The United Arab Emirates has come a long way to being a business-oriented country. The UAE is a Commercial and Trading Hub. It is the second largest out of the 25 other Arab economies after Saudi Arabia. It has a gross domestic product (GDP) of approximately AED 1.47 trillion in the year 2015. This GDP has increased by 4.6 percent throughout the preceding years. There is a huge surge of commercial business in the UAE. This never-ending increasing rate of the economy of the United Arab Emirates is the reason more number of businessmen and investors are attracted towards the emirate.
In the year 2016, the report stated that the non-oil sector of the UAE has contributed to the GDP with an increased rate of 70 percent. This was mainly possible because of the country’s economic diversification strategy. The UAE has become an important regional and international business set up companies in recent times.
The Commercial Business Sector in the UAE
Around 9.4 million population and millions of visitors every year the UAE is emerging as a business hub of the world. With the contrasting landscapes, beautiful geographical location and oil wealth, it makes many budding entrepreneurs and investors set up their commercial businesses in the UAE. The UAE government has also made several rules and laws which attracts a number of people to start their businesses.
Reasons to Start a Commercial Business in the UAE
- Strategic locations
- Well connected destinations for International business
- Various Trade policies
- Open economy accepting all kinds of International trade
- Liberating Tax policies and Laws
- No undue taxes on Foreign and National stakeholders
- Nominal or zero tax impositions
- Fuelling growth of the economic diversification strategy
- Diverse global culture
- Easy and handy procedures to set up any business company
- Business-friendly Government policies
- Stable Government
- Competitive and low priced real estate charges
- Skilled workforce available
- No international hiring restrictions
While establishing your commercial business in the UAE, you can either set up in any of the free zones or mainland. There are 48 free zones in the UAE where you can set up your business. Setting up your business in the mainland can also be profitable as it attracts more people. If you want to start up your commercial business in the free zone there some different regulations which will depend upon the free zone you have chosen. There are different rules for different free zone decided by the concerned authorities of that free zone.
Commercial Companies in the Mainland in the UAE
- A UAE national can hold 100 percent business equity
- If any foreign person wants to set up business in UAE, at least 51 percent of shares should be owned by the UAE national
- Restriction on commercialized geographical areas will be covered under the jurisdiction of the Emirati government.
- All the legal structure and rules that are set by the Government and must be followed therein.
Commercial Companies in the Free Zone in UAE
- 100 percent foreign ownership allowed
- UAE residence visa for 3 years.
- Tax-free and with low trade barriers
- No customs duty
- Are generally located in strategic locations, national borders, seaports, airports, which maximizes trading advantages
- Single- window administration
Steps to Set up Commercial Companies
1.Determine the Location
Choose a location where you want to set up your business. Decide whether it is on the mainland or any of the free zone. To set up the business to choose a location which is appropriate for your business is very important. According to the locations there are different regulations to set up a company. If a business in the mainland then all the procedures are handled by the Government whereas, for any free zone, the free zone authority will be responsible.
2.To Choose the Legal Entity and Trade Name
The important thing is to choose what type of commercial business you want to set up. After you select the type of business the next important thing to do is to register your trade name. You have to check whether the trade name registered is unique and describe your business.
3.Commercial Business License
The most important step to start your business and register your company is to obtain a commercial business license. In the case of a company registered in the mainland, the commercial license shall be approved by the Department of Economic Development. When a company is registered in a free zone the Commercial business license is approved by the concerned free zone authority.
All the Necessary Steps should be Followed for Obtaining the Commercial Business License.
- Fill the application form to the concerned authority
- Copy of business plan
- Required documents to be submitted to the authority
- Additional documents as to qualification etc must be submitted
- Information and documents as to the location of office must be submitted
- Obtain approval from the DED, on all the documents
- General documents, a copy of passport and visa should be submitted.
- Approval from the DED
Approval for setting up a company and documents must be verified by the Department of Economic Development (DED).MOA and AOA must be prepared for the company.
Setting up a commercial business may seem easy but in practicality, they can be really complex, so to avoid any uncertainty it is better to take help from any business consultancy. We are here at commitbiz to advise you and solve any problem that occurs in the incorporation procedure. Contact us- we are glad to help.