How to Set Up a Company in Dubai?

17 May 2025

By Vista Corp

Why Set Up a Company in Dubai?

Dubai has rapidly become one of the most attractive business hubs in the world, and for good reason. Entrepreneurs and investors from around the globe are setting up companies in Dubai to tap into its unmatched advantages. First, the city offers strategic geographic positioning between East and West, making it a global trade and logistics gateway. This access to emerging markets in the Middle East, Africa, and South Asia is a major draw for international businesses. One of the most significant benefits is 0% personal income tax and favorable corporate tax laws—especially for Free Zone and small-scale businesses. Add to that the UAE’s robust infrastructure, world-class transport networks, and innovation-driven economy, and the appeal becomes even stronger. Dubai also ranks high for ease of doing business, thanks to digitalized government processes, streamlined licensing, and investor-friendly policies such as 100% foreign ownership in many sectors.

With the launch of initiatives like Dubai Economic Agenda D33 and the UAE’s “Projects of the 50,” the emirate is making bold moves to attract over AED 700 billion in foreign investment. Whether you’re starting a tech startup, consultancy, e-commerce store, or a trading company, Dubai offers a scalable and future-proof environment for growth in 2025 and beyond.

Types of Company Structures in the UAE

When you’re planning your business setup in Dubai, choosing the right company structure is one of the most critical decisions. The UAE offers multiple legal structures depending on your business goals, capital, ownership preference, and whether you plan to operate locally or internationally. The three main options are Mainland, Free Zone, and Offshore companies.

Each structure comes with its own set of benefits, regulatory requirements, and scope of operation. A Mainland company in Dubai gives you access to the UAE local market without restrictions and allows government contracts. A Free Zone company, on the other hand, offers 100% foreign ownership, tax exemptions, and ease of incorporation—ideal for startups and international firms focusing on import-export or online services. Meanwhile, Offshore companies in the UAE are best suited for holding assets, international business, and wealth protection, but they cannot trade within the UAE.

Understanding these options is key to setting up your company legally and profitably. Each jurisdiction has its own authorities and costs, so it’s vital to align your choice with your long-term strategy, customer base, and capital flow. In the next sub-sections, we’ll dive into the details of each structure to help you decide what’s best for your company setup in Dubai.

Mainland Company Setup in Dubai

A mainland company in Dubai is a business entity licensed by the Department of Economy and Tourism (DET) (formerly DED) that allows you to operate across the entire UAE and beyond without restrictions. It’s the ideal setup if you want to trade directly within the UAE market, bid for government projects, or open retail outlets and service offices throughout the Emirates.

One of the biggest updates in recent years is that 100% foreign ownership is now allowed for many activities, removing the need for a UAE national sponsor (except in a few regulated sectors). This makes mainland setup highly attractive to foreign investors. You can choose from a wide range of legal structures such as LLC (Limited Liability Company), Sole Establishment, or Civil Company, depending on your business model.

Setting up a mainland company requires a physical office space (Ejari registered), an initial approval, trade name reservation, and a Memorandum of Association (MoA). After that, you apply for your trade license and can begin operations. While costs are generally higher than Free Zone setups, the unlimited trading freedom within the UAE and broader market access make this a strong option for businesses with local expansion goals.

Free Zone Company Setup in Dubai

A Free Zone company in Dubai is often the go-to choice for startups, digital entrepreneurs, and foreign investors looking for a cost-effective and quick entry into the UAE market. Dubai hosts over 30 Free Zones, each tailored to specific industries—such as tech, media, trading, logistics, education, and finance. Popular Free Zones include IFZA, DMCC, Dubai South, and Dubai Internet City.

The biggest advantage? 100% foreign ownership, no customs duties on imports/exports within the zone, and zero personal income tax. Many Free Zones also offer multi-year license packages, flexible desk or shared office options, and simplified visa processing. This makes them ideal for solopreneurs, consultants, and small to medium-sized enterprises (SMEs). Additionally, Free Zones often don’t require you to be physically present in Dubai to incorporate your business—making remote setup easy.

However, Free Zone companies are restricted from directly trading in the UAE mainland. You’ll need to appoint a local distributor or open a branch with a mainland license for that. Still, for companies focused on e-commerce, international trade, or virtual services, the Free Zone setup offers exceptional value and operational ease. It’s one of the most affordable and flexible ways to start a business in Dubai in 2025.

