How to Establish a Company in Dubai as a Foreigner
For any entrepreneur eyeing global expansion, setting up a company in the UAE—and especially in Dubai—offers an exciting opportunity.
Imagine launching your business in a city that welcomes innovation, imposes zero personal income tax, and connects you to markets across Europe, Asia, and Africa. Dubai has become a magnet for foreign investors.
But exactly what it takes for a foreigner to establish a company in Dubai might seem like uncharted territory if you’ve never done it before.
In reality, the process is more straightforward than you might think—provided you understand the key requirements and steps. Dubai’s government has streamlined many procedures to make opening a company in Dubai smooth for non-residents.
In this guide, we’ll explain the entire journey from start to finish: the options available, the step-by-step setup process, the costs involved, and how you can get help to fast-track your company formation.
By the end, you’ll know exactly how to turn your business idea into a Dubai-based company.
Key Takeaways
- Dubai is extremely foreigner-friendly: The emirate welcomes foreign investors with 100% business ownership, no personal taxes, and a range of pro-business policies.
- Mainland vs Free Zone: Foreign entrepreneurs can choose to establish a company in Dubai either on the mainland (onshore, with a Dubai Economic Department license) or in a free zone.
- Quick and streamlined setup: The process to set up a company is straightforward. You’ll need to decide your business activity, register your company name, obtain a license, and secure visas.
- Affordable startup costs: The minimum investment to start business in Dubai can be relatively low.
- Expert help pays off: Partnering with experienced business setup consultants (like CBS UAE) makes the process much easier.
Why Dubai is Ideal for Foreign Entrepreneurs
Dubai’s pro-business environment is a big reason it’s so popular among global entrepreneurs and SMEs. The city offers a combination of benefits that few other places can match:
- 100% Foreign Ownership & Investor-Friendly Policies: In the past, foreign owners needed a local Emirati partner to hold 51% of a mainland business. However, recent law changes now allow full foreign ownership of companies in most sectors.
This means you can establish a company in Dubai and retain complete control. The government actively welcomes overseas investment through initiatives like one-stop online licensing and long-term investor visas.
There are also no personal income taxes or capital gains taxes in Dubai, and the corporate tax is a low 9% on profits above a high threshold (many small businesses won’t hit that).
Plus, if you choose a free zone, you can enjoy 0% corporate tax and 100% profit repatriation as extra incentives.
- Ease of Doing Business & Infrastructure: Dubai consistently ranks among the top cities for ease of doing business. Registration procedures are efficient and often online.
English is widely used in business and government offices, so foreign investors face little language barrier.
Beyond bureaucracy, Dubai offers world-class infrastructure – from modern office spaces and co-working hubs to excellent transport and logistics networks.
You’ll also find a diverse, skilled talent pool and professional services (legal, accounting, marketing) to support your business.
In short, Dubai provides a stable, well-equipped launchpad for foreign-owned businesses to thrive.
Mainland vs Free Zone: Choosing the Right Setup
One of the first big decisions when setting up your business in Dubai is the jurisdiction: mainland or free zone.
Both are open to foreigners, but they serve different needs:
Dubai Mainland (Onshore):
A mainland company is registered with Dubai’s Department of Economy and Tourism (DET, formerly DED) and allows you to do business anywhere in the UAE market.
If you plan on opening a shop, restaurant, or providing services to local clients in Dubai, a mainland license is the way to go.
The great news for foreign owners is that you no longer need an Emirati sponsor for most businesses – 100% foreign ownership is permitted in a wide range of activities on the mainland.
Mainland companies do require you to have a physical office or shop lease in the city, and you must comply with all DET regulations and any industry-specific approvals.
Being onshore also means you can bid for government contracts and expand across the UAE easily.
In summary, the mainland option is ideal if your business targets the local Dubai/UAE market or you need maximum flexibility in where and how you operate.
Dubai Free Zones:
Free zones are special economic areas designed to attract foreign businesses with tax breaks and simplified setup.
There are dozens of free zones in the UAE (over 20 in Dubai alone), each catering to certain industries or types of business. In a free zone, foreigners can own 100% of the company and enjoy benefits like zero corporate tax, no import/export duties, and easy customs clearance.
Setup in free zones is generally quick – many have streamlined one-stop processes. The key limitation is that a free zone company is generally restricted from direct trade in the UAE mainland.
This means if you open in a free zone, your customers should be outside the UAE or within the free zone, unless you work through a local distributor or set up a branch onshore.
