In the United Arab Emirates, Dubai is a connecting point between Europe, Asia, and Africa and a strategic point for those looking to expand their operations worldwide. Today Emirates is home to hundreds of global brands because the UAE Government is providing a favourable environment to investors from all over.
However, though the UAE is a business paradise for the international business community due to a promising commercial ecosystem, there are many do’s and don’t to consider for a smooth and hassle-free business. Companies looking to establish their business in Dubai need to understand certain factors concerning business practices, local culture, customs, and manners to grow with the booming economy successfully.
Here we will find out the dos and don’ts of doing business in Dubai.
The Do’s of Doing Business
1. Select the Right Company Formation
There are three main types of company formations in the United Arab Emirates – Mainland, Free Zone, and Offshore. Make sure you have done proper research and understood what will suit your business activity before determining the company formation, as each one comes with its own set of advantages and disadvantages, geographical limitations, and trading restrictions. Since your decision will have a long-lasting impact, consult a company formation consultant to understand the process and legal requirements.
2. Obtain the Right Licence
Depending on your business activities, business goal, requirements, choose from three types of licences — Commercial, Industrial, and Professional. For example, companies engaged in trading activities, like sales, opt for a commercial licence, those in manufacturing should obtain an industrial license, and for personal skills and services, such as legal advice, consultancy, a professional licence is needed. Choose your license carefully as it will have a long term impact on your business.
3. Find a Trustworthy Local Sponsor
A limited liability company (LLC) is the most preferred type of company in the UAE, and it requires an appointment of a local sponsor/agent (UAE national) for registration. The local sponsor owns 51% of the total share of the company. Therefore, it is vital to find a trustworthy local sponsor. In addition, local sponsors are very helpful in managing official formalities, approvals, and processes.
4. Fix Your Visa Requirements
Visa is one of the essential requirements to run your business in the UAE. Obtaining an investor visa is neither complex nor time-consuming. The issue of a work visa depends on your business type and duration. A local sponsor again can be in the visa application process.
5. Build a Team with a Potential Partner
Ensure to build a talented team with strategic partners. Though UAE has full potentiality, you will face stiff competition. Therefore, to reap maximum benefits, you must look for mutually beneficial partnerships with known players in the market.
The Don’ts of Doing Business
1. Don’t be too Informal
How you make deals play an essential part in terms of overall business protocol. When you are in the UAE, you will have to follow the business formalities of the UAE. It is essential to be aware of the cultural characteristics and business etiquette before you start doing business in any country, and it is the same for the UAE too.
2. Don’t Work in Silo
The UAE is resonating with commercial activities. So, when you come here to start your business, take advantage of all the activities you see around. Do not keep yourself away from all the buzz you see in the market. It makes sense to interact and socialise to create awareness about your business to gain ground in your industry. As you communicate with people and build networks by holding conferences, events, meetings, and public activities, your opportunities to grow in business will increase.
3. Don’t Get Confused – Consult a Professional
If you are new to business or UAE, it is quite natural for you to get confused about many things while setting up your business. Instead of getting confused and complicating everything, it is better to take professional help right from the beginning. Involve local professionals for business setup in Dubai (UAE) who can assist you through legal and official processes, which can be confusing in the absence of expected knowledge.
4. Don’t Hesitate to Ask for Written Commitments
Make sure you have everything in writing and do not trust verbal assurances. All partnerships or agreements should be in black and white and attested by the authorities to avoid future conflicts and legal troubles.
5. Don’t Hurt the Local Sentiments
The United Arab Emirates has a cosmopolitan lifestyle and a multi-cultural people. People with different nationalities here have mutual respect for each other. Therefore, it is vital for businesses coming here to be in sync with the local, religious, and cultural belief systems. Ensure, even by mistake, you do not hurt people’s religious and cultural sentiments at any point in time. It can adversely affect your business.
The above guidelines, if followed religiously, you can quickly become part of the UAE’s burgeoning economy,