Steps to establish a company in Dubai for Saudis

Dubai is considered one of the most prominent investment destinations in the world, as it is characterized by a flexible business environment, advanced infrastructure, and government facilities that encourage the establishment of commercial projects. For Saudi investors, establishing a company in Dubai represents a golden opportunity to take advantage of the vast and diverse market in the UAE and the region in general. Dubai offers a variety of options for establishing companies, whether they are local companies, in free zones, or even branches of foreign companies. This variety can be a bit confusing, so it is essential to understand the steps and procedures required to successfully establish a company. In this article, we will discuss in detail the steps for establishing a company in Dubai for Saudis, starting with choosing the appropriate type of company and ending with the necessary procedures after incorporation. We will also review the legal and administrative requirements that must be adhered to to ensure that business runs smoothly and in accordance with local laws.

Steps to establish a company in Dubai for Saudis

Choose the type of companies in Dubai

When thinking about establishing a company in Dubai , Saudis should choose the type of company that suits the nature of their business and business goals. The options available are varied and include local companies, free companies, and foreign branches. We will review each type in detail:

Local companies

Local companies are the ideal choice for those who want to take advantage of the local market in Dubai and the UAE in general. Local companies can take several legal forms, such as limited liability companies (LLC) and public and private joint-stock companies.

Limited Liability Company (LLC): This type of company is the most popular among foreign investors, as it requires a local partner who owns 51% of the company’s shares. Limited liability companies feature personal liability protection for partners.
Public and private joint-stock companies: These companies provide the possibility of raising capital through issuing shares, which enables them to implement huge projects. However, the legal procedures for establishing these companies are more complex and take longer.

Free companies

Establishing a company in one of the free zones in Dubai is an attractive option for Saudis who want to enjoy multiple benefits such as full ownership of the company (100%), exemption from customs taxes, and easy transfer of profits and capital. Popular free zones in Dubai include:

Jebel Ali Free Zone (JAFZA): It is considered one of the largest free zones in Dubai and provides an ideal environment for industrial and commercial companies.
Dubai Internet City (DIC): Targets technology companies and provides advanced infrastructure to support their businesses.
Dubai Automotive and Machinery Zone (DUCAMZ): is dedicated to trade in cars and heavy equipment.

Foreign branches

Major Saudi companies wishing to expand their business in Dubai can choose to establish a foreign branch. This type of company allows the parent company to retain full control of the branch, in addition to benefiting from the UAE market flexibly and easily. Some important points about foreign branches:

Foreign branches are not considered a separate legal entity from the parent company, which means that the parent company bears all legal and financial responsibilities.
Establishing a foreign branch requires obtaining additional approvals from the competent authorities in Dubai, in addition to submitting periodic reports on the branch’s performance.

By choosing the right type of company, Saudis can ensure they start their business in Dubai efficiently and effectively, while making the most of the opportunities available in this global city.

Procedures for registering a company in Dubai

Registration and licensing procedures are considered one of the most important steps that a Saudi investor must follow to establish a company in Dubai . This process consists of several stages that require compliance with the laws and regulations in force in the United Arab Emirates. Below are the details of these steps:

Obtain initial approval

Before starting any formal procedure, preliminary approval must be obtained from the relevant authorities. This approval allows investors to proceed with the next steps in the incorporation process. To obtain initial approval, an application must be submitted containing basic information for the proposed company, such as type of business activity, legal structure, and initial capital. This approval acts as an initial signal indicating that the authorities have accepted the idea of the proposed project.

Preparing legal documents

After obtaining initial approval, investors must prepare all legal documents required to establish the company. These documents include:

Articles of Association: The company’s Articles of Association must be prepared, which explains the rights and duties of the partners in addition to the distribution of financial shares.
Articles of Association: The articles of association include the rules and procedures that regulate the management of the company.
Personal Documents: Copies of passports, entry visas and residence permits for investors and partners must be submitted.
No objection certificates: If one of the partners is an employee in another company within the UAE, a no objection certificate from the current company must be submitted.

