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business setup in Abu Dhabi - guide

Step by Step Process to Establishing a Business in Abu Dhabi 2023

The United Arab Emirates is a place where investors look for opportunities to flourish and thrive since it’s a dynamic hub for global businesses. If this is your case, you may be interested in business setup in Abu Dhabi.

Although Dubai may be the top destination for business owners, Abu Dhabi has been placing itself as a center for several commercial activities so you can take advantage of this excellent place.

In this article, you’re going to learn about the entire process of incorporating a company in Abu Dhabi. You can also understand why a service provider can be a great ally to achieve your objectives with business setup in Abu Dhabi. Let’s observe:

  • What is the process for business setup Abu Dhabi?
  • Why is Abu Dhabi a great place to start a business?
  • Which options do you have to create your business in Abu Dhabi?
  • How to set up a business in Abu Dhabi Mainland?
  • How to set up a business in an Abu Dhabi Free Zone?
  • What are the key steps for setting up a business in Abu Dhabi?
  • How can Connect Group help you with business setup in Abu Dhabi?

What is the Process for Business Setup in Abu Dhabi?

Carrying out the process for business setup in Abu Dhabi could be challenging for foreign investors since there are many legal formalities that you have to go through. In this regard, it’s important to be very well-informed before starting the process so you can be prepared.

For this reason, it’s essential to learn how you can set up a business in Abu Dhabi successfully. In addition, you should know which jurisdiction may be the best for you and which legal form can provide you the benefits you expect.

Whether you’re planning on opening a branch for your foreign company or you want to set up a new business, you have to find out about the procedures and stages of the process.

Why is Abu Dhabi a Great Place to Start a Business?

The UAE has been the prime destination for foreigners that want to have a successful business. In fact, many multinationals have set up their regional office in this country so they can take advantage of this fast-growing market.

For this reason, entrepreneurs and business owners look for the best places in this country to incorporate their company. Dubai has been considered as the primary commercial hub, but Abu Dhabi has been a popular destination in the last few years too.

Abu Dhabi is the largest of the seven emirates and the federal capital, so it has been putting a big effort to increase its global presence so investors feel welcomed there.

Although this place has been a center for the oil and gas sector, nowadays we can see businesses from all commercial activities. Therefore, considering the process for business setup in Abu Dhabi may be the best idea for you.

Let’s observe the following reasons why Dubai is a great place for investment opportunities:

100% Tax-free

A great reason why investors choose the UAE to make business is because of its tax policies. In Abu Dhabi, just like in Dubai, you get a 100% tax-free corporation.

It means that you won’t have to pay for corporate taxes, income taxes, capital taxes and any other one. This can be a great benefit for your business since you can gain even more profit.

High Rate of Successful Business

As part of the Abu Dhabi government’s policies regarding the economic development, any business that decides to start here has high chances of success. Currently, the non-oil industries are a huge part of the economy and it’s expected to have a multiplier effect in terms of infrastructure and investment.

In addition, local industry companies are always looking for new technologies and services so you can take advantage of this matter. The retail area is also gaining popularity, so any business activity is welcomed in this place.

Limited Government Interventions

There are more reasons to consider Abu Dhabi a great place for making business, which are the following:

  • No foreign exchange controls.
  • Absence of trade barriers.
  • There are no restrictions on quotas thus you can apply for multiple visas.
  • Gives flexibility to trade and carry out business in other regions.
  • You have several options to start your business.
  • It’s a strategic location in the Middle East.

Best Locations To Create Your Business in Abu Dhabi?

Once you know why you should carry out the process for business setup in Abu Dhabi, you may be wondering which options you have available.

In this regard, it’s important for you to learn about the jurisdictions in Abu Dhabi. When we talk about jurisdictions, we’re referring to the different zones where you can incorporate your company, and each one of them has its own advantages, benefits and regulations.

Let’s observe the following options you have to establish your business presence:

Abu Dhabi Mainland

If you’re planning on setting up a branch office, a professional firm or a establishment, you could incorporate an LLC. It’s a great option for foreign investors, but there is one disadvantage with this kind of corporation.

A Mainland company in Abu Dhabi requires having a local sponsor which will hold the 51% of the shares. Therefore, as a foreign investor you could only own the 49%.

However, the advantage of forming a company in Mainland is that you’re going to be able to trade anywhere in the UAE.

Abu Dhabi Free Zone

The other option you have available to start your company is any of the Free Zones. A Free Zone is an area within an emirate where you can set up a business.

With a Free Zone Company, you can have 100% ownership, but the downside is that you’re subject to restrictions, meaning that you can only conduct businesses within the respective Free Zone.