Offshore Company Formation in the UAE

An offshore company in the UAE is a legal business entity established primarily for international operations, asset protection, and tax optimization. It’s not designed for conducting commercial activity within the UAE but is excellent for holding companies, real estate investments, IP protection, and international trading. Offshore companies cannot lease office space or apply for UAE residency visas but offer high levels of confidentiality and financial flexibility.

The three main offshore jurisdictions in the UAE are JAFZA Offshore, RAK ICC, and Ajman Offshore. Among these, RAK ICC (Ras Al Khaimah International Corporate Centre) is widely preferred for its low setup cost, speed of incorporation, and access to double taxation treaties through corporate structuring. Offshore companies in these jurisdictions are governed by common law principles and offer 100% foreign ownership with no corporate taxes on income earned outside the UAE.

To set up an offshore company, you typically need to appoint a registered agent, submit passport copies, and provide details about the business activity and ownership. Offshore setups are ideal for businesses that want to open global bank accounts, own shares in UAE companies, or structure their international operations more efficiently. While not suitable for retail or service businesses inside Dubai, offshore formation is a strategic tool for global entrepreneurs.

Steps to Set Up a Company in Dubai

Setting up a company in Dubai involves a clear step-by-step process, whether you’re opting for a mainland, free zone, or offshore structure. While the specific requirements may vary depending on jurisdiction and business activity, the general procedure is fairly streamlined. Here’s a comprehensive breakdown of the company setup process in Dubai.

1. Choose the Right Jurisdiction

The first step is to decide between mainland, free zone, or offshore based on your target market, budget, and licensing needs.

• Mainland is best for businesses wanting to trade across the UAE.
  
• Free Zone suits international trading, services, and e-commerce.
  
• Offshore is ideal for asset holding and international operations.
  

Consulting a business setup advisor can help you match your goals with the right jurisdiction.

2. Define Your Business Activity

You’ll need to select from over 2,000 licensed activities listed by the UAE authorities. These fall into categories like:

• Commercial (trading, real estate, etc.)
  
• Industrial (manufacturing, production)
  
• Professional (consulting, legal, IT)
  

Make sure your chosen activity is allowed in the jurisdiction you picked, as some zones specialize in specific sectors.

3. Choose a Company Name

The UAE has strict naming guidelines:

• Avoid religious terms, country names, or offensive words.
  
• No abbreviations if the name includes the owner’s name (e.g., use “John Smith Consulting” instead of “J.S. Consulting”).
  
• The name must not duplicate any existing business names.
  

You’ll need to reserve the name with the relevant authority (like DED or a free zone registrar).

4. Apply for Initial Approval

Once your activity and name are approved, you can apply for initial approval. This is essentially a green light from the authorities to proceed. You’ll typically need:

• Passport copies of shareholders
  
• Visa page or entry stamp (if in the UAE)
  
• No Objection Certificate (NOC) if you’re a resident sponsored by another employer
  
• Business plan (for some activities)
  

This step is usually completed within 1–2 business days.

5. Draft the MoA or LSA Agreement

• Mainland LLCs require a Memorandum of Association (MoA), outlining company ownership, roles, and capital distribution.
  
• If you’re setting up a professional license, a Local Service Agent (LSA) agreement may be needed instead.
  

For Free Zone and Offshore setups, an MoA may still be required, depending on the zone and activity.

6. Choose a Business Location

You must lease office space to register your company.

• Mainland businesses must obtain an Ejari (tenancy contract).
  
• Free Zones often offer shared desks, flexi-desks, or private offices.
  Your location should align with the type of license and size of the team you plan to hire.
  

7. Apply for the Business License

This is your official trade license issued by DED (for mainland) or the respective free zone authority. The type depends on your activity:

• Commercial License – for trading and sales
  
• Professional License – for consultancy or services
  
• Industrial License – for manufacturing
  
• Tourism License – for travel agencies, operators
  

Once your documents and approvals are ready, the license is typically issued in 3–5 days.

8. Process Visa and Emirates ID

As a business owner, you can apply for an Investor Visa (valid for 2–10 years). You’ll need:

• Entry permit
  
• Medical test
  
• Emirates ID application
  
• Biometrics
  

You can also apply for visas for employees, partners, or family members depending on your visa quota.

9. Open a Corporate Bank Account

Opening a business bank account in the UAE is essential.
Documents typically include:

• Trade license
  
• MoA
  
• Shareholder passport copies
  
• Proof of address and company profile
  

Popular banks include Emirates NBD, RAKBANK, and Mashreq. Some free zones have tie-ups with banks for faster processing.

