Dubai, by its progressive business location backed by government initiatives and policies in the upbringing of different business ideas, had become the consummate choice for the entrepreneur. The availability of different Free zones like JAFZA, DMCC, and Dubai Airport Free Zone etc. makes the establishment easier. Investors are showing more interest in these free zones because of the significant benefits provided by them. There are more than 30 free zones in Dubai, which provide easy and quick establishment policy. Entrepreneurs are keen to know about the benefits of setting up a business in the Free zone, to enjoy 100% ownership.
Dubai Multi Commodity Centre (DMCC)
The Dubai Multi Commodity Centre is a free zone, which is growing fast and is amongst the largest free economic zones in the United Arab Emirates. DMCC came into existence in 2002, and with the year span achieved prosperity by getting registered with 15,000 + members until 2018. DMCC registers approximately 170 companies every month. Some of the leading colossuses accommodated by DMCC include-gold, diamonds, coloured stones and pearls, energy-related sectors, steel and base metals and soft agricultural commodities (tea, cotton, and others). The trading and establishment are quite easier in DMCC, and with the increase in government's initiative, company formation in DMCC is proven to be very effective and profitable.
DMCC recently launched the Middle East's first Google for Entrepreneurs Global Tech Hub in collaboration with Astrolabs Dubai. The Dubai Expo 2020, the global platform to exhibit innovation, ideas, and collaboration is grabbing more attraction from investors towards Dubai Free Zone. Before we take a big dive in the business set up in Dubai Multi Commodity Centre, let's go through the essential factors to be considered before setting up a business in DMCC.
Seven Factors to Consider Before Setting up a Business in DMCC.
Presented below is the list of factors we should be aware of before we conclude of setting a business in DMCC. Let us proceed with the factors-
1) Deciding the company type
The first step is to determine the kind of company you want –
- Branch of local or foreign company.
- Limited Liability Company- Either as a newly formed entity with single or several shareholders or as a wholly-owned subsidiary of a foreign or local company.
The decision is mandatory as you can proceed further for visas and other requirements accordingly.
2) Deciding the type of license
DMCC license type includes-
- General Trading License- Permits the import, export, distribution, consolidation, and storage of products, excluding a few.
- Service License – Gives authority to engage in service or consultancy activities that are specified in the license.
- Industrial License- Allows the implementation of light production activities specified in the license.
3) Business Activity
The type of business activity you want to involve in can include trading, manufacturing, services, etc. which shall be fixed beforehand so that you can proceed as per your specified business plan. The fixation of business activity will help you to apply for visas and licenses; accordingly, different licenses are issued for different business activity.
4) Choosing the Name of Company
The company name is an integral part of the legal procedure, and the title should signify the type of business activity. The company's name should contravene the activity you are involved in. The name should not be similar to the name of an already established company. The name should be different and unique. The DMCC rules and guidelines for the company's name can be seen on the DMCC website.
5) Choose an Office Space
The important point here is to choose an office space, as you have to decide what type of office area you need. Whether you need a warehouse or an office or a building etc. is to be elected as per your requirement. The decision of the appropriate office is required to save your over expenditure cost for the place, to know more details about the offices and its expenses visit Commitbiz business consultant, the guide to your queries.
6) Capital Requirement
In DMCC, the minimum share capital for forming a free zone company is AED 50,000 per company and AED 10,000 per shareholder. For a company to be issued a General Trading License, it should have a minimum of AED one-million share capital.
7) Bank Account in Local Bank
A local bank account is needed to deposit the company's share capital value within three weeks from the issue date of the company's license. Shareholders can withdraw the amount anytime after that. Branches of the company do not require a share capital requirement.
DMCC formation seems to be attractive and effective as the government is giving full ownership and full rights without local sponsorship. DMCC is now the most preferred choice of the entrepreneur because of the various benefits provided by it. Investment in DMCC is always fruitful.
Commitbiz business management consultants are here to help you set up your business profitably in DMCC Free zone in Dubai. Our team has enabled hundreds of businesses to run successfully in the region. If you want to know how we can help you, contact us today.