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Legal Requirements for starting a business in the UAE: Everything Entrepreneurs Must Know

Home > Blogs > Legal Requirements for starting a business in the UAE: Everything Entrepreneurs Must Know

 

Starting your business in the UAE is a doorway to one of the fastest growing business landscapes. But  the procedures of business licensing in UAE and company registration in such a global market can feel overwhelming to young entrepreneurs. The continuous updates in the legalities including ownership and licensing, aims to support and promote business and startups in the country, which is a great opportunity to those looking to grow their firms here. 

 

This blog is a complete guide to all your doubts regarding legal requirements behind starting your company in the UAE.  

 

Business Licensing in UAE

Every company planning to launch in the UAE should be registered and have a valid license before starting their operations. The new federal law for UAE companies came into effect from 2022, has made significant changes including stronger principles for foreign ownership, while also clearing several previously existing restrictions, while maintaining clear standards. 

There are primarily three different types of licences depending on your type of business:

  • commercial license

Required for any type of trading activities, buying or selling goods and import or export operations.

  • Professional license 

If your business is about any type of services like consulting, marketing or legal advice. 

  • Industrial license

For industrial purposes like manufacturing, processing and assembling products. 

According to the recent update in 2025, digital content creators and influencers also need licensing for any type of commercial activities. 

How long does it take to get a license? 

Compared to other countries, the legal paperworks is much faster in the UAE. It takes only about 5-15 business days for you to get a license. This depends on the type and complexity of your business. It is the department of economic development in each emirate who deal with these paperworks or the respective free zone authority where you’re starting your business.

The recent changes have made the application processes much easier, through unified online platforms. 

Mainland vs Free Zone vs Offshore Setup

Deciding the location and structure of your business is a crucial decision while registering your company in the UAE. because each option comes with its own advantages and limitations.  

  • Mainland companies

The mainland companies are the ones that can directly function in the local market and have almost no restrictions in their trading activities. If you’re looking for access to the wider local public market, this is the option for you. 

  • Allows 100% foreign ownership for most activities, as per 2021 law. 
  • Can bid on government contracts.
  • Require a physical office space (not less than 200 square feet if in Dubai), therefore might need higher initial setup cost. 
  • Free zone companies

If your company focuses more on international operations, without direct connection with the mainland, you can opt for a free zone license. 

  • Attractive benefits like guaranteed 100% ownership, full profit and capital returns to homeland. 
  • Tax benefits
  • Over 45 specialized free zones across the country focused on technology, media, healthcare and logistics.
  • Cannot conduct business directly with the mainland without a local distributor but free to operate internationally and within the freezone. 
  • Offshore companies
  • Exclusively for international businesses outside UAE.
  • No need of physical office spaces and complete confidentiality.
  • Cannot conduct business in the mainland.
  • Suitable for assets and holding companies, international trading firms.

 

The type of license you need is  based on your target market and your growth plan and business model. 

Trade Name Registration & Legal Documents Required

Your trade name must follow the existing rules and reflect your business activity. Avoid conflicting terms like royal, national or any other religious terms. Make sure not to use existing registered names. The trade name registration is done through DED or relevant free zone authority and takes usually 1-3 working days. 

Your business also needs approvals from relevant departments before launching, depending on the industry. 

Here is a list of necessary documents required for registering your business in the UAE: 

For all types of businesses: 

  • Passport copies and Emirates IDs of all shareholders
  • Address proof  of all partners
  • A detailed plan including business activities and financial estimates. 

Additional Documents based on the type of business:

1.Mainland Companies:

  • Memorandum of Association (MOA) for LLCs
  • Local Service Agent Agreement (LSA) for certain sole proprietorships 
  • Tenancy contract or Ejari and a physical office address (must meet DED requirements) 

2.Free Zone Companies:

  • Registration with the specific Free Zone Authority

3.Offshore Companies:

  • Registration with respective  offshore jurisdictions such as:
    • Jebel Ali Free Zone Authority (JAFZA)
    • RAK Offshore

 

Regulatory Approvals & Permits

Other than basic business licences, different business activities require special permissions from concerned authorities. Food and safety department clearance for food related business,ministry of health permits for healthcare industry. Likewise, to start  educational institutions you need KHDA approvals, for financial services SCA or DFSA authorization, TDRA licensing for telecommunication, and national media council approval for media related activities. For construction works and related activities you will need clearance from municipalities. 

It will be a better option to approach consultants who are experienced in the industry to get things done without hassle, and to clear confusions. 

Visas & Labor Laws

Your company can only offer employment visas for owners and staff depending on the type and office space of your business. For mainland licenses, visa approval depends on office size and activity, while free zones can sponsor 1 visa per 9 square meters. 

Professionals  and freelancers earning more than 3,60,000 annually, can apply for green visas, which are self sponsored. According to UAE labor laws, there should be written contracts, health insurance coverage, overtime compensation and a maximum of 48 hour work week. Employers should use wage protection systems for payment of salaries, which otherwise will result in fines and license suspension and even deportation. 

As experts in visa handling and documentation for over 25 years, we offer fast and reliable services for your business needs in Dubai, so you don’t have to worry about all the headaches of paperworks. 

With years of experience , Virtual Pro is one driving firm contributing administrations to both nearby and global elements. We offer astounding types of assistance for visa handling including Dubai Family Visa (Spouse Visa, Parent VIsa, Child Visa, New Born Visa), Ejari Service, business arrangement, and all archives related matters.

Copyright © 2025 Virtual Pro. All Rights Reserved.

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With years of experience , Virtual Pro is one driving firm contributing administrations to both nearby and global elements. We offer astounding types of assistance for visa handling including Dubai Family Visa (Spouse Visa, Parent VIsa, Child Visa, New Born Visa), Ejari Service, business arrangement, and all archives related matters.

Copyright © 2025 Virtual Pro. All Rights Reserved.