How To Start a Business In Abu Dhabi

The United Arab Emirates is renowned for its diverse tourist attractions and is a major hub for economic ventures. To promote trade and global expansion, the UAE government assists entrepreneurs in setting up their businesses. Abu Dhabi, one of the most renowned cities in the United Arab Emirates, has grabbed attention from investors worldwide as a prime destination for business ventures. Owing to its strategic location coupled with low import tariffs, favourable economic tax rates, and a flourishing economy, countless entrepreneurs are considering to start a business in Abu Dhabi.  

This blog is the perfect guide for beginners who wish to know about the basics of establishing their business in Abu Dhabi.  

Abu Dhabi as a business location: 

Abu Dhabi, the gorgeous capital city of the United Arab Emirates, has become a top place to live, work, and invest. Known for its rich history and culture, supported by its strategic geographical location and future development plans, today Abu Dhabi has become a global hub for technology, finance, and business. 

The smartest city in the Middle East, Abu Dhabi proudly leads in innovation and technology initiatives and is home to big thinkers, innovators, and futuristic companies. 

Here are the exceptional benefits that Abu Dhabi offers: 

Strategic location:  

A place where East meets West, Abu Dhabi’s fantastic geopolitical location makes it a global hub and gateway to markets across the Middle East, Africa, and South Asia. 

High quality of life:  

The city features a well-established, progressive, and dynamic population with a high per capita income. 

State-of-the-art infrastructure:  

One of the benefits of company formation in Abu Dhabi is access to top-notch, high-quality ports, roads, and facilities that facilitate smooth operations. 

High connectivity:  

Abu Dhabi excels in the ICT space, making connectivity for business units reliable and consistent. The internet penetration rate is very high. 

Ease of doing business:  

The city offers a simple and encouraging process for business setup, with a particular focus on supporting tech and innovation startups. 

Ownership benefits:  

Entrepreneurs can enjoy 100% ownership of their business for many activities on the mainland and in every free zone. 

Stable economy:  

Abu Dhabi is the political and cultural heart of the UAE, with a thriving and stable economy. In fact, with a strong GDP, it contributes more than 60% to the nation’s total economy. 

Tax advantages:  

Depending on the business model, corporate tax can be very low or even zero. Additionally, there is no personal tax and very low customs charges for entrepreneurs. 

Vibrant talent pool:  

At the core of any business’s success is its people, and Abu Dhabi offers a top talent pool across a wide range of fields, including technology, finance, mathematics, entrepreneurship, and engineering. 

Types of business setup in Abu Dhabi: 

Wondering where you can start a business in Abu Dhabi? Abu Dhabi offers three main jurisdictions for entrepreneurs: 

Mainland business setup:  

Starting a business on the mainland provides the flexibility to operate across UAE markets as well as globally. Recently, many activities now allow 100% ownership by foreign investors. 

Free zone business setup:  

Free zones are special economic zones offering unmatched benefits to businesses, such as 100% ownership, tax exemptions, full profit repatriation, and more. 

Offshore business setup:  

Offshore company formation is ideal for those who do not need a physical presence in the UAE but want to take advantage of its liberal tax environment for international trading. Offshore companies are, however, prohibited from conducting business within the UAE. 

Essential steps for starting a business in Abu Dhabi   

With the second-highest population in the UAE and the largest emirate by land, Abu Dhabi, provides numerous advantages to international companies. It offers startups and SMEs fantastic chances to strive for exponential growth. Furthermore, a recent reform in the UAE that permits 100% foreign ownership has created countless opportunities. As a result, many domestic and international businesses have been considering opening offices in Abu Dhabi.  

Here is how to start a business in Abu Dhabi: 

STEP 1 – Determining business activity   

To start a business in Abu Dhabi, you first need to identify business/ commercial activity you want to go ahead with. The nature of your business will determine the legal requirements as well as the licensing fee applicable to your company. There are majorly six different types of licenses available in the UAE namely industrial, tourism, professional, commercial, agricultural, and occupational.  You can move ahead with the legal work after establishing the selecting your business type.  

STEP 2- Selecting the legal structure of your business  

Choosing the ideal legal form for your company is an essential step when setting up business in Abu Dhabi. The legal structure of your company will determine the rules and regulations applicable to your company. Ensure that the legal form of your business matches your business activity. Some of the most popular legal structures are as follows:  

• 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  

You can get in touch with our experts at Dubiz Business Setup to find out the best option for you!  

STEP 3 – Selection of Trade Name   

Choosing an appropriate trade name is the most important step when starting a business in Abu Dhabi. The chosen trade name must be registered with the Emirates’ Department of Economic Development. However, some naming conventions must not be violated while choosing a trade name. Some of them are as follows:  

• The chosen name should not transgress the moral code.  
• The name must exclude any governing authority names, religion, logos etc.  
• The chosen name must reflect the business activity.  
• The chosen should be one of a kind and not in use by any other organisation.  

A transaction number or payment voucher will be provided during the registration procedure. The price may differ based on the nature of the firm, and payment must be received within 30 days. DED keeps track of trade names. Certificates under a trade name are valid for renewal. The Ministry of Economy is the official body for trademark registration in the UAE.  

STEP 4 – Acquiring initial approval   

The DED will initiate the approval once you have acquired the trade name certificate. This allows the investor to apply for a business license. Approval from the General Directorate of Residency and Foreigners Affairs is required for foreign investors.  

STEP 5 – Preparing Essential Legal Documents: 

A Memorandum of Association (MOA) is essential for certain business types: 

• Limited partnership 
• Limited liability company (LLC) 
• Public joint-stock company (PJSC) 
• Private joint-stock company (PrJSC) 

Essential documents like the MOA needed to start a business in Abu Dhabi must be attested by a Notary Public. Additionally, in the case of sole proprietorship, a Local Service Agent Agreement (LSA) may be required. 