Obtaining the final license

After preparing and processing all documents, you must apply to obtain the final license from the competent authorities. The types of licenses vary depending on the type of business activity the company will undertake. For example, commercial and industrial activities require specific licenses that differ from those for professional or service activities.

To obtain the final license, the required legal documents must be submitted to the Department of Economic Development in Dubai or to the competent authority in the free zone in which the company will be established. After reviewing the application and documents, if all conditions are met, the final license is issued that authorizes the investor to officially start his business activity.

These steps form the legal basis for establishing a successful company in Dubai. Saudi investors must ensure that these procedures are followed carefully to ensure the establishment of a company is legal and compliant with local laws and regulations.

Procedures after establishing a company in Dubai for Saudis

After obtaining the final license and officially establishing the company in Dubai, there are a set of necessary measures that must be taken to ensure the smooth operation of the company and its compliance with local laws and regulations. These procedures include:

Open bank account

One of the first steps after establishing a company is to open a business bank account. Having a local bank account is vital to facilitate daily financial operations such as paying salaries, receiving payments from customers, and dealing with suppliers. Opening a bank account requires submitting a set of documents, such as:

Commercial license.
The company’s articles of incorporation and articles of association.
Passports of partners and directors.
Proof of address (such as a utility bill or rental contract).

Employee registration

If the company intends to employ employees, they must be registered with the relevant authorities such as the Ministry of Human Resources and Emiratisation and the Emirates Identity and Citizenship Authority. The employee registration process includes:

Issuing work and residence visas for foreign employees.
Register employees in the Wage Protection System (WPS) to ensure regular payment of salaries.
Providing health insurance for employees, as it is mandatory for all employees in Dubai.

Tax and financial obligations

Although Dubai is considered a personal income tax-free zone, there are some financial and tax obligations that a company must fulfill, such as:

Value Added Tax (VAT): If a company’s revenue exceeds a specified minimum, the company must register for the VAT system and pay it periodically.
Financial reports: The company must prepare annual financial reports and submit them to the competent authorities.
Compliance with anti-money laundering regulations: The company must take the necessary measures to ensure compliance with anti-money laundering and terrorist financing regulations.

By following these steps and procedures, the new company can successfully begin operations and operate smoothly while adhering to all local laws and regulations in Dubai.

At the conclusion of this guide on the steps to establish a company in Dubai for Saudis , we emphasize that starting a business in Dubai provides great opportunities for growth and expansion in a diverse and dynamic global market. Following the mentioned steps and procedures in their correct order will ensure a smooth and successful company establishment, taking into account all legal and financial requirements.

The first step is to choose the right type of company based on your business needs and goals, whether it is a local, freehold company or a foreign branch. Next comes the registration and licensing stage, which requires obtaining initial approvals, preparing legal documents, and obtaining the final license.

After establishing the company, focus must be placed on subsequent procedures such as opening a bank account, registering employees, and adhering to tax and financial procedures to ensure business continuity in a legal and orderly manner.

Dubai is considered an encouraging environment for business and investment thanks to its advanced infrastructure, investment facilities, and continuous government support. So, whether you are a novice entrepreneur or have long experience in the business field, establishing a company in Dubai may be the perfect step to expand your business and achieve new successes.

We hope that this guide has provided you with the necessary and comprehensive information to start your business journey in Dubai, and we are certain that your thoughtful plan and careful implementation will lead to the success and development of your project. Good luck on your business adventure!

The most important frequently asked questions about establishing a company in Dubai for Saudis

Can Saudis establish a company in Dubai without a local partner?

Yes, Saudis can establish a company with 100% ownership in free zones, where a local partner is not required.

What types of companies can be established in Dubai?

Saudis can establish limited liability companies (LLC), companies in free zones, branches of Saudi companies, and private joint stock companies.

What are the documents required to establish a company in Dubai?

Documents include copies of passports, personal photographs, company articles of incorporation, incorporation application form, and office lease contract.