| Dubai remains one of the top places globally for starting a business. Its strategic location, business-friendly laws, world-class infrastructure, and multiple jurisdiction options (Mainland, Free Zones, Offshore) make it very attractive. But there are many choices, rules, and costs to consider. Let’s break the process of company set up in Dubai
Types of Company Setup in Dubai
When you set up a company in Dubai, you’ll generally choose one of the following jurisdictions:
| Jurisdiction | Key Features | Pros & Cons |
|---|
| Mainland (Dubai Mainland) | Your business is registered under the Department of Economy & Tourism (DET) / Department of Economic Development (DED). Able to trade anywhere in UAE. May need local partner / sponsor in some cases. | Pros: full access to UAE market, no restriction on location. Cons: potentially higher setup costs, more regulations, office space needed. dda+2Anuvibs+2 | | Free Zone | Registered under a specific Free Zone Authority (e.g., DMCC, JAFZA, IFZA, etc.). Usually 100% foreign ownership allowed. Sometimes virtual offices possible. | Pros: ownership, tax / customs benefits, faster setup. Cons: some restrictions trading with Mainland directly; office space options vary. Just Moved Dubai+2Amary+2 | | Offshore | For businesses not carrying out physical operations in UAE, or mainly using UAE for investment, holding, or international transactions. | Pros: very low physical obligations, minimal local presence. Cons: cannot operate locally; limited business activity inside UAE. kwsme.com+2Just Moved Dubai+2 |
Key Steps for Setting Up a Company in Dubai
Here are the general steps you’ll need to take. Some variation exists by jurisdiction and business activity.
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Define your business activity
Decide exactly what your company will do (trading, services, manufacturing, etc.). This affects license type, approvals needed, fees. dda+2Anuvibs+2
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Choose legal form / structure
Examples: Limited Liability Company (LLC), Sole Establishment / Sole Proprietorship, Branch of Foreign Company, Free Zone Entity, etc. Structure affects ownership, liability, costs. Anuvibs+1
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Trade name registration
Selecting a unique name, getting it approved by the relevant authority. Names must follow rules. Felix Happich+1
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Initial Approval / Permission
Preliminary clearance for your activity and structure from DET / DED or relevant Free Zone. Felix Happich+1
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Memorandum of Association (MOA) / Local Service Agent (if needed)
Drafting articles of association between partners, or appointing a service agent for certain licenses. Anuvibs+1
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Office space / physical address
Mainland setup usually requires a physical office & Ejari lease registration. Some Free Zones allow virtual/flexi desks. Anuvibs+2Just Moved Dubai+2
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Secure other approvals (if needed)
If your business activity is regulated (e.g. food, medical, education, transportation, security), you may need permissions from specific authorities. Anuvibs+1
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License issuance
Once all paperwork is approved and fees are paid, the trade / commercial / professional license is issued. You can legally operate then. Just Moved Dubai+1
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Visa & Immigration (if applicable)
If you’re sponsoring yourself, employees, or dependents, you’ll need residence visas, medical tests, Emirates ID, etc. Free Zones often bundle a number of visas in their packages. Just Moved Dubai+2kwsme.com+2
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Bank account, compliance & operational setup
Open your corporate bank account, get accounting / audit setup, ensure you are compliant with VAT / taxes / other local laws. Start operations. Amary+1
Approximate Cost Breakdown
Here are estimated costs for first‐year setup in Dubai, for Mainland vs Free Zone. These are rough averages; your costs may vary depending on the exact activity, location, and number of visas.
| Expense Type | Mainland (Approx) | Free Zone (Approx) |
|---|
| Trade name reservation / registration | AED 600–1,000 Anuvibs+2Amary+2 | AED 200–800 or similar Amary+1 | | Initial approval / permit | AED 120–350 Anuvibs+1 | Often included or lower in some Free Zone packages Amary+1 | | License fees | AED 8,000 – 30,000+ depending on type of license & activity. Anuvibs+2Bizinvest Firm+2 | Free Zone license fees ~ AED 10,000 – 20,000+ depending on zone & activity. Just Moved Dubai+1 | | Office rent / workspace | Mainland usually requires physical office: AED 15,000 – 100,000+ / year depending on size & location. Anuvibs+1
Free Zone flexi/virtual offices cheaper, full offices more. Just Moved Dubai+1 | | | Visa & immigration (per person) | AED 3,500 – 7,000+ per visa depending on residency type etc. Anuvibs+1 | Similar costs in free zones, sometimes bundled. Global Business Setup+1 | | Sponsor / local agent fee (if required) | Mainland often requires local sponsor or service agent fees AED 10,000-25,000/year depending on arrangement. Bizinvest Firm+1 | Usually not needed in Free Zone. Just Moved Dubai+1 |
Key Differences: Mainland vs Free Zone
Here’s a quick comparison so you can decide which setup suits your business best:
| Factor | Mainland | Free Zone |
|---|
| Ownership | Historically local sponsor; recent reforms allow 100% foreign ownership in many activities. Anuvibs+1 | Usually 100% foreign ownership allowed. Just Moved Dubai+1 | | Office space requirement | Physical office mandatory; virtual offices typically not accepted. Anuvibs+1 | Often more flexible, with virtual, flexi-desk, shared office options. Just Moved Dubai+1 | | Market access | Can freely do business across all UAE, work with government contracts etc. dda+1 | Some restrictions vs Mainland sales or servicing mainland clients may need additional permissions. Just Moved Dubai | | Cost | Generally higher initial cost (license + office + sponsor etc.). Anuvibs+2Amary+2 | Can be lower for startups, depending on free-zone, activity, visa count. Just Moved Dubai+1 | | Renewal / recurring costs | License renewals, visa renewals, rent etc. tend to be higher. Amary+1 | Renewal costs often lower, depending on zone package. kwsme.com+1 |
How Much Should You Budget
To give you ballpark figures for your first year, here’s what you might expect depending on how basic vs premium your setup is:
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Basic Free Zone setup: ~ AED 15,000 - AED 30,000 (license, minimal office, 1 visa).
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Mid-range Free Zone or small Mainland: ~ AED 35,000 - AED 60,000 (office, license, 1-2 visas, local sponsor if needed).
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Larger Mainland / premium location / multi-visa: Can go upward of AED 80,000-150,000+ depending on physical space, number of employees, prestige of location.
Tips to Save Cost and Smooth Setup
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Choose the right jurisdiction early — Free Zone if you don’t need heavy mainland presence; Mainland if you want full UAE market access.
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Check if your business activity requires special approval before picking license — healthcare, education, food, tourism often have additional regulatory bodies.
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Start with minimum visa quota — just enough to begin. Additional visas can be added later.
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Office space — use shared, virtual, or flexi-desk options to lower rent if suitable.
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Use setup consultants — they may add a fee, but often save time and avoid costly mistakes.
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Keep renewal costs in mind — license, visa, rent, and compliance are recurring. Budget accordingly.
Final Thoughts
Setting up a company in Dubai is a strategic move that offers many benefits, but it pays to plan carefully: pick the right jurisdiction (Mainland vs Free Zone), know the fees, understand what documents you need, and factor in recurring costs like renewals, visas, and rent. |
