Start Your Business in United Arab Emirates
Why Choose United Arab Emirates to open a Business?
Entrepreneurs and companies are increasingly drawn to the UAE’s dynamic and business-friendly environment. With a wide range of options for company formation and corporate restructuring, the UAE offers strategic advantages for businesses of all sizes. This guide outlines the key benefits of establishing a presence in the UAE, along with an overview of the various business structures available.
Gateway to growing markets
Located at the crossroads of Europe, Asia, and Africa, the UAE offers unmatched access to some of the world’s fastest-growing markets. Renowned for its innovation and forward-thinking infrastructure, the country has become a magnet for international businesses looking to leverage its geographic advantage. As a result, the UAE has emerged as a major global hub for trade, commerce, and investment.
Diversified and strong economy
The UAE has made significant strides in reducing its dependence on oil and gas through sustained economic diversification. By fostering a knowledge-based, innovation-driven economy, the country continues to achieve steady GDP growth. Its strong credit ratings from globally recognized agencies highlight the federal government's financial stability and sound economic management. This robust and diversified economic landscape offers a welcoming environment for businesses across a wide range of industries.
Business-friendly policies
According to the Global Startup Ecosystem Report, Dubai, Abu Dhabi, and Sharjah of the UAE are among the top ten startup ecosystems in the Middle East and North Africa region. The UAE has introduced several policies to provide funding for entrepreneurial projects, ease of market entry, access to financing and knowledge transfer. Registering a business in UAE is a seamless process with increasing government support.
Competitive tax solutions
The UAE’s new corporate tax regime is designed to minimize the compliance burden on businesses while maintaining global competitiveness. With a proposed corporate tax rate of just 9%—significantly lower than the global average of 23.5%—the UAE remains one of the most tax-friendly jurisdictions in the world. Additionally, there is no personal income tax on individuals, and the country maintains liberal tax policies, including no restrictions on capital repatriation and no currency exchange controls. These factors make the UAE an attractive destination for new businesses and investors alike.
A transparent banking system
The UAE’s banking sector plays a vital role in supporting the growth of small and medium enterprises (SMEs) and larger companies alike. With a strong emphasis on digital transformation, transparency, and customer-focused services, the sector continues to attract both local and international businesses. UAE banks offer a wide range of tailored financial solutions, including flexible loan programs, competitive interest rates, and customized credit facilities—designed to meet the unique needs of entrepreneurs and growing enterprises.
Easier succession planning for family businesses
The UAE actively fosters a secure and enabling environment for family-owned enterprises, recognizing their vital role in economic growth. In 2023, the Dubai International Financial Centre (DIFC) introduced the Family Arrangements Regulations to support effective succession planning and legacy preservation. Operating under a unique regulatory framework based on English Common Law—independent of both civil and Sharia law—the DIFC offers an attractive platform for family businesses. Certification and accreditation programs under the UAE Family Business Law provide additional benefits, helping ensure the long-term sustainability and success of family enterprises across the region.
Multiple residency options
Robust legislative environment
The UAE is committed to building a secure, transparent, and business-friendly environment through continuous development of its legislative systems. By investing in a flexible and forward-thinking legal framework, the country ensures it can adapt to evolving global standards and emerging business trends. These efforts contribute to a stable, safe, and equitable environment for investors and entrepreneurs alike.
Business Structures In The UAE
It is important to select the appropriate type of business structure when setting up a company in the UAE. This choice affects your company’s legal ownership and operational flexibility.
A mainland company is an onshore entity that operates within the UAE and internationally. It is registered with the relevant Emirate’s Department of Economic Development, which issues its trade license. Mainland companies have no restrictions on commercial activities; they may, however, require a local sponsor or UAE national partner for specific business activities. No minimum capital requirement exists, and the number of visas issued depends on the size of the office space.
Mainland companies can trade across the UAE and participate in government contracts. All mainland companies must maintain a register of their Ultimate Beneficial Owners (UBO) and submit this information to the relevant registrar or licensing authority. There is, however, no public registrar of directors, shareholders or UBOs.
While incorporating a company on the mainland, you can select the following legal structures aligned with your intended business activities.
A limited liability company (LLC) is the most common type of business structure. It requires at least two partners (with a maximum of 50). Each partner’s liability is limited to their share in the capital, and negotiable instruments do not represent these shares. LLCs can operate anywhere in the UAE and the Gulf Cooperation Council (GCC).
A public joint-stock company (PJSC) requires at least five shareholders. Its capital is divided into equal, negotiable shares. Founders initially receive a portion of these shares, while the remaining shares are offered to the public. Shareholders’ liability is limited to their investment in the company’s capital. A PJSC allows for the buying and selling of shares, making it ideal for businesses seeking to raise capital from the public. This type of company suits larger firms, including those wishing to list on a stock exchange.
A private joint-stock company (PrJSC) in the UAE allows shares to be privately bought and sold among a limited number of shareholders, capped at 200. The company’s capital gets divided into shares of equal nominal value. If one person owns a PrJSC, it is called a ‘private joint-stock company – single ownership’. In this structure, the owner’s liability is limited to the capital specified in the company’s Memorandum of Association.
A foreign branch office is an extension of the parent company that can perform contracts and other specified activities locally. This setup allows businesses to retain 100% foreign ownership. The branch operates under the same name and business activities as the parent company but must lease office premises.
While a branch doesn’t have capital requirements, a UAE bank guarantee of AED50,000 must be deposited in a UAE bank licensed by the Central Bank of UAE. The bank guarantee must be deposited during or within 30 days of license issuance. The foreign branch must maintain the bank guarantee untouched until the branch is de-registered.
A representative office in the UAE functions primarily as a cost centre and focuses on marketing and promotional activities for the foreign parent company. It is restricted to gathering information, conducting market research, and soliciting orders or projects for the parent company. The business registration process and requirements for establishing a representative office are like those for a branch office, ensuring alignment with local regulations.
A sole proprietorship in the UAE allows a single individual to own 100% of the business. Although the business is registered as a separate legal entity from its owner, the owner is personally liable for all financial obligations and liabilities incurred by the business.
UAE Free Zone Companies
The UAE has more than 45 free zones with unique registration requirements. These zones offer an alternative to onshore setups, allowing 100% foreign ownership. Each free zone operates under its own regulatory authority, which issues licenses and governs business activities.
These licenses also allow businesses to engage with customers outside the zone. They can be registered with a single shareholder and director, who may be a foreigner and not a resident of the UAE. Free zone entities must secure office or industrial space within the zone.
While incorporating a company in the free zone, you can choose the following legal structures aligned with your intended business activities.
A legal entity incorporated/registered by a single shareholder, who can either be an individual or a corporate entity.
A legal entity incorporated/registered with at least two shareholders, who can be individuals or corporate entities.
Companies not intending to conduct business within the UAE can establish an offshore entity. These entities often serve as holding companies and do not engage in commercial activities. They can open a UAE bank account but cannot obtain a tax residency certificate.
They are typically used for international trading, consulting, or owning assets. There is no minimum share capital requirement for these entities. They cannot sponsor visas, import/export products, or invoice UAE clients.
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