As you can see, choosing where you want to locate your company means that you have to evaluate and consider your options to select the best one for you.

How to Set up a Business in Abu Dhabi Mainland?

If you want to carry out the process for business setup in Abu Dhabi Mainland, you’d want to have more information about the options available.

LLC Company

In Mainland you can select to form an LLC, or Limited Liability Company. It’s the preferred legal type of business for foreign investors. The main reason is because you can work within the UAE market and this is a great advantage.

Let’s observe the main characteristics of an LLC as follows:

  • 2 shareholders minimum and 50 maximum
  • You need a local partner
  • The foreign investor has 49% of shares and the UAE National has 51%

Now, let’s observe the benefits of owning an LLC as follows:

  • An LLC can trade in the local and international market
  • Local companies may prefer to work with other LLC companies
  • There’s not a minimum capital required
  • The foreign investor can get the investor visa and investor status
  • It has few restrictions

You don’t need to worry about the local sponsor, since it usually acts a silent partner and you can have the total control of your business. For this reason, partnering with Connect Group can be your best option.

Branch Company

Another option you have for a Mainland business is to create a branch company. You need to appoint a Service Agent but don’t worry since it won’t interfere with your activities.

This option is perfect for businesses that want to test the UAE market by promoting the products of its parent entity or offering services.

Professional Firm

A Professional Firm is one that is designed to offer professional activities, and with some exceptions it can be wholly owned by a foreign investor. You need to appoint a local service agent for sole proprietorship. However, the local agent won’t be involved in your business.

How to set up a Business in an Abu Dhabi Free Zone?

The other option you have for business setup Abu Dhabi is incorporating a company in any of the Free Zones. Each Free Zone has its own Authority and each one is designed to allow commercial activities, licenses and entities within its area.

Let’s observe the advantages of setting a company in a Free Zone as follows:

  • 100% ownership for foreign investors
  • Limited restrictions on hiring labor
  • No taxes involved
  • 100% return of capital and profits

What are the Major Free Zones in Abu Dhabi?

It’s important to note that each Free Zone has a dedication to a specific business sector or certain industry. There are 8 Free Zones in Abu Dhabi, which are the following:

  1. Abu Dhabi Airport Free Zone (ADAFZ)
  2. The Abu Dhabi Media Free Zone (Twofour54 Media City)
  3. Masdar City Free Zone
  4. Abu Dhabi Global Markets Free Zone (ADGM)
  5. Khalifa Industrial Zone Abu Dhabi (KIZAD)
  6. Abu Dhabi Ports Company Free Zone (ADPC)
  7. Industrial City of Abu Dhabi
  8. Higher Corporation for Specialized Economic Zones

What are the Key Steps for Setting up a Business in Abu Dhabi?

Once you have decided that the UAE is your destination and that you want to carry out the process for a proper setup in Abu Dhabi, you have to learn about the process to achieve it.

Although the process may vary depending on the jurisdiction and legal form, it usually involves following key steps. Let’s observe as follows:

Choose your Economic activity

The main step for setting up your business in Abu Dhabi is choosing your economic activity. You must do this before starting the procedure.

You should choose the activity or activities of your intended business. It’s important because this will determine the legal requirements and fees.

Determine the legal form

Determine if your business is going to be incorporated as a LLC, a Limited Liability Partnership, a Branch office or any other legal form you’d like. Keep in mind that this determines the ownership type and regulations.

Register the Trade Name

The Trade Name is the one that distinguishes your business. It must be aligned with your business activity and legal form. You must register it and it must be unique.

Get the Initial Approval

With the Trade Name Registration and additional documents and requirements, you can request the Initial Approval Certificate. Submit the application to the relevant authorities to get the approval for your business.

Get the External Approvals

Some businesses require external approvals from government and non-governmental entities. It depends on your business activity. However, some businesses may not need this.

Collect your business license

The final step is applying to the DED to collect your business license. You must fulfill all the legal requirements and pay the mandatory fees.

How can Connect Group help you with Business Setup in Abu Dhabi?

If you need assistance with business setup in Abu Dhabi you must find a trustworthy partner that can help you with each step of the process. Here in Connect Group we offer a variety of options you can choose from so you can have the perfect service provider according to your needs.

Starting a business isn’t easy therefore you must carefully select the third-party that is going to help you with company formation. By partnering with a reliable partner, you can get all the services you need and enjoy a hassle-free procedure. Our team of specialists is readily available to accompany you and guide you throughout the entire process.

The Complete Guide for LLC Company Formation in Dubai

Connect Group is here to help you at every step of your business journey in the UAE with ease.

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