Business setup in Abu Dhabi

Abu Dhabi, the capital of the United Arab Emirates, is a popular business hub with a growing economy and a strategic location in the Middle East. Entrepreneurs looking for business setup in Abu Dhabi can benefit from its stable political environment, strong infrastructure, and business-friendly regulations.

Abu Dhabi witnessed a significant surge in new business licenses issued in the first half of 2023 and that demand seems to continue in 2024 and the coming years. Sectors like e-commerce, technology, and sustainable solutions are experiencing particularly high demand, driven by the region's growing tech-savvy population and the government's focus on diversification.

If you’re an entrepreneur considering Abu Dhabi as your dream business destination know that the business setup process in Abu Dhabi can be complex and requires a thorough understanding of the requirements, costs, and procedures involved.

Therefore, here we will explain everything you need to know about business setup in Abu Dhabi including benefits, types of business licenses, the process, cost, and more.

Benefits of starting a business in Abu Dhabi

Abu Dhabi offers a number of advantages for entrepreneurs looking to set up a business in Abu Dhabi. Here are a few of the key benefits:

1. Strong Economy

Abu Dhabi has a diversified, stable economy, fueled by its hydrocarbon reserves and a growing focus on non-oil sectors. This strong economic base provides a secure environment for businesses to operate.

2. Government Support

The Abu Dhabi government actively supports businesses through a variety of initiatives, including tax breaks, subsidies, and free zones. These incentives can help businesses to reduce costs and grow their operations.

3. Ease of Doing Business

Abu Dhabi has made significant strides in recent years to simplify the process of setting up a business. There are a number of streamlined procedures in place to help entrepreneurs get up and running quickly.

4. Skilled Workforce

Abu Dhabi's diverse and educated workforce provides businesses with access to talent across various industries.

5. Quality of Life

Abu Dhabi offers a high quality of life, with a safe and secure environment, a variety of leisure activities, and a multicultural population. This can be attractive for both entrepreneurs and their employees.

6. Strong Trade Ties

India and the UAE have a long history of trade and cultural exchange. This familiarity can make it easier for Indian businesses to navigate the business environment in Abu Dhabi.

Types of Business Licenses Available in Abu Dhabi

Businesses can obtain various licenses in Abu Dhabi depending on their activities, industry, and ownership structure. Here are some of the main and popular licenses:

1. Commercial License

This is the most common type of license, and it is required for businesses that trade goods and services within and with the UAE. This license is ideal for businesses involved in import, export, retail, wholesale, distribution, restaurants, cafes, etc.

2. Industrial License

This license is required for businesses that are involved in manufacturing or industrial activities. This includes businesses that produce goods, such as factories, workshops, and assembly plants.

3. Professional License

This license is required for businesses that provide professional services, such as consultants, lawyers, accountants, engineers, doctors, architects, and other freelancers.

4. Tourism License

This license is required for businesses that operate in the tourism sector, such as hotels, travel agencies, tour operators, restaurants, cafes, and entertainment venues.

5. Freelance Permit

Freelancers in Abu Dhabi can obtain a freelance permit to legally offer their services in various industries such as writing, graphic design, photography, web development, consulting, and more. This permit allows individuals to work independently without the need to establish a formal company structure.

There can be other licenses including Agriculture licenses, Craftsmanship licenses, Healthcare licenses, Education licenses, etc.

In addition to these main categories, there are also free zone licenses available in Abu Dhabi. Free zones offer specific benefits to businesses, such as 100% foreign ownership and tax exemptions. The type of free zone license you will need will depend on the specific industry your business operates in.

Types of Business Structure in Abu Dhabi

Business setup in Abu Dhabi offers two main options for establishing your business: setting up on the mainland or in a designated free zone.

1. Mainland Business Entities:

• Suitable for businesses that want to operate within the entire UAE, including Abu Dhabi and other emirates.
• Offers wider business scope compared to free zones.
• 100% foreign ownership (unless in specific sectors).
• Subject to corporate tax (typically 5%) after a certain limit.
• More complex setup process and regulations.

2. Free Zone Business Entities:

• Ideal for businesses with a focus on international trade and export.
• Generally allows 100% foreign ownership.
• Offers tax benefits, typically with no corporate or personal income tax.
• Streamlined setup process and regulations.
• May have restrictions on doing business within the wider UAE.

It's advisable to consult with a business setup specialist in Abu Dhabi at Shuraa to determine the most suitable option for your situation.

Documents Required for starting a business in Abu Dhabi

• Passport copies and visa details for owners and managers
• Proof of address (residence visa)
• Business plan
• Memorandum of Association (MOA) (if applicable)
• Lease agreement for your office space
• Local sponsor details (if applicable)
• No Objection Certificate (NOC) from current employer (if employed)

How to Start a Business in Abu Dhabi?

The requirements for Business setup in Abu Dhabi will vary depending on whether you choose the mainland or a free zone, and the specific type of business entity you select. Let’s dive into the key steps to start a company in Abu Dhabi.

1. Choose a Business Activity

Identify the specific activities your business will engage in. This will determine the type of license you need.

2. Select a Legal Structure

Decide on your business entity type (LLC, sole proprietorship, etc.) based on ownership preferences and regulations.

3. Register Your Trade Name

Choose a unique and available trade name that complies with government regulations.

4. Company Registration

Submit the required documents to register your business with the Abu Dhabi Department of Economic Development (ADDED) or relevant authority.

5. Secure Business Location

Finalize your office or commercial space and obtain a lease agreement.

6. Bank Account Opening

Open a corporate bank account for your business with a local bank in Abu Dhabi. 

7. Apply for Additional Approvals

Depending on your industry, you may need approvals from other government entities.

8. Pay Fees and Collect Licenses

Once your application is approved, pay the necessary fees and obtain your trade license and other relevant licenses.

9. Employment Visa Processing

If you plan to hire employees, initiate the process of obtaining employment visas for them. This involves submitting visa applications, medical tests, Emirates ID applications, and other required documents to the relevant authorities.

It's recommended to consult with a business setup specialist at Shuraa in Abu Dhabi for the most up-to-date requirements and to ensure a smooth process tailored to your specific situation.

What is the Cost of Business Setup in Abu Dhabi?

The cost of obtaining an Abu Dhabi business license typically starts from AED 15,000 to AED 50,000. However, the overall cost can vary significantly depending on several factors, including:

• Business activity
• Business structure (Mainland or Freezone)
• Number of visas
• Business Location
• Government fees
• Office rent
• Business activity
• Bank charges
• Complexity of business
• Additional approvals and permits

If you're an Indian entrepreneur or foreign investor, many free zones offer pre-designed packages that bundle license fees, visa quotas, and basic office facilities at a discounted rate. Explore options from free zones catering to Indian businesses or specific industries you're interested in.

For a more accurate estimate, it's best to consult with a business setup consultant in Abu Dhabi. 

How Shuraa Business Setup Consultants Help You?

Abu Dhabi offers a fertile ground for Indian entrepreneurs or foreign investors seeking to expand their business reach or launch new ventures. The streamlined setup process, abundance of resources, and government support for foreign investors make Abu Dhabi an attractive business destination.

For Indian entrepreneurs or foreign investors seeking a trusted partner for handling their business setup process, look no further than Shuraa Business Setup.

At Shuraa, we understand the unique needs of Indian businesses or foreign investors and are committed to providing a seamless and cost-effective solution. Our comprehensive services include everything you need to get your business up and running. From company registration and licensing to PRO services, office space acquisition, and visa assistance, we are your one-stop solution. 

Don't wait any longer. Contact Shuraa Business Setup today and let our experts guide you through every step of the process.