STEP 6 – Choosing Office Space: 

You get various office options for your business in Abu Dhabi, such as commercial spaces, virtual desks, warehouses, fully owned offices, or other setups. What you need depends on factors like your business size and scope, license type, and operational requirements. Remember, for some activities, having a physical office space is mandatory, while others may allow virtual operations. 

STEP 7 – Securing Additional Government Approvals  

In certain situations, obtaining additional permissions from specific governmental authorities is necessary. Some of these entities are:  

• Ministry of Interior  
• Ministry of Justice  
• Local Municipal Department  
• Executive Council  
• Ministry of Economy  
• Local Health Departments  
• Supreme Petroleum Council  

STEP 8 – Obtaining Business License   

After completing the steps above, you can apply for the business license at the service centers of the Economic Department. Alternatively, the license can also be obtained through their website. In the case of a free zone, you would need to reach out to the specific free zone authority. 

To obtain the business license in Abu Dhabi, the following paperwork is required:  

• Initial approval receipt 
• All previously submitted documents.  
• Copy of lease contract (attested by the Real Estate Regulatory Agency (RERA)  
• Duly attested memorandum of association (for all company types)  
• Approvals from other government entities  
• Duly attested service agent contract (for civil establishments that are 100% owned by non-GCC nationals. This also involves local service agents.  

STEP 9 – Get visa and open a bank account: 

Before starting your business, you may need to secure a business visa for yourself to work in the UAE. In some cases, a visa may also be required for your employees. Additionally, you can sponsor residency for your family members. 

For your business, it is also beneficial to open a corporate bank account with your chosen bank to help you track and manage your business finances effectively. 

Top freezone in Abu Dhabi: ADGM 

Abu Dhabi is home to one of the world’s most advanced financial hubs, Abu Dhabi Global Market (ADGM) Free Zone, a recipient of numerous awards and a leading force in global finance. This impressive free zone deserves special mention. 

ADGM spans a vast area of 14.38 million square meters, making it one of the largest financial centers worldwide. Its size is just a small part of its distinguished status. ADGM proudly hosts top financial institutions, asset management firms, fintech companies, corporate entities, and other professional firms. 

Key benefits to start a business in Abu Dhabi freezone ADGM include: 

• A transparent, fast, and business-friendly company registration process 
• Strong regulatory oversight and guidance for businesses 
• 100% ownership of the business 
• A broad range of activities to choose from 
• Top-notch infrastructure, facilities, and office spaces 

Cost of starting a business in Abu Dhabi: 

The cost of obtaining a business license in Abu Dhabi ranges between AED 6,000* to AED 30,000*. This cost depends on various factors, including your business nature, chosen activities, the number of visas required, and whether your location is on the mainland or in a free zone. 

For an exact cost estimation for your business setup in Abu Dhabi, contact our experts at Dubiz Business Setup. 

Starting an online business in Abu Dhabi:  

The UAE government has simplified starting an online business in Abu Dhabi by launching a unified online platform, Bashr. You can establish an online business in Abu Dhabi within 15 minutes via this portal. Bashr is connected with local and federal entities, making applying for a commercial license simple. You can apply for a license by visiting the official website of the UAE Emirates Government Portal.  

Start a business in Abu Dhabi with DUBIZ!  

Opening a business in Abu Dhabi is a straightforward process, making it an attractive option for foreigners looking to expand in the United Arab Emirates. With our experts by your side, you can fast-track your journey to success and build the company of your dreams. We understand that navigating legal intricacies as a foreigner can be challenging. That is why we ensure our services cover every detail for Abu Dhabi company formation: 

• Business registration in Abu Dhabi 
• Trade licensing 
• Government approvals 
• PRO and document clearance 
• Bank account opening 
• Tax and VAT registration, and more 

Accelerate the launch of your Abu Dhabi company setup with the expertise of Dubiz’s seasoned professionals! 

Contact Dubiz today at +971563695485. You can also drop an email at info@dubiz.co for any inquiries.  

FAQs: 

1. How many freezones in Abu Dhabi? 

There are currently eight freezones in Abu Dhabi: 

• Abu Dhabi Global Market (ADGM) 
• Abu Dhabi Ports Company Freezone  
• Masdar City Freezone 
• Khalifa Industrial Freezone (KIZAD) 
• Twofour54 
• Industrial City of Abu Dhabi 
• Abu Dhabi Airport Freezone 
• Higher corporation For Specialized Economic Zones (ZONESCORP) 

2. Can a foreigner start a business in Abu Dhabi? 

Yes, foreigners can start a business in Abu Dhabi. They can choose a free zone, mainland, or offshore as they prefer. While mainland may need one but in freezones there is no need for local sponsors for establishing a venture as a foreigner. 

3. Is Abu Dhabi a good place to start a business? 

Abu Dhabi is an excellent choice for starting a business. It offers a high quality of life, modern infrastructure, a strategic geographic location, and a supportive business environment for entrepreneurs. 

4. What documents are needed to start a business in Abu Dhabi? 

To start a business in Abu Dhabi, you will need a filled application form, initial approval certificate, copy of the lease contract attested, business plan, financial statements, passport copy of the business owner, passport-sized photographs, MOA attested, government approvals, among other documents. Call Dubiz experts to know more. 

5. How to open a company in Abu Dhabi? 

Here are the steps for Abu Dhabi company formation: 

1. Determining business activity and selecting legal structure 
2. Selection of trade name and acquiring initial approval 
3. Preparing essential legal documents 
4. Choosing office space 
5. Securing additional government approvals 
6. Obtaining business license 
7. Get visa and open a bank account