Business setup in the UAE – 2022 guide


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The UAE has long been a destination of choice for ambitious entrepreneurs from the world over.

It’s easy to see what makes the country such an attractive prospect. As well as its famed low tax environment – with 0% tax on both personal and corporate income – the UAE also benefits from an ideal trading location.

At the heart of the Middle East, the UAE is perfectly placed for international trade, with the Asian, African and European markets in easy reach. Home to two of the world’s busiest airports, the Emirates is also easily accessible for international business travellers from every corner of the globe.

Then there is the UAE’s welcoming business environment – regularly ranked favourably in the global Ease of Doing Business Index. Provided you seek the right guidance, starting a business here can be an incredibly straightforward process.

To ensure you’re in the know before you take your first steps into company formation in the UAE, here’s our simple guide to starting a business here.


Business setup in the UAE

The UAE company formation process consists of seven simple steps. While these steps may not be complex, they do require a working knowledge of business practices in the country. For that reason, it is a good idea to work closely with a company setup expert along the way.


Step 1: Choosing your business activity

The first, and one of the most important, steps when setting up here is choosing your business activities. These will determine where you can set up and what license you require.

Dubai’s Department of Economic Development (DED) lists thousands of activities that you can choose from. You are free to select more than one, but it is vital that you list every activity you wish to undertake. Failure to do so could lead to licensing issues further down the line.


Step 2: Deciding on a company license
There are several licenses available in the UAE. The one that is right for you will depend almost entirely on your chosen business activities.

If your business activities fall into the category of industrial or manufacturing, then you will require an industrial license. If you are in the commercial sector, i.e. the buying and selling of goods, then you will require a commercial license – and so on.


Step 3: Picking a company name
Choosing a company name is a hugely important step in establishing a UAE business. There are a few things to keep in mind when making this decision. You must abide by a strict, yet easy to follow, set of naming conventions. Once again, a company setup expert can help you with this step.

In short, you should avoid any offensive or blasphemous language. Avoid names of well-known organisations and avoid abbreviations if naming your company after yourself – i.e. Dave Mann Consulting, rather than D Mann Consulting. You must also check that your chosen name is available to register.


Step 4: Deciding on a free zone or mainland setup
There are two common business types in the UAE – mainland companies and free zone companies.

There are many advantages to both. Free zones such as Fujairah Creative City offer benefits such as a quick and easy incorporation process, ongoing business support and financial incentives such as tax exemptions and zero currency restrictions. Meanwhile, mainland businesses can trade directly with the UAE market and take on potentially lucrative government contracts.

The setup that’s right for you will depend on the nature of your business.


Step 5: Making your license application

The most pivotal step in company formation is applying for your license. If you haven’t already, it is strongly advised that you make use of business setup services in the UAE.

Your business setup partner can make and manage your application for you – applying either to the relevant Department of Economic Development or the managing authority of your chosen free zone.

Whether making your application yourself, or through a company formation agent, you are usually only required to provide a few details and some basic documentation, including:

  • Completed application form
  • Passport copy of the proposed owner or owners
  • Two colour passport size photos.


Step 6: Applying for your visa

Just like applying for your trade license, with the right guidance, the process of applying for your own visa, as well as those of your employees, is particular, yet straightforward. Again, an expert in UAE company formation can help you with this step.

As the holder of a UAE business license, you can also sponsor others for their visas too. This could be a spouse, parent or child, or a domestic worker such as a housekeeper.

The maximum number of visas you can apply for will depend on the size of your company, your chosen setup and, for dependant visas, your personal earnings.


Step 7: Opening your business bank account
Strict money laundering regulations can make it difficult for overseas entrepreneurs to access corporate banking facilities. Working with an expert in the field makes for a much smoother process.

When you work with a company formation expert, you get access to their connections with both local and international banks. Many company formation agents will also arrange meetings for you in branch if required.


Estimating business setup costs in the UAE

Cheap business setup in the UAE is by no means hard to find. It is, however, not always easy to get an idea of the total costs involved.

The cost of setting up a business here will depend on many factors including your license type, location, number of employees and the size of your premises.

If, however, you are looking for cheap business setup in the UAE then you should certainly consider setting up in a free zone.

Free zones such as Fujairah Creative City offer many affordable license packages with no paid-up share capital requirement, no annual audit and an easy incorporation process. There is also no need to be present in the UAE to establish your new company.

A license package in Fujairah Creative City, inclusive of one visa application and use of the free zone’s co-working facility costs just AED 24,775.


Getting started in the UAE

If you’re armed with the right knowledge, setting up a business in the UAE doesn’t have to be overly complex.

That being said, it does require a level of prior knowledge of the process. What’s more, it is important to note that the application process is only straightforward if your license application is complete at the time of submission and free from errors.

To help you to ensure that this is the case, it’s a good idea to work with a company formation specialist such as Set Hub when establishing a new company in the UAE.

We are a team of company registration professionals who are passionate about bringing the dreams of aspiring entrepreneurs and SMEs to life.

As well as handling your license application, Set Hub can also assist with the opening of corporate bank accounts and advise on the most appropriate financial institution to suit your specific needs.

We also offer visa and immigration services and can handle all government formalities, permissions, work permits and visas applications that are required to trade in the UAE.

In short, our experts can establish your company on your behalf, make your license and visa applications, and take care of all the necessary admin – leaving you free to get on with running your business.