Overview
Forming a company in the UAE involves five core stages: choosing your jurisdiction, selecting a legal form, defining your activity codes, submitting your documentation, and obtaining your trade licence. Each stage has dependencies, and errors at any point can delay the overall timeline or create downstream problems for banking and visa applications.
This guide walks through the process in sequence, with practical notes on what to expect at each step.
Stage 1 — Jurisdiction Selection
Your first decision is whether to register on the mainland (DED-licensed) or in one of the UAE's free zones. This decision affects your trading rights, corporate tax position, banking options, and visa quota.
See our dedicated guide, Mainland vs. Freezone: How to Choose, for a full comparison. As a summary:
- Choose mainland if you are selling to UAE-based customers, need government contracts, or are in a regulated sector
- Choose freezone if your customers are primarily international, you want lower setup costs, or you operate in an industry with a sector-specific freezone
Stage 2 — Legal Form
The most common legal forms for new UAE businesses are:
LLC (Limited Liability Company) — the standard mainland form. 1–50 shareholders. Liability limited to share capital. Requires a Memorandum of Association (MOA) notarised by a UAE Notary Public. 100% foreign ownership permitted for most activities.
Sole Proprietorship — single individual owner. Full personal liability. Lower cost to set up but cannot issue equity. Suitable for freelancers and small professional services operators.
Free Zone Establishment (FZE) — single shareholder freezone entity. Limited liability. The freezone equivalent of a sole-director company.
Free Zone Company (FZCO) — 2–50 shareholders in a freezone. The freezone equivalent of an LLC. Common for joint ventures.
Branch of a Foreign Company — an extension of an existing overseas entity. The parent company is fully liable for the branch's obligations. Used when a foreign company wants a UAE presence without creating a separate legal entity.
Stage 3 — Activity Code Selection
Every UAE trade licence must include the specific commercial activities your business will carry out. These are drawn from authority-published lists — the DED alone has thousands of codes, and each freezone has its own register.
Why activity codes matter:
- The wrong activity code can prevent you from opening a bank account (banks cross-reference your licence activities against their risk frameworks)
- Regulated activities (financial services, healthcare, food import, live animals) require pre-approvals from sector regulators before a licence can be issued
- Import and export permissions are tied to your activity codes
- Your visa quota and Ejari/office requirements may vary by activity classification
Professional vs. Commercial: Mainland licences are classified as commercial, industrial, or professional. Professional licences (for consultants, advisors) have different ownership and structural rules and typically do not require a Memorandum of Association.
Stage 4 — Documentation
The documents required vary by jurisdiction, legal form, and nationality of shareholders. For an LLC on the mainland, the standard set is:
- Passport copies of all shareholders and directors
- Proof of address for all shareholders (utility bill or bank statement, within 3 months)
- Proposed company name (3 options for approval — names must not conflict with reserved or existing names)
- Memorandum of Association (drafted and notarised — Amara coordinates this)
- No Objection Certificate (NOC) from current UAE employer if any shareholder holds an existing UAE employment visa
- Ejari or commercial tenancy contract for the registered business address
- Pre-approvals from sector regulators where required
For freezone registration, requirements are broadly similar but the MOA/AOA format is dictated by the freezone authority, and there is no Ejari requirement — a flexi-desk or service office arrangement within the zone is sufficient.
Stage 5 — Licence Issuance and Post-Setup
Once documentation is approved and fees paid, the trade licence is issued. Typical timelines:
- DED mainland: 5–15 working days from complete submission
- Most freezones: 3–10 working days, with some offering express options
After licence issuance, the following steps are required:
- Customs registration — if you intend to import or export, register with UAE Customs for an import-export code. Typically 3–10 working days.
- Corporate tax registration — register with the Federal Tax Authority (FTA) on EmaraTax within the required window (90 days of licence issuance for most entities)
- VAT registration — mandatory if your taxable turnover will exceed AED 375,000/year; voluntary above AED 187,500
- Bank account opening — submit your KYC pack to your chosen UAE bank. Allow 2–8 weeks depending on the bank and your structure
- Visa applications — investor and employment visas can be applied for once the trade licence and establishment card are issued
Estimated Costs
Costs vary significantly by emirate, freezone, activity mix, and office arrangement. Indicative ranges for initial setup (excluding Amara coordination fees):
| Setup Type | Indicative Range (AED) |
|---|---|
| Dubai Mainland LLC | 25,000 – 55,000+ |
| Abu Dhabi Mainland | 20,000 – 45,000+ |
| Mid-tier Freezone (IFZA, RAKEZ) | 8,000 – 20,000 |
| Premium Freezone (DMCC, DIFC) | 20,000 – 60,000+ |
These ranges include licence fees, registration costs, and a compliant address. They exclude visa fees, PRO service costs, and authority disbursements for regulated activities.
How Amara Supports This Process
Amara manages the entire formation process on your behalf — from activity code selection and name reservation through to licence receipt and post-setup registrations. We work with licensed corporate services providers and notaries for the regulated steps, and coordinate documentation with authorities on your behalf.
All third-party disbursements (DED fees, notarisation, etc.) are invoiced at cost with your prior written approval.