If you are a serial entrepreneur who is looking to expand your reach into Dubai, it is likely that you may have heard of the Dubai International Financial Centre (DIFC). Being among the most renowned financial hubs in the UAE, the DFIC continues to attract businesses and investors from all parts of the world. As an entrepreneur who is looking to set yourself up in this prestigious free zone, the first step is to secure a DIFC License. In this SetHub guide, we will explain the entire process to you, while highlighting all the key steps, requirements, and benefits of securing this license. Regardless of whether you may be a startup, financial institution, or service provider, this guide intends to simplify the process of how to obtain a DIFC License.
A DIFC License Explained
In simple terms, a DIFC License is a legal document that permits a business to operate inside the Dubai International Financial Centre. This designated free zone is one that places a focus on financial services, professional services, and a wide range of business activities. If your company holds a DIFC License, it will benefit from full foreign ownership, corporate and personal tax concessions, an independent regulatory and legal framework and a strategic location with world-class infrastructure.
Now that we’ve outlined what this licence is all about, let’s get into the process of obtaining one.
Decide on Your Business Activity
The first step towards securing a DIFC License is to identify the business activity you want to engage in. The DIFC supports various categories such as:
- Financial services for banks, investment firms and insurance companies
- Non financial services for consultancies and other agencies
- Retail businesses
- Technology and innovation for fintech startups or tech firms
After you define your business activity, this will help you determine the specific type of DIFC License needed for your business.
Select an Appropriate Legal Structure
Businesses that operate within the DIFC have the freedom to operate under a legal structure of their choice. This must be based on the business activity and other ownership requirements. Some of the more common structures include:
- Private Company which is ideal for startups and SMEs
- Limited Liability Company which is more suited for professional services and partnerships
- Branch Offices for businesses that already have a registered entity outside the DIFC
Deciding on the right legal structure of your businesses is a crucial step in how to obtain a DIFC License as it has an effect on the registration process and compliance requirements.
Submit your Application for Initial Approval
After these steps are done, the next task to complete is the submission of an initial application to the DIFC Authority. You will need to prepare the following documents:
- Business plan
- Shareholder and director info
- Legal structure details
- Passport copies of shareholders and directors
- Proof of address
The DIFC Authority will then review your application to ensure it aligns with its business and regulatory standards.
Secure Regulatory Approvals
Depending on your business activity, you may have to secure additional regulatory approvals. For example:
- Financial institutions need approval from the Dubai Financial Services Authority
- Retail and hospitality businesses have to meet local health and safety regulations.
If you are operating within a regulated industry, then these additional approvals are an important part of obtaining a DIFC License.
Choose an Office Space Within the DIFC
If you set your business up in the DIFC, then a physical office space is a must. Within this free zone you will have many options for this including:
- Flexi desks for startups and small businesses
- Serviced offices for larger companies
- Commercial office spaces
Keep in mind that the office space you select will be registered as your official business address in the DIFC.
Finish the Application and Pay All Fees
After your initial approval is green-lit and the regulatory clearances are all done, the final application can be submitted in order to obtain the DIFC License. At this stage, you’ll need to do the following:
- Complete the license application form
- Provide required documentation
- Pay the fees
In terms of the cost, you can expect to pay between AED 15,000 and AED 50,000 annually. The exact amount will depend on your business activity and chosen legal structure.
Receive Your DIFC License
Once all the reviews are completed and your application is fully approved, you will be issued with a DIFC License. This license is valid for one year and can be renewed every year. With your DIFC License in hand, you can now officially operate within the DIFC and enjoy the benefits offered by this financial hub.
License Renewal
In order to keep your license active, it is your responsibility to keep renewing it on an annual basis. Follow the steps below to carry out the renewal process:
- If your business plan has been updated, submit the latest version
- Provide annual reports that show proof of compliance with DIFC regulations
- Make sure you pay the renewal fees before the expiration date of your license
If for any reason you fail to renew DIFC License on time, expect to pay some penalty fee or a license suspension in the worst case scenario. It is your duty to stay on top of these deadlines so that your business operations can continue unaffected.
In Conclusion,
If you want to set up a business in the hopes of thriving in a competitive and dynamic environment, look no further than Dubai International Financial Centre. If you follow this step-by-step guide, you can secure your DIFC License and take advantage of the opportunities offered by the DIFC. From identifying your business activity to submitting your final application, understanding how to obtain a DIFC License will pave the way for a seamless setup process.
How Can SetHub Help You?
If you’re ready to start your journey in the DIFC, but need some expert assistance on the same, reach out to the experts at SetHub. We understand the nuances of business setup inside the DIFC as we have helped many entrepreneurs just like you in setting up their businesses in this sought after free zone. Schedule a call with us now to hear back within one business hour! Our promise is that you will receive relevant and tailored advice based on your case and requirements.