Free zones are perfect for businesses that are export-oriented, online-only, or want to take advantage of the specific ecosystems (e.g. tech companies in Dubai Internet City, traders in DMCC). They also often have lower cost packages for small startups.
Many foreign entrepreneurs start with a free zone company to benefit from the lower cost and simplicity, and later expand to the mainland as their business grows.
Ultimately, evaluate your customer base and growth plans: if you don’t need a storefront in Dubai, a free zone can be a cost-effective launchpad.
What Does It Take for a Foreigner to Establish a Company in Dubai? (Step-by-Step Guide)
Let’s break down exactly what it takes for a foreigner to establish a company in Dubai, step by step.
The process is straightforward and designed to be as efficient as possible:
Define your business activity and legal structure.
Start by deciding the exact business activities you want to conduct.
Dubai’s authorities have a list of over 2,000 permitted activities covering virtually every industry, so be specific (e.g. management consulting, e-commerce trading, restaurant, etc.).
Your license will be issued based on these activities (commercial, professional, industrial, etc.).
Next, choose a legal structure for your company. Most foreign-owned startups opt for a Limited Liability Company (LLC) for its flexibility and limited liability protection.
Other forms include sole proprietorship, branch of a foreign company, or civil company (for certain professions).
Selecting your activity and company type upfront will make the following steps much smoother.
Choose between mainland or a free zone jurisdiction.
As discussed above, decide where you want to register your company. If you need to engage directly in the Dubai/UAE market (hiring local staff, having a shop/office open to the public, or dealing with local clients), go with a Mainland setup under DET.
If your business is more export-oriented, online, or you want the benefits of a specialized zone, consider a Free Zone setup.
Research a few free zones that align with your industry and compare their offerings. For example, tech startups might look at Dubai Internet City, while trading companies might prefer Jebel Ali Free Zone.
Factor in costs, allowed activities, office requirements, and visa quotas for each option.
Choosing the right jurisdiction early on is crucial, as it determines which authority you’ll deal with and the regulations that apply.
Reserve a company name and get initial approval.
Pick a unique name for your company and submit it for approval to the authorities. Dubai has strict naming guidelines – the name should not duplicate an existing business, contain any offensive or religious terms, or include certain words (like “Dubai”) without permission.
Typically, you’ll provide 2-3 name options in case your first choice is taken. Once the name is approved, you will file an initial application for your business license.
For a mainland company, this is done with the DET (Dubai Economy); for a free zone, it’s with that zone’s authority.
You’ll need to submit basic documents at this stage, such as passport copies of the owner(s), and possibly a brief description of your intended business.
Secure an office or workspace address.
To establish a company in Dubai, you must have a local business address. For mainland companies, a rent agreement for an office or shop is required before final license issuance.
This can range from a flexi-desk (a shared workspace sufficient for a small team) to a full office or retail space, depending on your needs.
Free zones typically offer flexible office solutions as part of their packages – you might get a virtual desk or shared office for a lower-cost license, with the option to upgrade as you grow.
Keep in mind, the size of your workspace often determines your visa eligibility (larger offices allow you to sponsor more employees).
Securing a physical address is both a legal requirement and a practical one, as it establishes your company’s official base of operations in Dubai.
Finalize the company registration and obtain your license.
With your name approved, initial okayed, and office space arranged, it’s time to submit the full license application. This involves signing the legal incorporation documents.
For instance, LLCs will need a Memorandum of Association (MoA) prepared (outlining ownership shares and company rules) – in Dubai this can be done through legal service centers or a notary.
In the case of a mainland professional service company, you’d sign a Local Service Agent agreement (if required). You will submit all finalized documents to the relevant authority and pay the required license fees.
Once everything is in order, the authority will issue your business license. Congratulations – your company is now officially registered!
You’ll receive a trade license certificate and other incorporation papers. At this point, your company exists as a legal entity and you can start conducting business in line with the license activities.
Apply for visas (residence permits).
With a licensed company in hand, you can now obtain UAE residence visas for you and your team.
As the owner, you’re eligible for an Investor Visa (also called a partner visa) which allows you to reside in Dubai and operate your business.
You apply through Dubai’s immigration department or free zone visa services, submitting your personal documents (passport, photos, medical test results, etc.). The process includes a medical check and registering your fingerprints for an Emirates ID.
After approval, your passport gets stamped with a 2 years residence visa (renewable). You can also sponsor visas for your employees under your company (the number of visas you can get depends on your office space and the nature of your business).
