How can an Entrepreneur start an E-Commerce Business in Dubai Free Zone?

by Zaara 11, Oct 2019

The E-Commerce market has been making a mark worldwide and is continuously expanding at tremendous growth. With the availability of almost all goods and services online, everything is now a click away. With the introduction of smartphones, shopping has never been more convenient. Online shopping has grown almost 15 times what it was a decade ago. A report stated that over 90 per cent of the UAE population has access to the internet. This is good news for potential E-Commerce Enterprises.

The introduction of Free-zones has only improved the working conditions for those looking to start an E-Commerce Company in Dubai Free-zones. For an E-Commerce company, the place of operation is irrelevant as long as there is a good internet connection. This means that the initial costs of setting up the E-Commerce company are minimal because of no tax and very minimal fixed costs.

Steps to be taken to start the E-Commerce Business in Dubai Free zones

The introduction of Free-zones has only improved the working conditions for those looking to start an E-Commerce Company in Dubai Free-zones. Here are the steps to be taken to by a businessman to start an ecommerce business:

  1. Decide the structure of the company

The initial step to be taken before is to decide the structural framework of the company. These are:

  • Free Zone Company (FZ Co.) or Free Zone LLC (Limited Liability Company).
  • Free Zone Establishment (FZE)

Some Free Zones restrict registering of both types and may allow any one of the two. The differences are based on the number of shareholders and whether such shareholders are natural or legal persons. Each Free Zone has an authority that is the apex body for the Free Zone.

  1. Decide the location

The next step would be to decide on a location to set up the company. There are over 24 Free-Zones in Dubai, and it would be wise to choose a free zone that is well connected to other parts of the UAE as well as ones with good infrastructure. Some prominent Free zone in which an entrepreneur can look into are:

  • Dubai Internet City
  • Dubai Multi Commodities Centre
  1. Come up with a Trade Name

The next step is to come up with a trading name. A catchy and straightforward name would be ideal, but keep in mind that the same name has to be associated with the domain name failing which, traffic would be diverted elsewhere cause of the mismatch between the trade name and domain name.

  1. Apply for an E-commerce License

The next step is to apply for an E-commerce License. There has been a surge in the issuance of these licenses as there has been a boom in this sector. For a Free-zone license, an application has to be made to the Free-zone authority.

  1. Submit all the Documents

The next step involves applying for an initial approval whereby one would be required to submit documents such as

  1. Application form
  2. A complete Business plan with all details
  3. Passport copies of Shareholders
  4. Letter of Intent
  5. Title Deed
  6. RIC ( Registry Identification Code) form for Manager or Director ( It should be original and notarized)
  7. Any other documents requested by the said authorities

Once all formalities and documentation processes are completed, an E-Commerce license is issued, and business activities can take place right after.

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How is the future looking for new and foreign entrepreneurs in Dubai?

The economy of Dubai is growing and there is a huge scope for the development and growth of businesses in the MENA region.

Which are the most profitable sectors in Dubai?

The different sectors which have a very positive outlook are:

  • Health care Sector
  • Pharmaceutical Sector
  • Retail Sector
  • FMCG Sector
  • E-Commerce

Can a foreign entrepreneur or businessman setup a business in Dubai?

Yes, the process of setting up a business has been made simpler by the UAE government.

How has been the growth of E-Commerce sector in UAE?

In the year 2021, we saw that 75% of the respondents made online purchases as compared to 2020.

How big is the E-Commerce sector in Dubai?

In the year 2021, the E-Commerce sector reached over 5 Billion dollars in valuation.