Step-by-Step Guide to Company Set-Up in Dubai: Costs, Documents & Business Structures Explained

Starting a business in Dubai is an exciting opportunity with immense potential, thanks to its thriving economy, strategic location, and business-friendly environment.
Company Set-Up in Dubai requires a clear understanding of legal requirements, business structures, and associated costs to ensure a smooth and compliant launch.

This guide walks you through everything you need to know—from selecting the right jurisdiction to obtaining your trade license.

1. Why Choose Dubai for Company Set-Up?

Dubai offers one of the most dynamic and diversified economies in the Middle East. Entrepreneurs benefit from:

• 100% foreign ownership in Free Zones

• Tax incentives and no personal income tax

• Access to global markets

• State-of-the-art infrastructure and logistics

Whether you're a startup, SME, or multinational, Dubai provides the right conditions for success.

2. Decide Your Business Activity

The type of license and jurisdiction you choose depends on your business activity. Common categories include:

• Commercial (trading)

• Industrial (manufacturing)

• Professional (services and consultancy)

Each activity has specific requirements and regulations that must be followed during the registration process.

3. Choose the Right Jurisdiction

You can set up your company in three main jurisdictions:

• Mainland – Ideal for doing business anywhere in the UAE without restrictions.

• Free Zone – Offers 100% foreign ownership, tax benefits, and fast processing.

• Offshore – Suitable for international business with no physical presence in the UAE.

Your decision depends on your business goals, target market, and capital investment.

4. Select a Legal Structure

Here are common business structures in Dubai:

• Sole Proprietorship

• Limited Liability Company (LLC)

• Civil Company

• Branch of a Foreign Company

• Free Zone Company (FZC or FZE)

An LLC is the most popular choice for mainland businesses due to flexibility and local market access.

5. Register a Trade Name

Your company’s trade name should:

• Reflect your business activity

• Avoid offensive or religious references

• Be approved by the Department of Economic Development (DED) or Free Zone Authority

Registering a unique name early in the process is important to avoid delays.

6. Obtain Initial Approval

You need initial approval from the DED or relevant Free Zone to confirm:

• Your proposed activity is acceptable

• The UAE government allows the business type This approval acts as a preliminary go-ahead before final licensing.

7. Prepare Legal Documents

Typical documents required for company set-up include:

• Passport copies of shareholders

• Visa copies (if applicable)

• Memorandum of Association (MoA)

• Lease agreement for office space

• Trade name approval

• Initial approval certificate

Some Free Zones or jurisdictions may require additional documents or notarization.

8. Finalize Office Space or Business Address

A physical address is mandatory for most business licenses. Depending on the jurisdiction:

• Mainland businesses must have a physical office.

• Free Zone companies often offer flexi-desk or virtual office options.

Ensure your office lease is compliant with government requirements.

9. Apply for Business License

Once documentation is ready and approvals are in place, submit your application for a business license. Based on your business activity, this may be:

• Commercial License

• Industrial License

• Professional License

The license is issued by the DED (for mainland) or the Free Zone authority.

10. Understand the Costs Involved

Costs vary based on jurisdiction, company type, and activity. Typical expenses include:

• Trade name registration: AED 600–1000

• Initial approval: AED 300–500

• Office rent: Depends on location and size

• License fees: AED 10,000–15,000+

• Visa fees (if applicable): AED 3,000–7,000 per person

Free Zones often offer package deals for startups and small businesses.

11. Apply for Visas (if needed)

Business owners, employees, and dependents may require residency visas. The number of visas you can apply for depends on:

• Your office space size

• Type of license

• Free Zone policies

The process includes medical tests, Emirates ID, and health insurance.

12. Open a Corporate Bank Account

After company formation, you'll need a UAE-based business bank account. Requirements include:

• Company license

• Shareholder documents

• Business plan (some banks may request this) Banks will assess risk and may take several days to approve the account.

Conclusion

Setting up a company in Dubai involves several steps but offers unmatched benefits for business growth. By understanding the process, choosing the right jurisdiction, and meeting all legal requirements, you can position your business for success in this competitive market.