Moreover, once you have your investor visa, you can sponsor family members (spouse, children, and even parents) to live in the UAE. The visa step is crucial for foreigners because it not only lets you legally live and work in Dubai, but also opens up practical benefits like renting accommodation, getting a local driver’s license, and more.
Open a corporate bank account.
The final step is to set up a business bank account in the UAE so you can smoothly conduct financial transactions.
After your company is formed (Step 5) and ideally once you have your residency visa (Step 6), you can approach local banks to open a corporate account.
Requirements vary by bank, but generally you’ll need to provide your company incorporation documents, passport and visa, a bank reference or personal profile, and sometimes a business plan or invoice samples (the banks just want to understand your business).
Dubai has many local and international banks – you can choose one that suits your needs for international transfers, online banking, etc.
The account opening process can take anywhere from a few days to a few weeks due to compliance checks. Many business setup consultants have relationships with banks and can assist in expediting this step.
Once your bank account is active, you’re all set to start operating – you can collect payments, pay suppliers, and manage your company finances with ease.
(By completing these steps, you’ve essentially covered what it takes for a foreigner to establish a company in Dubai. The entire process can be surprisingly quick – often a matter of days or a few weeks – thanks to Dubai’s efficient systems, especially if you have the right guidance.)
Minimum Investment to Start Business in Dubai
For many new business owners, a key question is: what is the minimum investment to start business in Dubai?
The good news is that you don’t need millions in capital to launch your company here. There is no official minimum share capital required to be paid upfront in most cases – the main costs are administrative and depend on the choices you make.
- Free Zone costs: If you choose a free zone, you can find startup packages that are very budget-friendly.
On the lower end, some free zones in the UAE offer simple business license setups for as little as ~AED 5,000–10,000 (these typically come with no visa or a single visa and a flexi-desk facility).
For example, an e-commerce or consulting license in a smaller free zone can be quite affordable. Of course, adding visas or office space will increase the cost.
Still, many foreign entrepreneurs are able to start a company in Dubai via a free zone with a total first-year cost well under AED 20,000, all inclusive.
- Mainland costs: Setting up a company in Dubai’s mainland generally involves higher fees, mainly because of the requirement to rent an office and the government fees for various approvals.
You should budget for the trade license cost, registration fees, and at least a small office rent (even a flexi-desk in a business center).
While costs vary by business activity, a typical mainland LLC setup with one visa might cost around AED 20,000 to AED 30,000 in the first year.
This would cover your license, initial government fees, basic office lease, immigration card, and an investor visa.
If your business needs a larger office or multiple visas, the investment will increase accordingly (for instance, a bigger retail shop and several employees could push costs higher).
- Other expenses: Beyond the setup fees, consider additional expenses like government deposits or visas (e.g. some visas require a refundable deposit), translation and legal notarization fees for documents, and professional service fees if you use a consultant.
Fortunately, Dubai’s processes are quite transparent, and a good consulting firm will outline all costs upfront so you can prepare your budget.
To put it in perspective, launching a business in Dubai can be done with a relatively moderate investment compared to other major international cities.
Bottom line: Dubai offers entry points for various budget levels. Whether you’re a solo entrepreneur looking to start lean or a growing SME with capital to invest, you can find a setup solution in Dubai that fits your pocket.
It’s wise to get a personalized quote based on your business plan to know exactly what minimum investment will jump-start your venture.
And remember, keeping compliant (renewing your license annually, etc.) is crucial, but those costs are predictable and part of doing business in this vibrant city.
Launch Your Company with Confidence (Next Steps)
Starting a business in a new country is much easier with a knowledgeable partner by your side. CBS UAE has helped countless foreign entrepreneurs successfully establish companies in Dubai, and we’re here to guide you too.
We provide end-to-end support – from selecting the right license and jurisdiction to handling all the paperwork, PRO services (government liaising), and even post-setup tasks like visa processing and bank account opening.
With our expertise, you can avoid delays or pitfalls and get your company up and running fast and in full compliance with UAE laws.
If you’re ready to take the next step, book a free consultation with our team today. We’ll discuss your business goals and outline clearly what it takes for a foreigner to establish a company in Dubai in your specific case.
Our consultants will craft a tailored roadmap and cost breakdown for you, so you know exactly what to expect.
Contact us now and let’s get your UAE business started! We’ll handle the heavy lifting, while you focus on growing your venture in Dubai’s thriving market.
