Required qualifications for entrepreneurship in the UAE
Small and medium-sized enterprises in the UAE, which account for 98% of all, are this country’s backbone. Entrepreneurs must meet the entrepreneurial conditions in the UAE to obtain a UAE start-up visa. They must have innovative ideas and a professional team to get started, and they must also have the necessary information about the required documents. Start-up companies need seven essential documents to avoid high costs as their business grows:
- Business license: A business license is like a birth certificate for a company. The business license has three pages. There are the company’s legal name, legal activity type, issue and expiration date, license number, registration number, company address, and contact details on its first page. Besides, there are the partners’ details such as name, nationality, and partners’ share percentage on the second page. The third page contains information about the company’s capital.
- Company Bylaws: The most critical legal document of any company is the company bylaws, which define how a company is run, and the duties and responsibilities of the company’s chief members, including the directors’ board.
- Establishment Card: It is another crucial document in operating a business in the UAE. This card allows a company to obtain a visa for its immigrant staff. The companies cannot apply for a visa for their foreign employees if they don’t have this card. They must register with the General Directorate of Residency and Foreign Affairs to receive the company’s establishment card.
- Non-Disclosure Agreement: Companies need to protect information such as customer lists, pricing schedules, etc.
- Employee contracts: Companies must arrange employment contracts for their employees. Employee contracts are signed and registered with the Ministry of Labor.
- Trademark Registration Certificate: Entrepreneurs must obtain a trademark registration certificate at the Ministry of Economy’s trademark offices to receive exclusive rights to the trademark logo or company name.
- Asset protection: It is recommended to protect the company’s assets, which must be in line with the United Arab Emirates laws.
In the Comments section, you can also ask your questions and answer them in a short time.
Topics reviewed in this article:
Required documents to register a company in the UAE
- Public documents: License form completion, copy of the business plan, notarized memorandum, copy of the managers and partners’ passport
- Copy of the educational degree
- Study of business feasibility
- Existing company profile
- Complete the appropriate investment project specification form
- Copy of registration certificate, memorandum, and association articles
- The main resolution of the directors’ board guarantees the branch’s financial commitment.
- A legal representative’s power of attorney and a copy of their passport
- The parent company’s bank statements for the last three months
Standards and indicators affecting investment in the UAE
Entrepreneurs who intend to invest in foreign countries as international immigrants must know the investment characteristics and standards and be aware of the investment risk in that country. Investment standards include property confiscation and corruption rates. The investment indicators include unemployment rates, bank interest rates, investment growth, GDP, and inflation.
- Property confiscation: Property confiscation is examined between two digits of one to seven. The closer the state property confiscations number is to one, the lower the investment risks will be. The closer this rate is to seven, the higher the investment risk in that country will be.
- Corruption control rate: Another essential investment factor is the corruption control rate. The closer this index rate is to + 2.5, the safer the investment will be in that country. But the closer it is to -2.5, the more insecure the country becomes in terms of investment.
Types of entrepreneurship in the UAE
Entrepreneurship in the UAE is possible in different types of companies, which are listed below:
- Exclusive ownership: It belongs to one person who has control over all its activities. It is the simplest companies’ structural form in the UAE, and foreign entrepreneurs can establish a company only with a residence permit in the UAE.
- Limited Liability Company: This type of company is most in demand for entrepreneurs in the UAE. No participation capital is foreseen in this type of company. The applicant must have sufficient share capital to establish a limited liability company, which is decided by the shareholders of the company.
- Private joint-stock Company: This type of company consists of at least three investors with a minimum capital of 5,000,000 dirhams. The Ministry of Economy must approve the establishment of a specific joint-stock company.
- Public joint-stock company: This type of company is defined as a legal entity and is formed with a minimum capital of 30,000,000 dirhams.
- Civil company: Well-known professions such as a doctor, accountant, engineer, and lawyer can establish a public company.
- Joint companies: In this type of company, ownership is divided by two or more partners whose profits and losses are divided based on their share.
- Branch of a foreign company: Companies can open a branch in the UAE. The branch is obliged to do business with its parent company.
How to start a business in the UAE
Entrepreneurs who want to start a business in the UAE should consider the following steps.
- Decide what goods or products to offer: The first step to becoming an entrepreneur in the UAE is for the entrepreneurs to decide what product or service they offer. Entrepreneurs can offer a product that leads to fierce competition in the UAE market or look for a product or service that is not available in the UAE market.
- Offer a solid business plan: A solid business plan is the entrepreneurial activity foundation in the UAE. If entrepreneurs want to enter the UAE competitive market, they need a suitable business plan, and they must consider its every detail widely.
- Provide the necessary funding to start a business: Entrepreneurs must determine their investment capital. Various banks in the UAE offer commercial loans to start-ups.
- Specify the license type
A business license depends on the business type. There are three types of permits:
- Business License: For commercial activities
- Industrial license: for manufacturing or industrial activities
- Professional License: For service providers and business professionals
Entrepreneurs must obtain a business license from the Ministry of Economic Development.
- Identify business costs: Entrepreneurs’ business costs depend on the amount of work and the region in which they plan to start their business.
- Consider the time it takes to start a business: Depending on the jurisdiction, whether in the central area or the free zone, it usually takes about seven to ten days to start a business in the UAE.
Obtaining residence in the UAE by registering a company
The United Arab Emirates is an oil-rich country and an economic hub in the Middle East. In some free trade zones in the UAE, the tax is free. Entrepreneurs who have a UAE start-up visa and meet the entrepreneurship conditions in the UAE can apply for a Dubai entrepreneurial residence by registering a company in this country and pay a minimum of 5,000,000 dirhams for a five-year residency and 10,000,000 dirhams to reside in the UAE for ten years. On the other hand, investors who invest at least 1,000,000 dirhams in the UAE by buying a property can stay in the UAE for three years with their family members. Of course, this type of residence can be extended. It means that they must reside in the UAE for at least 180 continuous days. Besides, the applicants can obtain citizenship in the UAE only by birth and marriage to a UAE citizen, not with investment.
Leave a Reply
Want to join the discussion?Feel free to contribute!