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Mainland Business Setup In UAE: Key Steps And Requirements

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Mainland Business Setup In UAE: Key Steps And Requirements

United Arab Emirates (UAE) has rapidly emerged as a global business hub, attracting entrepreneurs and companies from around the world. One of the most popular options for setting up a business in the UAE is through mainland company formation. The mainland offers various advantages, such as access to the local market and the absence of restrictions on trading activities. If you are considering mainland business setup in Dubai or UAE, here are the key steps and requirements you need to know:

Business activity selection:

The first step in mainland business setup is choosing the right business activity. UAE classifies business activities into three categories: commercial, professional, and industrial. Each category has its own set of requirements and regulations, so it is crucial to select the most suitable activity for your business.

Local partner or local service agent:

Unlike free zones where foreign investors can own 100% of the company, mainland businesses require a local partner or local service agent. A local partner must be a UAE national with at least 51% ownership in the company for most activities. However, in some cases, this arrangement can be structured through side agreements to protect the interests of the foreign investor.

Legal structure and trade name:

Choosing the right legal structure is essential for your mainland business. Common legal structures include Limited Liability Company (LLC), Sole Proprietorship, and Civil Company. Each structure has its own set of liability and ownership regulations. Additionally, selecting an appropriate trade name that complies with UAE laws and reflects your business activities is crucial.

Obtaining initial approvals:

Before proceeding with the company setup, you will need to obtain initial approvals from various government authorities. These may include the Department of Economic Development (DED), the Ministry of Economy, and other relevant licensing authorities, depending on your business activity.

Memorandum of association (MOA) drafting:

Drafting the memorandum of association (MOA) is a crucial step in mainland business setup. The MOA outlines the company’s objectives, ownership structure, and responsibilities of each partner. It must be notarized by a local notary public and then submitted to the relevant authorities for approval.

Office space and tenancy contract:

Having a physical office space is mandatory for mainland businesses. You will need to secure a tenancy contract for the office space, which should comply with the rules and regulations set by the local authorities.