Costs of Setting Up a Company in Dubai

Understanding the cost of setting up a company in Dubai is crucial for budgeting and long-term planning. The total cost depends on several variables including jurisdiction, type of license, number of visas, office space, and optional add-ons like legal support or PRO services.

Here’s a rough breakdown:

Many Free Zones offer low-cost setup packages starting from AED 11,999, which may include license, shared office, and visa quota. Mainland setups, while more flexible for local operations, can go upwards of AED 25,000–35,000, depending on office location and activities.

Also, be aware of hidden costs like immigration card fees, establishment card, attestation charges, and VAT registration (if applicable). It’s smart to request a full quotation breakdown when comparing business setup packages.

Documents Required for Company Registration

Whether you’re opting for a mainland, free zone, or offshore company setup in Dubai, preparing the correct documentation is key to avoiding delays and legal issues. While specific requirements vary slightly across jurisdictions, most business setups in the UAE will require the following documents:

🔹 Basic Documents for Individual Shareholders:

• Passport copy (must be valid for at least 6 months)
  
• Visa copy (if you are already in the UAE)
  
• Entry stamp or Emirates ID copy (if available)
  
• Passport-size photograph (with white background)
  

🔹 If You’re a UAE Resident:

• NOC (No Objection Certificate) from current sponsor
  
• Copy of Emirates ID
  
• Resident visa page copy
  

🔹 Corporate Shareholder Documents (if applicable):

• Certificate of Incorporation
  
• Board Resolution authorizing the investment
  
• Memorandum & Articles of Association
  
• Valid Business License copy
  
• Power of Attorney (if appointing a legal representative)
  

🔹 Other Requirements:

• Trade name approval certificate
  
• Initial approval receipt
  
• Tenancy contract (Ejari) or office lease agreement
  
• Memorandum of Association (MoA) or LSA Agreement
  

Some Free Zones simplify the process by offering one-window solutions where documents can be submitted digitally. However, notarized and attested documents may still be required for certain licenses or offshore setups. It’s advisable to get document preparation reviewed by a licensed business consultant in Dubai to ensure accuracy and completeness.

How to Set Up a Trading Company in Dubai

Setting up a trading company in Dubai is one of the most popular and profitable options for entrepreneurs entering the UAE market. Whether you plan to deal in electronics, textiles, food items, or auto parts, Dubai offers world-class infrastructure, port access, and a robust regulatory framework for import-export businesses.

🔹 Step-by-Step Process to Start a Trading Business:

1. Choose the Jurisdiction:
   Decide between a mainland trading license (through the Department of Economy & Tourism) or a Free Zone license (like DMCC, IFZA, or RAKEZ) depending on your target market. Mainland gives you unrestricted access to the UAE market, while Free Zones are more cost-effective for international trade.
   
2. Select Business Activities:
   You can apply for a General Trading License (multiple product categories) or a specific trading license (focused on a certain product type like garments or electronics).
   
3. Reserve Your Trade Name and Get Initial Approval:
   Submit your trade name and business activity for approval through the relevant authority.
   
4. Apply for the Trade License:
   Submit necessary documents (passport copies, MoA, tenancy contract, etc.).
   A General Trading License typically ranges from AED 15,000 to AED 35,000, depending on the zone and services.
   
5. Obtain Import/Export Code from Dubai Customs:
   Mandatory for businesses engaged in cross-border trading. Apply online at Dubai Customs.
   
6. Set Up a Warehouse or Logistics Partnership (if needed):
   For large-scale trading, warehouse space or fulfillment centers might be required. Free Zones offer warehousing options, while mainland companies need to lease storage space and register accordingly.
   
7. Open a Corporate Bank Account:
   Provide your trade license, customs code, invoices, and KYC documents. Some banks require physical presence for verification.
   
8. Register for VAT (if applicable):
   If your annual turnover exceeds AED 375,000, you must register with the Federal Tax Authority.
   

✅ Pro Tip:

If you plan to deal in regulated goods like food, cosmetics, or medical products, you may also need product registration with Dubai Municipality or other specific authorities.

Setting Up a Company in Dubai Without Money – Is It Possible?

Starting a company in Dubai with little or no upfront capital may sound unrealistic—but it’s more possible today than ever before. Thanks to government incentives, flexible Free Zone packages, and financing options, aspiring entrepreneurs can launch a business in Dubai even on a tight budget.

