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Hi,

I am munching on the idea to obtain a business license. Options are massive especially regarding consultancies.
Most of them cost a fortune, once talking about prices ends up
I have checked on RAK Freezone and Freezones in Dubai. But it seems to me that in my area of specialization the LLC is the only opportunity. Does anyone have in general some tipps for me how to obtain a License for a lower price?
Appreciate it if you share your experiences. Many thanks in advance!

Cheers and happy Friday!

Sorry, I don't have any tips, but I hope someone else reading this can help you. Good luck with starting your business.

You can't unless you share it with somebody. Licencing fees, if you are not buying a trade licence, then it is just fees to the govt or free zone authority. They are not negotiable.

Kanelli, thanks a lot for the best wishes

Nucleus, thanks for commenting. I know that it is just fees. I do have a partner - that's the great news.
I have checked out RAK FZ, but you are not entitled to do business outside the FZ (as in all the other FZ's).
And you never know if from one day to the other they will enforce it.

Hope someone in the forum may read it and has an idea or at least a hint for me. Social entrpreneurship is
very much needed here, me thinks.

Good day to all!

--- Jun 24, 2012 ---

Nucleus , is that possible to buy a trade license? Would you mind sharing some details about that with me? Many thanks!

You can do business outside FZ, but you can't operate from outside FZ. For example if you have a products, you can sell and deliver to customers outside FZ.



As for buying a trade licence, when you buy a company basically you are buying their trade licence along with other assets that belong to that company. govt fee doesn't change but it is only 50 to 200k. But if a company is established brand their value can go up to couple of millions and hence negotiable between seller and buyer. But it won't be less than the govt. trade licence fee, unless company is nearly bankrupt and owner(s) just want to dump it.

--- Mon Jun 25, 2012 4:17 am ---

Another thing, depending on the trade licence, they have to be renewed after time. So even if you are buying a bankrupt company and lets just say owner just gave it to you, you will still incur trade licence transfer fee and renewal fees.

Nucleus ,

thanks a lot for this valuable information! I appreciate it and it helps me a lot further.

That is actually what I am aiming to do just not a multimillion dollar business. As much as I oversee the market, many business owners sell their license as they may want to leave the country, trying to make some more money before going. The transfer and renewal fees shall not be a problem as they aren't that insane high, according to the Economy Department.

As a matter of security it is mandatory to make a background check on the license and what hangs at it.

Some people say that Freezone isn't necessarily "cheaper" (running a business and the word cheap don't match anyway) - it is just the 100% ownership.

Okay, once again thanks so much for your answer. I'll get clarity on the subject and will post the progress here.

Very good day, Mostlysunny

Nucleus ,

Let's imagine this:

I want to run my own service agency.The customers will be outside the Free Zone.The reason I want to set-up FZ business is that don't need all that hassle when it comes to get a sponsor. As all the customers are outside the Zone-Dubai,UAE,Oman, is it possible to run a a business like that?thanks

romanm ,

this is a good question. Actually as much as I found out, it is kind of a grey area. A lot of FZ Businesses do that, but once you form a company in a Freezone the brochures and the small prints clearly say: you can only operate from inside the FZ. Means: you can't have an office outside the FZ and operate from there.

Moreover I think it is the matter of the right license.

romanm wrote:I want to run my own service agency.The customers will be outside the Free Zone.The reason I want to set-up FZ business is that don't need all that hassle when it comes to get a sponsor. As all the customers are outside the Zone-Dubai,UAE,Oman, is it possible to run a a business like that?thanks

Yup, and lot of companies are doing that. It depends on the nature of the business too. Service as in consultancy where there is nothing physical would have no issues operating like that. But I also know IT companies who install networking and computer equipment outside FZ area, not sure that is legal, but I see lot of companies operating like that. But what is clear is that you can't have office outside FZ for sure. Other than that I see lot of companies sending people to their customers to install, sell, etc...

My idea is to run small business based on agency principle,selling the services of the other companies(from Dubai).100% customers will be outside the FZ. Do you thing is it legal to operate like this?

As far as I know there is no requirement to have customers inside FZ (may depend on specific FZ terms too), but you only have to operate from FZ. You can provide services from FZ to outside customers, thats what many companies are doing. But for specific answer better ask lawyer. I know the businesses, and see many businesses operating like that, but I'm not a lawyer.

Choosing the right Free zone for my business.

