How to start a business in Abu Dhabi

Although UAE is a diverse tourist destination, when it comes to the global business community, it has much more to offer. The privileged tax rates, geographical placement, and dynamic economy make it a nerve center for direct foreign investments. Besides, the UAE government also puts in relentless efforts to make the business functioning easy in the country. Nevertheless, there has always been a special focus on the capital city – Abu Dhabi. So, if you are wondering how to start a business in Abu Dhabi, here’s a detailed guide. 

Starting a business in Abu Dhabi 

Abu Dhabi has the second-largest population in the UAE and in terms of area, it is the largest emirate as well. With its strategic placement and fast-growing market, it provides excellent opportunities for small businesses to aspire towards exponential growth. It also has easier connections to markets in different countries, which is an added benefit to these enterprises. The well-drafted pro-business policies create a supportive environment for investors from all over the globe. It offers a large number of opportunities in every business sector, thus making it an attractive business location for entrepreneurs and investors. 

Benefits of setting up a business in Abu Dhabi 

  • Easy to acquire a trade license and local visas 
  • Freedom to run the business without the interference of the local partner
  • Renting facilities available for office premises 
  • Access to open a bank account from the Chamber of Commerce and Industry of Abu Dhabi 
  • Abundant supply of energy for the business 
  • Affordable energy resources 
  • Competitive freight charges as compared to other emirates
  • Easy to open global corporate bank accounts 
  • Competitive property rates as compared to other emirates 

Types of company formation in Abu Dhabi 

Basically, Abu Dhabi offers two types of company formation options – 

  • Abu Dhabi Free Zone Company formation 

Freezone authorities in Abu Dhabi provide a perfect gateway for the smooth registration and establishment of companies in the region. In a freezone company formation, business owners get to avail single-window administration facility. In simple words, the owner can submit all the necessary documents and information as well as fulfill all the legal formalities to a single agency/department. Moreover, freezones are authorized as independent jurisdictions. Hence, the entrepreneur can enjoy complete ownership of the company. 

Abu Dhabi Freezone authorities provide licenses for several businesses such as commercial trading, consultancy, branch offices, etc.

You may like it: Benefits of UAE Free Zones Company Setup

  • Abu Dhabi Mainland Company formation 

Unlike Freezones, Mainland falls under the supervision of the UAE government. Hence, companies operating in the Mainland cannot make any trade in the freezones. However, they are allowed to trade anywhere across the UAE. 

At present, Abu Dhabi is one of the most developed economies in the UAE due to its regularized policies and legal guidelines. Earlier, the business owners of Mainland companies were allowed to own only 49% of the total company shares. However, with the recent amendment in the Commercial Companies Law, they can now hold 100% ownership of the company. 

Categories of legal entities allowed in Abu Dhabi 

  • General partnership
  • Limited partnership 
  • Limited liability company (LLC) 
  • Public joint-stock company (PJSC) 
  • Private joint-stock company (PrJSC) 
  • Civil company
  • Local company branch 
  • GCC company branch 
  • Foreign company branch 
  • Free zone company branch 
  • Sole establishment
  • Holding companies 

How to start a business in Abu Dhabi? 

Abu Dhabi provides access to the markets of various regions. Besides, there is an ample and expert workforce that assists in business setup in Abu Dhabi. Therefore, starting a business in Abu Dhabi can be a beneficial decision. 

Below are steps that explain how to start a business in Abu Dhabi –

  • Determine the type of business activities 

The first step of planning a business anywhere in the UAE starts with identifying the type of business activity that you want to perform. The licensing procedure and other legal requirements depend on the economic activity you choose for your business. Abu Dhabi authorities offer over 2000 categories of activities to choose from. A company can run multiple streams of activities under one license. 

  • Determine the legal form of business 

When you decide to set up a business in Abu Dhabi, you need to choose a legal company structure that you want to run. There is a variety of options to choose from, and the rules and regulations are different for different ownership structures. Hence, it is imperative to figure out which legal form would be the most suitable for your business idea. 

  • Register the trade name of the company 

Registering a trading name is very important for a business as it gives an identity to the company and its owner in the market. Moreover, a registered trade name cannot be used by any other brands or businesses. Hence, it spares the company products from any kind of forgery or fraudulent activities, whatsoever. 

The company owner can register their trade name with the Department of Economic Development(DED) Abu Dhabi. But, before finalizing a name for the business, the owner must strictly follow the naming protocols set by the UAE authorities. Any failures may lead to the rejection of the trade name application. Hence, it’s better to seek professional insight from the experts of Shuraa to settle on a trading name that would be suitable, appropriate as well as within the laws. 

  • Obtain the initial approval 

Before starting a business in Abu Dhabi, the foreign businessmen must initially obtain approval from the General Directorate of Residency and Foreigners Affairs(GDRFA). Apart from that, once you receive a trade name certificate, DED issues approval to set up a business in Abu Dhabi. With this approval, the business owner can proceed further with the business license application. 

  • Draft an MOA or an LSA 

Some legal entities require a Memorandum of Association(MOA) while some others require a Local Service Agent Agreement(LSA). Therefore, the owners must properly draft either of them, whichever is required, and get them attested by the relevant authorities. These may include notary public, UAE-based law firms, and courts. 

  • Obtain the membership in Abu Dhabi Chamber of Commerce & Industry 

According to the Law 7 of 1988, all business owners, whether UAE nationals or foreigners, who are engaged in any kind of industrial, commercial, or professional activities in Abu Dhabi must obtain membership of the Abu Dhabi Chamber of Commerce and Industry. 

  • Get special/final approvals and pay the fee 

Once all the above steps are complete, it’s time to pay the legal fee and fulfill the other legal requirements. This may also include approvals from special agencies and departments for certain business activities. For example, the Ministry of Foreign Affairs, Department of Transport, Environment Health & Safety Centre, etc. 

  • Obtain the license 

Now that you have completed all the legal formalities, you can receive your license from the authorities and commence your business operations. 

Conclusion 

Even though the entire process of business setup in Abu Dhabi is fairly simple and effortless, you might require the assistance of a professional business consultant during the initiation of the business. 

The dedicated team of Shuraa Business Setup can help you establish your business in the capital city of the UAE. We can provide you with all the general services of a business set up in the UAE such as government approvals, registrations, licensing, and more. Furthermore, we can speed up the process by taking care of all the legal formalities of business formation in Abu Dhabi, UAE. 

To get more details on how to start a business in Abu Dhabi, speak with our experts. Give us a call at +971 44081900 or send a WhatsApp message at +971 507775554. For email assistance, you can write to us at [email protected]

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