🔹 1. Use Zero-Upfront or Installment-Based Packages

Several Free Zones, such as IFZA, SHAMS, and SPC Free Zone, now offer business setup packages starting from AED 5,750 to AED 11,999 with the option to pay in monthly installments. These packages often include:

• Trade license
  
• Lease agreement (Flexi-desk)
  
• Visa quota
  
• Establishment card
  

This model eliminates the need for large upfront payments and gives you room to start earning while building your business.

🔹 2. Explore Startup Incubators and Accelerators

Dubai is home to numerous incubators and government-backed initiatives like:

• in5 Tech and Media
  
• Dubai Future Accelerators
  
• Mohammed Bin Rashid Innovation Fund
  

These platforms provide funding, mentorship, and sometimes office space for free, in return for equity or business performance milestones.

🔹 3. Consider Freelance Permits or E-Trader Licenses

If your business is service-based (e.g., graphic design, consulting, marketing), consider:

• Dubai E-Trader License (ideal for home-based business)
  
• Freelance License (starting from AED 5,500 in some zones)
  

These allow you to start lean without office space, with just a laptop and internet connection.

🔹 4. Crowdfunding or Investor Pitching

Platforms like Eureeca, Beehive, or even angel networks can help you pitch your business idea in exchange for early-stage funding. Many investors look for UAE-based startups with strong scalability potential.

✅ Conclusion:
Yes, you can set up a business in Dubai without much money, if you take a lean approach. Leverage Free Zone offers, digital permits, and funding channels to start small and grow smart.

Best Locations to Set Up a Company in UAE (2025)

Choosing the right location for your company setup in the UAE can greatly influence your cost, speed to market, and ability to scale. From premium commercial hubs in mainland Dubai to specialized free zones across the Emirates, there’s a setup solution for every business type and budget.

🔹 Mainland Business Districts in Dubai

For companies that need direct access to the local UAE market, consider these areas:

• Business Bay – Central, modern offices, ideal for consultancies and financial firms.
  
• Deira or Al Qusais – Budget-friendly areas for trading and service-based companies.
  
• Al Quoz & Ras Al Khor – Suitable for industrial or logistics businesses with warehouse needs.
  

These locations require Ejari-registered tenancy contracts, but offer unrestricted business activity across the UAE.

🔹 Top Free Zones in Dubai (2025)

Free zones are ideal for 100% foreign ownership and tax savings. Top picks include:

🔹 Free Zones in Other Emirates (Cost-Effective)

These locations offer cheaper packages and less bureaucracy:

• RAKEZ (Ras Al Khaimah Economic Zone) – Ideal for industrial units and low-cost licenses
  
• SHAMS (Sharjah Media City) – Perfect for media startups, consultants
  
• SPC Free Zone (Sharjah Publishing City) – Offers instant license issuance
  
• Ajman Free Zone – Competitive pricing for small traders and freelancers
  

🔹 Abu Dhabi Business Hubs

Abu Dhabi’s free zones like ADGM (Abu Dhabi Global Market) and twofour54 cater to finance and media sectors, offering world-class infrastructure and strong international legal frameworks.

✅ Tip: If budget is a concern, start in a cost-effective Free Zone and upgrade to a mainland license as your business grows.

Business Setup Services in Dubai – Should You Use One?

Setting up a company in Dubai is much easier today than it was a decade ago—but that doesn’t mean it’s entirely hassle-free. That’s where business setup services in Dubai come in. These licensed consultants help navigate everything from licensing and visa applications to bank account setup, letting you focus on your actual business rather than the paperwork.

🔹 Top Advantages of Using a Business Setup Consultant

1. Saves Time and Reduces Errors
   Setup advisors are familiar with every step, ensuring your application is complete, correct, and fast-tracked. One missing document can delay your license by weeks—an experienced consultant avoids this.
   
2. Tailored Jurisdiction and License Advice
   They help you choose the right Free Zone, Mainland authority, or Offshore structure based on your industry, budget, and goals.
   
3. Banking, Visa, and PRO Support
   Consultants typically have direct relationships with UAE banks, easing the account-opening process (which can be tricky for foreigners). They also handle residency visas, Emirates IDs, and labor approvals.
   
4. Ongoing Compliance and Renewal Reminders
   You’ll also benefit from reminders on license renewals, VAT returns, and document updates, reducing your legal risks.
   