As there are many Free Zones in the UAE what could be the best option for me? I need just 20m2 office space, nothing special.My concern is the price and the location, I will come from Oman for 2-3 days a week to work there.

romanm ,

If you have made sure you have advantages in a Freezone regarding the nature of limitations etc one of the fairest options is RAK Freezone, JLT in Dubai. Contact them to get advice what and how to do it.

But get everything black on white. Hope that helps you out a little bit. Most success to you!

--- Jul 12, 2012 ---

Hi All,

I will come up with a summary of my research and will provide details on FZ vs Mainland LLC.

Good day to everyone!

Guys, Thank you for the post and the replies. So far, it's been very helpful for me.
Could you please direct me to the right sources or share your knowledge about the taxes and procedures in none-FZs. I'm researching about opening a sports facility like paintball, football, tennis court etc... And it seems that you can't hire or find any warehouse in FZs.
Any kind of information would be eureka for me at this stage.

Thank you in advance.

Hi all interested in this topic,

as promised I come up with a summary of what I have found out in my researches. First of all, let me tell you: DO YOUR HOMEWORK properly before you get the License itself. Sounds ridiculous but in fact it saves you from running into difficulties.

Freezones: FZ's offer a variety of opportunities FZ Co, FZE, FZ LLC, Freelance work. The major advantage is the 100% ownership. A disadvantage is that you are officially not allowed to do business outside the Freezone or set up an office on the mainland as the FZ isn't considered to be in the UAE. Depending on the content of your business keep this in mind.

Mainland LLC: Your partner (local sponsor) is the key to success. There are several types of licenses 1.commercial, general trading, professional|services.

If a professional|services license suits your business (for certain professions like doctors, lawyers etc.) you can own it 100% too but you have to appoint a local service agent (almost like a sponsor). There is no tax in general BUT you pay 5% of the rental contract yearly on top. Then you are fully liable with all your assets!!

The form of an LLC reduces your risk (as the name says it).

The license costs can be looked up on the department of economic development website which provides good info. You can also go there, line up and talk to a competent person there.

If you want to buy a second hand license, before you put the money on the table: thorough check on visas taken on the license, loans hanging on to it etc. Make sure it is a good product you buy!

Incase you make a fresh license: depending on your business calculate between 12.000,-+Dhs. + visa costs + notarization of MoA etc. Then you actually know how much money you have to take in your hands to hit the market.



That was all for now.... time to get professional Wish you all a great Iftar today....

Mostlysunnny,

Thank you for the update. Now we have the right path. Really helpful. Much appreciated.

I still wanted to ask you about the taxes. Do you know anything about the taxes via LLCs?

Does the company should pay taxes from its income? If yes, what are the specifications?

This will really help me to form the pre-plan.

Have a great iftar too.

Hi usebat ,

Very much on the same highway Okay, taxes... As much as I know by research you pay only the 5% on top of the yearly rent fee.

Another point to mention is that with an LLC, you need to create accounting records | bookkeeping. Also calculate the renewal fee for

the License, the Visa fee(s), DEWA for the office and entity, etc.

There is no such thing as income tax as for example in Europe. I will check on this issue again too. Once I gained all, I will post it here.



Enjoy your Iftar & the adventure of being an entrepreneur here! Life's an adventure....

--- Oct 08, 2012 ---

Hi All,

76 days ago the topic posted. As of now I could write a book already.
To make a long story short: homework properly done, all is set. We can take off.

BUT one thing you can take for granted - getting a License here is something you will never forget.

And now the adventure is about to start. Good luck to everyone who starts!!

There are no issues in offering offering services outside the freezone. Ur office n all staff need to be in freezone visa.

rajthechanp , In the beginning I thought so too. But legally are quiet a few things you need to consider when you want to enter the mainland market. You need to either register a branch of your FZ Company on the mainland. Or you need to have a local Service Agent! Both cost and have to be registered by the DED.

I have gone deeply into it. And all sources say the same. It is understandable as the FZ's aren't considered to be in the UAE.

That is quite hard thing to do specially if you are building a business in other country like this country.Well in Finland country many business are really having difficulties not only for license but also on giving customer service.In part of Helsinki many business use to hug call center at http://www.protone.fi/ which is really helpful on getting customer satisfaction and give's a lead to business.

Dear All,,

I am UAE national businessman based in Abu Dhabi but operating small to medium businesses in Dubai, Abu Dhabi, Sharjah and rest of the UAE. I can be your local partner or sponsor to establish any type of business anywhere in the UAE for annual fee basis depends on the type of business. I'm well educated and professional person so I expect the same from you. Is this what you looking for? call/text/whats app 00971529806240.

Best Regards,
Omar