Allegiance International, a premier legal and business consultancy with expertise in Dubai’s business scene, has a few key tips and advice for entrepreneurs excited to conduct business in Dubai. Dubai is often referred to as the “city of the future”. Considering its growing influence as a hub for finance, commerce, and industry, it’s easy to see why the largest city in the United Arab Emirates claims this title.
Since 2015, the Dubai Chamber of Commerce has published a “Dubai Innovation Index Report” analyzing global cities based on innovation cultures and government support. Dubai consistently scores in the top 25, and in a separate report produced by StartupBlink, Dubai is the number one city in the United Arab Emirates for startups. Moreover, its strategic geography makes it an ideal location for business leadership. Flights to Europe, Africa, Asia, and the Middle-East are abundant, cheap, and relatively short.
Startups and established corporations alike could benefit greatly from access to Dubai’s growing market. The City of the Future also hosts the world’s second largest re-export hub – the Jebel Ali Industrial Zone. In 2016, Jebel Ali hosted 80.2 Billion USD in trade transactions. Dubai’s market represents an opportunity startups and well-established corporations can ill afford to miss. How, then, do businesses go about accessing Dubai’s economic opportunities?
The United Arab Emirates offers over 40 “Free Zones” for foreign companies to establish businesses. These Free Zones provide easier startup procedures, less paperwork, and allow companies to be owned, 100%, by foreign nationals. Importantly, businesses established in Free Zones are typically restricted to conducting business within the Free Zones themselves. To access further opportunities outside of the Free Zones, Allegiance International explains that Free Zone Entities (FZE’s) can conduct business with companies outside the Free Zone with help from a local agent or company. Likewise, FZEs can apply to become fully registered “mainland entities”. Another important advantage is that some Free Zones, such as Jebel Ali, allow duty-free imports and transactions.
Allegiance International assists companies as they analyze how best to establish their venture in a Free Zone. With the benefit of local knowledge, their clients are better able to decide how to make a decision that could cost between 20,000 – 120,000 AED annually. Determining a proper Free Zone location could help companies save money and increase their profits as they avoid the high costs related to founding a company outside of the UAE’s Free Zones.
For firms interested in establishing their company outside of a Free Zone. Allegiance International points out that mainland entities are required to observe local laws that mandate certain ownership percentages. Chiefly, a firm must be owned, 51% or more, by a UAE citizen. To navigate this challenge, Allegiance International assists companies in developing their own mainland entity. They estimate the cost of doing so, in comparison to a Free Zone operation, could be roughly 75,000 AED annually.
The Allegiance International Solution
Some entities may wish to set up shop in Dubai, but do not have or are afraid to risk their well-preserved funds to do so. What options do such companies have in the local market?
Allegiance International can provide agency services for any investor or business entrepreneur who wishes to enter the Dubai market. Through their business consultancy unit, they can market the services of any individual or foreign company who wishes to do business in Dubai. In addition, for those who wish to trade in goods, they can partner with known associates, who maintain a general trading license, in order to distribute goods in the Dubai market. Such arrangements are set up at a commission plus registration fee agreement, which serve as risk free and very cost effective solutions for budding businesses.
In a nutshell, the above outlines the three main gateways to the Dubai market.
Why wait for success? Form an Alliance you can trust with Allegiance International today! You can read more about their unique approach and services on their company blog, here.