Attaining a Mainland Company License is an irresistible option for investors who wish to establish a new business that enables maximum trading and creates revenues. This article guides you through the in-depth analysis of the process of mainland company formation in UAE, the benefits it offers, and the challenges that you may face.
The UAE has been changing the policies for better rules to boost the economy thus bringing more investors who start a new company or a branch office. Setting up a company in the UAE involves easier and simpler steps irrespective of the emirate you choose. You can directly apply by visiting the Department of Economic Development in the emirate you wish to establish your business.
Moreover, you can access digital platforms to obtain a commercial license and establish your business online, as you can submit the required documents and get your license in a very short time. To establish a company, you need to identify a suitable location, decide on the nature of your business and pay the required fees to get your commercial license.
The experts at BMS Corporate provide the most suitable and effective solutions for a flawless business setup in Dubai and UAE.
Why Choose the Mainland over the Free Zone to Start a Business?
When considering the Mainland over the Free Zone to establish your business, you can point out various reasons! A business set up on the Mainland ensures a brighter future in business activities and professional operations.
Here are the reasons why the Mainland is advantageous in setting up your business:
Flexibility in choosing location and Zero restrictions to trade: A Mainland company is free to trade with other businesses and has no limits on the chosen location. Mainland business setup enables you to open various branches, thus building a stronger presence across the Emirates.
Broader scope: Mainland businesses have a broader working scope. If you wish to expand your services with the mainland, all you need to do is re-register the new business activity with the Economic Development Department and you can trade freely.
Access to profitable governmental contracts: A benefit for mainland business setup is the government tenders being a big business in the UAE. Being an established mainland company, you could position yourself well by taking advantage of profitable government contracts.
100% ownership control over mainland business entities: Earlier in the traditional approach, 100% foreign ownership of business entities was accessible only under these situations:
- Setting up in a free zone
- Establishing professional services company in the mainland (Sole proprietorship or Civil company)
Recently, Dubai ruler HH Sheikh Mohammed Bin Rashid Al Maktoum allowed 100% foreign ownership of mainland companies in the UAE. A 100% foreign ownership of a mainland business enables a remarkable potential for a growth-machine economy to foreign investors.
Read more about How to start a Business in Free Zones UAE
Types of Mainland Company Setup in UAE
A Mainland company is registered in the UAE Department of Economic Development (DED) which provides you with a license to start doing business in the UAE. Here are the types of mainland companies you could setup in UAE:
1. Sole Establishment
This establishment is owned by a sole proprietor to manage an economic activity (commercial, industrial, agricultural, or real estate). The financial liability of a business is related to the proprietor who should be accountable for all its financial obligations.
2. Civil Company
We ensure the complete process of establishing your Civil company or business. Our services include expert advisory, choice of local service agents, help with choosing locations- offices, organizing business plans, and handling paperwork and documentation regulations.
3. Limited Liability Companies- LLC Companies
This is the most common form of business enterprise in the UAE. This company formation requires a local sponsor, who is a UAE citizen. The Industrial and commercial licensed companies require a local sponsor and they hold at least 51% of the shares and the remaining 49% only could be held by the ex-pats.
4. Branch and Representative Office
BMS Corporate provides end-to-end solutions for the establishment of branches and representative offices in the UAE.
Here are the basic details on branches and representative offices:
- A branch office is allowed to promote and market the products of its parent entity.
- It enters the transactions and offers services to customers.
- Representative offices are allowed to promote the business activity of the parent company.
5. Joint Venture
BMS Corporate assists with the joint venture business setup requirements. We collaborate with prospective partners, set crucial directions, organize your business plan, and also deal with paperwork and documentation procedures.
6. Private & Public Shareholding Company
BMS Corporate establishes shareholding companies in UAE from the formation to the conclusion. We provide fundamental advice on company structure, choosing local partners, exclusive office locations, etc.
Mainland Company Setup Procedure
The Mainland business setup in the UAE involves several steps, including selecting a business activity, obtaining initial approval from the Department of Economic Development (DED), acquiring a trading name, renting an office space, getting approvals from relevant authorities, and obtaining a business license.
The process also requires businesses to comply with specific legal requirements, such as registering for VAT and obtaining necessary permits. Once these steps are completed, businesses can commence their operations in the UAE mainland.
While the whole company formation process in UAE Mainland may seem daunting, with the help of an experienced business setup service provider, it can be simplified and streamlined.
1. Determine the nature of the business activity
These are the economic licenses available in the UAE:
Economic licenses could include various economic activities. The nature of the business activity determines the type of license you obtain.
2. Determine the legal form of the business
Your business structure mainly depends on the requirements and determines the rules and regulations to be followed.
These are the legal forms:
- Public joint stock company (PJSC)
- General partnership
- Civil company
- Private joint stock company (PrJSC)
- Limited liability company (LLC)
- Holding companies.
- GCC company branch
- Limited partnership
- Sole Establishment
- Foreign company branch
- Free zone company branch
- Local company branch
3. Register the Trade Name
The trade name represents the company’s name, which must be unique and not be similar to any other registered company. A trade name can be applied through the Department of Economic Development in the preferred emirate, either through the website, or a mobile Application, or in person.
