Business Setups in UAE: A Complete Guide to Company Formation & Bank Account Opening

The United Arab Emirates (UAE) is one of the most business-friendly countries, offering a strategic location, tax advantages, and world-class infrastructure. Whether you're a startup, an SME, or a multinational corporation, setting up a business in the UAE is a lucrative choice. This guide provides a detailed overview of business setups in the UAE, the step-by-step company formation process, and how to obtain a business bank account number.

Types of Business Setups in the UAE

The UAE offers three main types of business entities:

1. Mainland Company

• Registered under the Department of Economic Development (DED).
• Can operate anywhere in the UAE and internationally.
• Requires a physical office space.
• 100% foreign ownership is allowed in most sectors.

2. Free Zone Company

• Offers 100% foreign ownership.
• No corporate tax (subject to Free Zone regulations).
• Limited business operations within the UAE mainland.
• Ideal for trading, IT, consultancy, and logistics businesses.

3. Offshore Company

• Primarily used for international business and asset protection.
• Cannot conduct business within the UAE.
• No physical office required.
• Exempt from corporate and VAT taxes.

Procedure for Company Setup in the UAE

Setting up a business in the UAE involves several steps, depending on the type of company you choose. Below is a step-by-step guide to the company formation process:

Step 1: Choose a Business Activity

• Select a business activity based on your industry.
• Check if the chosen activity is permitted under UAE regulations.

Step 2: Select the Business Jurisdiction

• Choose between Mainland, Free Zone, or Offshore, depending on your business goals.

Step 3: Choose a Company Name

• Ensure the trade name complies with UAE naming regulations.
• Avoid using offensive or religious words.
• Reserve the name through the relevant authority (DED or Free Zone authority).

Step 4: Obtain Initial Approvals

• Submit the required documents for initial approval.
• Secure approvals from relevant regulatory bodies.

Step 5: Draft & Sign Legal Documents

• Draft the Memorandum of Association (MOA) and Articles of Association (AOA).
• Notarize the documents if required.

Step 6: Obtain Business License

• Apply for the required license: Commercial, Industrial, or Professional.
• Pay the necessary government fees.

Step 7: Register for Corporate Tax & VAT (if applicable)

• Register for Corporate Tax (9% tax applies to businesses earning above AED 375,000 per year).
• Register for VAT if annual turnover exceeds AED 375,000.

Step 8: Apply for Visas & Labor Card

• Apply for investor or employee visas.
• Register with the Ministry of Human Resources and Emiratization (MOHRE) if hiring employees.

Step 9: Open a Business Bank Account

• Choose a UAE-based bank for business banking needs.
• Submit the required documents to open a corporate bank account.

How to Obtain a Business Bank Account in the UAE

Once your company is legally registered, you need a corporate bank account to manage transactions. Here’s how to obtain a bank account:

Step 1: Choose a Bank

• Compare various UAE banks based on services, fees, and account requirements.
• Some popular banks include Emirates NBD, Mashreq Bank, ADCB, and FAB.

Step 2: Gather Required Documents

• Valid trade license.
• Memorandum of Association (MOA).
• Passport and visa copies of shareholders and authorized signatories.
• Proof of business operations (contracts, invoices, business plans, etc.).
• Proof of address (Ejari or tenancy contract).

Step 3: Submit Application

• Visit the bank or apply online (if available).
• Provide complete documentation for verification.

Step 4: Bank’s Due Diligence Process

• The bank will review documents and conduct KYC (Know Your Customer) checks.
• Some banks may request additional documents or a personal interview.

Step 5: Receive Your Business Bank Account Number

• Once approved, you will receive your account details and can start transacting.

Conclusion

Setting up a business in the UAE is a streamlined process if done correctly. By selecting the right business jurisdiction, complying with regulations, and obtaining a corporate bank account, businesses can take full advantage of the UAE’s economic benefits. Whether you are a startup or an established company, the UAE offers unmatched opportunities for business growth and success.

For expert guidance on company setup and bank account opening in the UAE, consult with a professional business consultancy firm to ensure a hassle-free process.

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