Abu Dhabi, the capital city of the United Arab Emirates (UAE), has emerged as a thriving hub for businesses seeking growth and expansion opportunities. Its strategic location, robust infrastructure, pro-business environment, and investor-friendly policies make it an attractive destination for startups and multinational corporations alike. Here’s an inclusive guide to understanding the process of business setup in Abu Dhabi:
Step 1: Determine your business activity:
Identify the primary objectives and core functions of your enterprise to determine the appropriate business activity according to the Department of Economic Development (DED) classifications. There are more than 1,000 categories across multiple sectors, allowing flexibility when choosing your area of operation.
Step 2: Decide upon legal entity type:
Selecting the right legal entity ensures smooth integration into the Abu Dhabi market while catering to your operational needs. Some common forms of business setup in Abu Dhabi include:
Onshore company: Allows full control over day-to-day management but requires partnership with a UAE national holding at least 51% equity stake. Ideal for large enterprises engaging in diverse industries.
Free zone company: Offers 100% foreign ownership, streamlined incorporation procedures, zero currency restrictions, and minimal red tape. Suitable for small to medium-sized organizations focusing primarily on exports/imports, trading, consulting, or manufacturing.
Professional firm: Enables professionals offering specialized expertise, e.g., lawyers, doctors, engineers, etc., to practice independently without requiring a local partner. Excludes engineering consultancies, medical clinics, law firms, and auditing practices.
Step 3: Choose a trade name & location:
Pick a distinctive trade name devoid of any offensive language or religious connotations. Afterward, select a preferred location depending upon budget constraints, accessibility, target audience proximity, and facility suitability.
Step 4: Apply for initial approval certificate:
Submit an application requesting preliminary approval via the Abu Dhabi DED website or directly at one of their service centers. Attach mandatory documentation comprising passport copies of shareholders, NOC from current sponsors (if employed), and other prerequisites stipulated by individual free zones.
Step 6: Finalize tenancy contract & pay rent:
Negotiate lease terms with landlords, finalizing tenancy contracts detailing rental costs, expiration dates, renewal conditions, maintenance responsibilities, and termination clauses. Submit signed agreements accompanied by rent receipts duly attested by Ejari – the official registry system in Abu Dhabi.
