Abu Dhabi is becoming the largest business destination in the Middle East and the UAE government has made some remarkable efforts to achieve this status. For instance, no income tax to fully retain profits, low import taxes, or even world-class infrastructure. That’s why investors are seeking to form a new company in Abu Dhabi.
If you are also one of them, you are at the right place as here we discussed the simple 10-step guide to help you set up a business in Abu Dhabi.
How to Start a Business in Abu Dhabi
- Choose Business Activity
Your journey to setting up a business in Abu Dhabi begins with defining your purpose. So, the very first and foremost step you need to take is to visit the Abu Dhabi Department of Economic Development (DED) website and ensure your chosen business activity is on the approved list and aligns with its framework.
Remember, certain sectors like healthcare or education also need special permission. With that, there are 6 types of business activities in UAE ranging from industrial, commercial, agricultural, tourism, professional, or occupational structures.
Once you are done choosing your desired activity; you can move toward the next step of determining the legal structure.
- Determine Legal Structure
The next step is deciding on your business structure as each one has its own rules, regulations, and requirements to apply for a company license.
If you’re a solopreneur or a small business with one owner, a sole proprietorship is the simplest option. But remember, this structure merges your personal and business assets.
For businesses with multiple owners, forming a Limited Liability Company (LLC) is a popular choice. If your business is already established elsewhere, consider setting up a branch of a foreign company. However, there might be limitations on permissible activities for foreign branches, so consulting with a business formation specialist is recommended.
- Register your Company Name
Now it’s time to pick a name for your company or chosen business activity that must reflect your brand and resonate with your target audience. In this regard, the DED’s Business Registration and Licensing (BRL) system allows you to reserve your company name online.
Remember, the name should adhere to Abu Dhabi’s naming conventions. There must not be any offensive or geographically misleading terms in your chosen trade name. Availability checks can take up to 3 days, so plan accordingly.
- Obtain initial approval
Once you have decided on your business activity, structure, and trade name – now is the time to secure initial approval from the DED. This initial approval is necessary before you apply for a company license.
For this, all you need is to prepare a detailed business plan outlining your activity, target market, financial projections, and the team behind your vision. This plan helps the DED assess your business’s viability. Consider seeking help from a business setup consultant to streamline the journey.
- Prepare Memorandum or Articles of Association
For companies with multiple owners, a crucial document is the Memorandum or Articles of Association (MOA/AOA). This outlines ownership percentages, profit-sharing agreements, company objectives, and voting rights for shareholders. It is generally required if you have any of these legal structures: Limited liability company (LLC), Limited partnership, Private joint-stock company (PrJSC), or Public joint-stock company (PJSC).
At this step, to ensure a tailored MOA/AOA that complies with UAE commercial law, we recommend engaging a lawyer or legal consultant specializing in this area.
- Find Your Business Location
Finding the perfect location for your business operations is important. Don’t worry, Abu Dhabi offers a variety of choices, from coworking office spaces in business centers to commercial areas suited for specific industries.
Before you choose, consider a few factors like proximity to clients, infrastructure needs, and operational costs before finalizing a lease agreement. Don’t forget to get the lease attested by the Real Estate Regulatory Agency (RERA) in Abu Dhabi, as this document is typically required for licensing.
- Open a Corporate Bank Account
To ensure financial transparency and simplify record keeping, we suggest creating a dedicated corporate bank account. Approach major banks in Abu Dhabi with your business license application documents.
Different banks might offer varying features and fees for corporate accounts, so do your research to choose the one that best suits your needs.
- Apply for Licence
With all the necessary documents (initial approval, MOA/AOA, lease agreement, certificate of paid-up share capital, etc.), submit a formal application for a business license to the DED. Fees are associated with types of business licenses in UAE or your chosen activity.
- Register the Company
Once your license is issued, complete the company registration process with the DED. This finalizes the legal establishment of your business.
- Obtain Visas
The final step involves obtaining visas if you or your employees require them to work in Abu Dhabi. You can sponsor their visa applications after company registration. Visa requirements depend on nationality, job role, and company structure. Consulting with immigration specialists can ensure a smooth visa application process for your team.
How Ignite Zone Can Help You?
In conclusion, the process of setting up a business in Abu Dhabi may seem complex, but with careful planning and the right guidance, you can navigate it successfully.
While this guide offers a roadmap, Ignite Zone can be your partner in making this journey smoother. Our team of experts in Abu Dhabi understands the legalities, regulations, and intricacies of business formation and can help you empower your vision.
Book a free consultation at +971 4 575 211 0 or email us at email, [email protected].