4. Apply for initial approval
This approval is a ‘no objection’ from the UAE government towards a specific business established in the country. The initial approval enables an investor to proceed with other steps for company formation and other authorities to issue the license. However, this is not permission for the investor to run the business or practice the business activity.
5. Get MOA or LSA Business Forms
A Memorandum of Association (MOA) is necessary when the legal form of the company is a Civil, LLC, public shareholding, or private shareholding company. On the other hand, a Local Service Agent (LSA) is necessary for a sole proprietorship.
6. Choose the Business Location
Every business in the UAE must have a physical address for operations. The company surroundings and location must be compliant with the requirements specified by the Department of Economic Development of the chosen emirate and the zoning rules and regulations of local municipalities or similar authorities, The tenancy contract for the office or warehouse space should be registered through the Ejari portal of Dubai Land Department.
7. Apply for Other Government Approvals
In certain cases, we need additional approvals from government departments controlling business activities.
These are the key economic activities requiring additional approvals:
- Ministry of Justice
- Local Municipal Department
- Telecommunications and Digital Government Regulatory Authority (TRDA)
- Executive Council
- Ministry of Economy
- Local Health departments
- Petroleum Council
8. Submit documents & collect the License
- Initial approval receipt and copies of previously submitted documents
- Lease contract copy, duly attested
- MOA as requested
- Approvals from other government authorities as requested
Documents Required to Set up a Mainland Business
These documents are required to set up a business in the Mainland, UAE:
- Application for registration and licensing, and proof of reserved trade name
- Copy of the applicant’s passport (along with residence visa details for non-GCC nationals
- No-objection letter from the current sponsor of the applicant for the non-GCC nationals
- Copy of the director’s passport, and a no-objection letter from the current sponsor of the director
- Court’s permission to conduct business, for applicants under the age of 21 years.
- Approval from government authorities based on the type of activity
- Resolution of the Board (if the partner is an existing business entity)
Documents after getting initial approval
- Receipt of the initial approval- all the documents submitted for initial approval
- Copy of office lease including plot number
- Copy of MOA duly attested by the Notary
BMS Corporate also provides the most reliable Attestation services in UAE to get your documents attested by the required authorities and help you start your business in UAE Mainland in the most streamlined way.
How to switch a Free Zone Business to a Mainland business?
To switch a Free Zone business to a Mainland business in the UAE, you need to cancel the existing Free Zone license, apply for a Mainland license with the Department of Economic Development (DED), obtain relevant visas & labor cards, register for VAT and complete the business registration process.
Switching from a free zone to a mainland is a crucial decision for the prosperity of the business. With the ideal sponsor or a business consultant, switching from a free zone to the UAE mainland is a smart and manageable step.
These are the steps to follow if you want to switch from a free zone to a mainland business:
- Cancel the existing Free Zone license.
- Choose a business activity
- Find an ideal location for your business
- Assess your business legal structure
- Get a local sponsor
- Give your company a name!
- Apply for a mainland trade license
- Obtain an office space
- Apply for visa
- Partner with a business setup consultant
Business setup in Dubai Mainland
If you are looking for guidance related to business setup in the Mainland UAE, you need not think twice- BMS Corporate will always guide you with all the requirements.
BMS Corporate has a great consulting team who understands the key risks involved in a license type and the legal actions in the business setup process. We provide a complete package of the local marketplace- which business works the best in every region and zone in the UAE.
Our Business Setup Services in UAE include all types of services to establish your business anywhere in the UAE. They are
- Mainland Company Formation in UAE
- Business Setup in UAE Free Zones
- Business Setup in Abu Dhabi Free Zones
- Offshore Business Setup in UAE
We provide a deeper insight into the most cost-effective method to set up your business by considering the best offers, packages, and comparative analysis.
Our experts are extensively knowledgeable about the recent updates in the regulations and can assess if you were professionally offering useful and ideal services.
BMS Corporate team also includes legal professionals who ‘walk the extra mile’ to ensure proper functioning and delivery of quality services on time.
1. Does UAE residents only qualify as a partner or a manager of an LCC Company?
According to the Commercial Companies Law, you need not be a resident of the UAE to qualify as a partner or a manager of an LLC Company.
2. Are there laws to protect local companies in their relationship with foreign companies?
-There are various federal laws controlling the business environment, such as the Commercial Companies Law, the Anti-Money Laundering Law, the Intellectual Property Rights Law, and the E-Commerce Law, apart from the local administrations and regulations.
3. Is it mandatory to appoint a UAE national agent for branches of foreign companies?
No. it is not mandatory to hire a UAE national agent to conduct business activities within the UAE.
4. How to establish your Business in UAE offline?
You can apply to establish your Mainland company by directly visiting one of the following offices:
- Legal services offices
- Government service centers
- Customer happiness centers affiliated with the DED in all emirates of the country
- OnTime offices for government services
- Tasheel offices
5. What are the Best Business Setup Regions in Dubai Mainland?
BMS Corporate has chosen the most suitable regions to set up your business in Dubai Mainland:
- Dubai Mainland
- Sheikh Zayed Road
- Business Bay
- Al Qusais
- Bur Dubai