🔹 How to Choose the Right Setup Company in Dubai

• Check licensing and government recognition
  
• Ask for transparent cost breakdowns (avoid vague “starting from” packages)
  
• Look at client testimonials and Google reviews
  
• Avoid consultants who pressure you or promise unrealistic timelines
  

✅ Conclusion:
Using a business setup company in Dubai can save you time, money, and legal complications. It’s especially helpful if you’re a first-time founder or a foreign investor unfamiliar with UAE laws.

Common Challenges and How to Overcome Them

While Dubai offers a business-friendly environment, entrepreneurs still face several challenges when setting up a company in the UAE. Understanding these obstacles—and knowing how to overcome them—can save you both time and money.

🔹 1. Choosing the Wrong License or Jurisdiction

One of the most frequent issues is selecting a license that doesn’t cover your actual business activity, or picking a Free Zone that limits your ability to scale locally.
Solution: Always consult with a licensed setup advisor and get clarity from the issuing authority before applying.

🔹 2. Corporate Bank Account Rejections

Many foreign-owned startups struggle to open a business bank account in Dubai due to strict KYC/AML policies. Banks may reject your application if your documents aren’t comprehensive or if your business model seems unclear.
Solution: Prepare a proper business plan, maintain transparency, and consider banks that are startup-friendly (like RAKBANK or WIO).

🔹 3. Delays in Visa Processing

Investor and partner visas can be delayed if medicals, entry permits, or Emirates ID appointments are missed or incorrectly filed.
Solution: Work with a business setup firm or PRO service provider to handle document submissions and scheduling.

🔹 4. Language and Legal Barriers

Legal documents like MoA, LSA agreements, or tenancy contracts can be difficult to understand if you’re unfamiliar with UAE commercial law.
Solution: Hire a bilingual consultant or legal translator to explain documents before signing anything.

🔹 5. Unexpected Costs or Renewals

First-time entrepreneurs often overlook renewal costs (license, establishment card, visas), leading to fines or cancellations.
Solution: Maintain a renewal calendar and account for recurring costs in your financial plan.

✅ Remember: Every setup challenge in Dubai has a clear solution—it’s all about knowing the system or working with those who do.

FAQs – Company Setup in Dubai

1. Can I start a business in Dubai as a foreigner?

Yes, foreigners can fully own a company in most Free Zones and for many Mainland activities, especially after the 2021 reform. You do not need a local sponsor for most business types, and remote setup is also possible.

2. What is the cheapest way to set up a business in Dubai?

Free Zones like IFZA, SHAMS, and SPC offer low-cost packages starting from AED 5,750. These packages may include trade licenses, shared office space, and visa quotas, making them ideal for freelancers or startups.

3. How long does it take to register a company in Dubai?

Company registration in Dubai typically takes 2 to 5 working days. Some Free Zones even offer instant licenses within 1 business day, while Mainland setups may take a few days longer depending on documentation.

4. Is a physical office required to set up a company in Dubai?

Yes, for Mainland businesses, a physical office with an Ejari contract is required. Free Zones, however, allow Flexi-desk or virtual office options, which are cost-effective for small or service-based businesses.

5. What is the difference between Mainland and Free Zone companies?

Mainland companies can trade anywhere in the UAE without restrictions. Free Zone companies enjoy 100% ownership and tax benefits but are limited to operating within the zone or internationally unless a local distributor is appointed.

6. Can I set up a business in Dubai remotely?

Yes, many Free Zones allow full remote company formation. With the right documentation and a registered agent, you can complete the setup, licensing, and even visa processing without physically visiting Dubai.

Final Thoughts – Is Dubai the Right Place for Your Business in 2025?

If you’re asking whether Dubai is the right place to start your business in 2025, the answer is a confident yes. With a thriving economy, investor-friendly regulations, world-class infrastructure, and zero personal income tax, Dubai continues to be a top global destination for entrepreneurs. Whether you’re starting a tech startup, launching a trading firm, or opening a consulting agency, Dubai offers an ecosystem that’s designed for growth.

Thanks to regulatory reforms like 100% foreign ownership, multi-year visa options, and digital company registration, launching a business has never been easier. You can choose from a wide range of company structures—mainland, free zone, or offshore—and customize your setup based on your target market and budget.In 2025, Dubai’s “D33 Economic Agenda” and UAE-wide strategic initiatives are opening up vast opportunities across sectors like real estate, finance, tourism, technology, logistics, and e-commerce. If you’re serious about starting or expanding a business in the region, the time to act is now.