Referred to as one of the most prominent destinations in the Gulf region, Dubai has established a strong reputation as dynamic places in the world for all types of business. Its hospitality, state-of-art infrastructure, geographically strategic location, world-class economic structure and a range of headline-grabbing attention, this country does not have to prove its worth any more than this. The economic diversity of this country draws many expatriates from all over the globe to explore a plethora of business opportunities it offers.
One of the stable forms of investments in critical times is purchasing an item whose value would continue to appreciate and could be sold at a later point of time for profit. For those who don't know, gold is the world's true money and a profitable means of transfer. It is a lawful tender that has stood the test of time, as other money inclines to lose its value due to inflation, market manipulation, and changing government fiscal policies.
Dubai is also known as the ‘City of Gold' for its phenomenal growth from just being a gulf coast to an influential world-wide business hub within the generation. Although all the metals have some practical users, gold stands out from the other because its demand is essentially driven by investment and as a store of value.
Benefits of Starting a Gold Business in Dubai
- 100% foreign ownership if started the business in a free zone
- 100% repatriation of capital if started the business in a free zone
- Shuttle services in and around the complex
- World-class retail centre facilities for businessmen, to service gold buyers
- All-time business security
The gold business can be operated both inside and outside the UAE. What’s important to know here is, wherever you operate from, the tax dealing of these firms remain the same.
In Dubai, there are mainly three regions where one can start a gold trading business. They are as follows;
- Dubai Multi Commodities Centre (DMCC) Free Zone
- Dubai Diamond and Gold Park
- Mainland Dubai
In the remainder of the article, we will discuss the procedure to set up a gold business in DMCC free zone.
Gold Trading Business in DMCC Free Zone
This free zone in Dubai serves the complete value-chain of gold, right from explore and refinement to investment and trading. The free zone devotes first-class infrastructure and series to its businesses due to which there has been a rise in the number of business set up here. There is no other gold business centre in the world that offers such a balancing industry for gold and diamond. Their initiatives include Dubai Gold and Diamond Commodities Exchange (DGCX), a trade finance product, DMCC Trade Flow, Sharia-compliant hedge fund product, regional gold trading option and a Dubai Good Delivery Standard- the only international standard for 1 kg gold bars of 995 purity.
Procedure to Start a Business in DMCC Free Zone
The setup procedure of Gold business in Dubai is divided into three main stages. That is the pre-approval stage, registration stage, and the licensing stage. The in-detail process is as follows-
Stage 1- The Pre-Approval Stage
To start your gold business in the DMCC free zone, it is vital to get initial approval from the authorities. This can be done after submission of name reservation for your company. The authority will reserve the name of your Gold and Diamond business in Dubai and enable DMCC to continue the due diligence of the company. This step usually takes at least five days to complete.
Stage 2- Registering the Company
Once you get the initial approval, the next step is to register your company with the DMCC authorities. Here, you will have to fill an application form mentioning all the required details. Next, you need to gather required documents and attach it with the form. Once this is done, you can submit the form of registration to the authorities. It will take another five days for this stage to complete.
Stage 3- Licensing of Your Business
The last but the most important step in this process is licensing of your gold business in Dubai. The license would permit the company to trade in all kinds of valuable gold within the DMCC free zone and in other countries, that is outside the UAE.
If the company wants to trade in mainland Dubai, there are two ways to do so. They are-
- Trade directly with the LLC company which has an import/export license which would help them clear all goods through customs, or
- The company can go into an agreement with a logistics company that would bring the goods to the mainland.
Also know that, to start a gold business you will also need a SIRA approval. It stands for Securities Industry Regulatory Authority and is one of the important governing bodies. After completing these steps you can sign a tenancy contract and get an office space to operate from. This step requires at least ten days completing.
You can make good cash from the purchase and sale of gold. But initially, you need to take time to learn all the skills before you dive into the business as it contains high risks, and inexperienced newcomers may easily fall into traps and be fooled by shady gold traders.
You can work with someone who knows everything about starting this business, right from incorporation to providing visas to the employees. We at Commitbiz can help you with setting up a gold business in the UAE. Contact us today- even if it’s for a friendly advice.