names of partners or shareholders.
2. Articles of Association: The articles of association set out the provisions and regulations that will govern the management of the company.
3. Documentation of identities: Certified copies of passports and personal certificates must be submitted for all partners or shareholders.

All documents must be translated into Arabic and certified by the competent authorities.

Obtaining the required licenses

After preparing and submitting the legal documents, investors must obtain the necessary licenses to start business. The licenses required vary based on the type of business activity the company will be conducting. Some common licenses include:

1. Commercial license: This license is granted to companies operating in commercial activities such as retail and wholesale.
2. Industrial license: issued to companies that manufacture or produce.
3. Professional license: Granted to companies that provide professional services such as consulting or legal services.

Investors must apply to obtain the appropriate licenses from the relevant government agencies such as the Department of Economic Development and other relevant regulatory bodies.

By carefully implementing these legal procedures, foreign investors can establish their companies in Dubai without the need for a sponsor, and begin conducting their business in a legal and orderly manner.

Costs of establishing a company in Dubai for foreigners without a sponsor

When establishing a company in Dubai for foreigners without a sponsor, understanding the financial and investment aspects is an essential part of the incorporation process. This includes determining the capital required, operational costs, and taxes and fees associated with running the company.

Required capital

The required capital is one of the first steps that an investor must determine when establishing a company in Dubai. The amount of capital varies depending on the type of company you intend to establish. For example, limited liability companies need less capital compared to private joint stock companies. The capital must be sufficient to cover all initial and operating expenses for the company to start making profits.

Operational costs

Operational costs include a wide range of expenses that a company must incur to continue operating efficiently. Among these costs:

1. Office or facility rent: varies depending on location and size of space required.
2. Employee salaries: Varies based on employee skills and experience.
3. Administrative expenses: include costs related to office supplies, communications, and Internet services.
4. Marketing: The costs of advertising and promoting products or services.
5. Insurance: Insurance for the company, property and employees.

Taxes and Fees

Dubai has an attractive tax environment for foreign investors, as it does not impose income taxes on individuals or companies. However, there are some government fees that must be paid, such as:

1. Commercial registration fees: vary depending on the type of company and commercial activity.
2. Municipal fees: related to building and operating permits.
3. License fees: Includes fees for obtaining the licenses required to conduct business.

These financial aspects are among the most important things to consider when establishing a company in Dubai, to ensure success and sustainable growth. It is essential to hire a financial advisor or CPA to help manage these costs efficiently and ensure compliance with all financial laws and regulations.

In conclusion that establishing a company in Dubai for foreigners without a sponsor represents a golden opportunity to benefit from the thriving investment environment in the emirate. By following the thoughtful steps and choosing the appropriate type of company, foreign investors can establish their businesses easily and conveniently. Legal procedures, which include registering the trade name, preparing legal documents, and obtaining the required licenses, are among the basics that must be adhered to to ensure the successful completion of the process.

In addition, investors should be aware of the costs associated with establishing and operating a company, including required capital, operational costs, and potential taxes and fees. Through good financial planning and adherence to applicable laws and regulations, success and growth can be achieved in the promising Dubai market.

In conclusion, it can be said that establishing a company in Dubai without a sponsor for foreigners is an attractive investment option that allows them to benefit from the many opportunities that the emirate offers. In conjunction with government support and facilities provided to investors, foreigners can achieve their business goals and contribute to the growth of the local economy. By following the steps and procedures mentioned in this article, foreign investors can begin their investment journey in Dubai with confidence and reassurance.

The most frequently asked questions about establishing a company in Dubai for foreigners without a sponsor