Setting Up Business in Dubai: The Legal Help You’ll Need

Dubai is an exciting cosmopolitan city. It is home to people of over 200 nationalities, and attracts millions of tourists each year from all over the globe. Its reputation for innovation and growth, as well as its free market philosophy, means that it is an enticing place for entrepreneurs.

The Dubai government is keen that the emirate continues in its growth as one of the world’s leading business hubs. The good news for those starting a business here is that the government is committed to reducing unnecessary bureaucracy; hence, its licensing procedures are duly streamlined.

The Department of Economic Development (DED) is dedicated in its mission to attract foreign investment by making it as easy as possible to start a successful business here. However, despite this, you will still need some legal help in starting a business in a Dubai free zone or in the city itself.

You will need to ensure your business gets off to a good start and on the right side of local laws. Prevention is always better than cure in this respect, and legal assistance will help you identify potential legal problems before they occur. Good legal advice will also help you make sound, cost-effective decisions.

Here are some of the areas where you may require legal help:

Licensing Agreements

All business activities in Dubai require a license. Licenses are issued by the DED or a free zone authority, if applicable to your business. There are several different licenses issued by the DED and licensing arrangements vary between the different free zones, too.

Certain regulated activities may require further and additional licenses from bodies such as the National Media Council, the Central Bank or the Ministry of Finance.

By seeking legal advice, you can be sure you are operating with the correct licenses for your business type.

Business Structure

It is important you seek professional legal advice when it comes to finalizing your business structure. There are a number of business structures available to a foreign investor in Dubai. Ensuring that you choose the right one is important in protecting your investment and in gaining fair returns.

If you intend to be the sole proprietor of your business you will find that procedures vary according to your nationality, residency status and the services you wish to provide. Similarly, the various corporate forms have varying requirements. Branch offices of foreign companies also require the issuance of a branch license from the DED in order to operate.

A reputable law firm will explain the options available to you and help you set up a business that is both legally compliant and that works with your business goals in mind.

Employment Law

Dubai employment relations are governed by Federal Law No. 8 of 1980 (as amended). The provisions of this law apply to all private sector employers in the UAE and Dubai. Employers established in one of the free zones may be subject to their free zone’s internal employment regulations, in addition to the minimum provisions of Federal Law No. 8.

A law firm with a specialism in employment law can advise you on matters such as employee relations, transactional work, and employment litigation. By receiving comprehensive legal advice, you will also stay up-to-date with any changes in regional laws.

Taxation

When starting a business in Dubai, it is advisable to seek professional advice on taxation. This way, you can fully understand the local tax implications of conducting business in the emirate. Value Added Tax (VAT) was introduced in early 2018 and, although there is no personal income tax, you may be required to pay other taxes such as municipal taxes or customs duties.

Your business needs to be a tax-efficient operation. As it grows and expands, you will need to be knowledgeable about the further tax implications of this.

Insurance

It is vitally important to be certain you have the right insurance coverage for your business. Be sure that you have sought legal advice on the types of insurance protection you should obtain. You may need cover for professional indemnity, public liability, product liability, property damage, personal injury, employer liability and many more. Without the right cover, your business may become vulnerable to various risks.

A worry-free start for your business

These are just five of the areas where you should obtain legal help when setting up a business in Dubai. You may require legal advice during various instances, such as in the event of a conflict or litigation, at times of expansion or acquisition, or when selling the business, for example.

By ensuring you have the services of an experienced law firm in Dubai, you can be certain your business is lawful and protected. This way, you can fully concentrate on developing strategies for business success, without worrying about your legal obligations not being covered.

AUTHOR BIO

Sharon Danso-Missah is the Head of Marketing at Al Tamimi & Company, the largest law firm in the Middle East, with 17 offices across nine countries. Established in 1989, they are a full service commercial firm combining knowledge, experience and expertise to ensure all clients have access to the best legal solutions that are commercially sound and cost effective.