Relocating Your Business to Dubai – A Comprehensive Checklist for the UAE Move

Relocating a business means expanding/branching out or shifting your business from one place to another. Businesses relocate for a multitude of reasons and the best one to shift is to seize opportunities in different business markets. Relocation also helps established businesses to maintain the peak stage of their business cycles as seeking new markets can increase sales and create business growth.

In order for the business shift to work successfully, you need to choose a suitable location. Often it is better to move to emerging markets because they have high growth potential, Dubai has become a popular relocation destination and it is because of its diverse youth population that it presents such an exuberant market for businesses.

Besides, the city of Dubai presents numerous other benefits including the facilitation of modern infrastructure, tax benefits, and a strategic geographical location among others. With this in mind, relocating a business requires intensive research to be carried out. 

Familiarizing yourself with all the relevant information beforehand can help you avoid mistakes, which in turn will allow you to reduce costs. This article will provide a checklist that will aid you in your business move.

Three Things to Keep in Mind

Firstly, you must select the right business jurisdiction because it is a decision that will heavily impact your costs. The UAE has three types of jurisdictions including the mainland, free zone, and offshore. Dubai alone has 26 of the country’s more than 40 free zones, each catering to a number of business activities. 

UAE is globally renowned for having the best free zones, in 2024 Jebel Ali Free Zone of Dubai ranked number one worldwide. This jurisdiction comes with the benefits of full foreign ownership, tax exemptions, customized infrastructure and business policies, and others. In comparison, the mainland jurisdiction offers businesses to operate all across the UAE, unlike free zones which host businesses usually involved in international trade. 

However, mainland businesses are not exempt from taxation unless their business activity falls below the taxable income. Another jurisdiction that is exempt from taxation is offshore, this jurisdiction offers businesses privacy, asset protection, and does not require a local presence. But like free zones needs a local sponsor to operate within the UAE. Therefore, choosing a suitable jurisdiction requires intricate attention to detail.

Once you have decided on your business jurisdiction, you need to analyze the laws and regulations governing that area. Look into the standard business license requirements, company ownership, and foreign investment laws, and maintain compliance with Dubai’s regulatory framework. Knowing the requirements of the law can help you fast-track your business setup in Dubai process and save you from incurring penalties.

Further, ensure you research industry-specific requirements as certain industries require additional approvals. Moreover, industry-specific authorities have particular documentation requirements such as the Virtual Asset Regulatory Authorities (VARA), Dubai Land Department (DLD), and certain free zones authorities as they are separate from the mainland entities. 

Preparing for Relocation – Steps Involved

Having established that intensive and extensive research is needed, other steps include:

1. Drafting a relocation plan:  Specifying the business goals, target market, timeline of move, and budget. The latter tends to be the most important and unfortunately the most neglected. Sure, Dubai has ample opportunities for all businesses but your business needs to have the potential to bear the costs of the move.

Hence, planning each step is vital, and setting a deadline for your plan is essential as procrastinating and lengthening the process leads to increased costs. Consider the costs of license registration, hiring employees and applying for their visas, license annual renewal, and office or store rent as these tend to be the big and sunk costs. 

2. Choosing the business location: this step can lower your business’s costs as many locations are cheap and many free zones provide cost-effective packages including office space and visas. Other than this your business location must be accessible for your customers.

If you aren’t located close to your target market, you run the risk of failure with the additional expense of finding a new and better location. So making this decision correctly the first time is important.

3. Selecting the right business structure: the ownership structure of your business needs to be suitable for your business operations so you can execute your business activities legally.

Among the available structures are the sole proprietorship, partnership, Limited Liability Company (LLC.), Public Limited Company (PLC.), and a branch office. Each structure has different documentation requirements such as the limited companies have to submit MOA, AOA, and shareholding agreements.

4. Opening a Corporate Bank Account: ensuring your business is eligible for a business bank account in Dubai will make the account opening process easier as using a business account for business transactions signifies professionalism.

Being rejected can ruin your chances of applying again, so gather proper documentation in line with compliance. It is best to make it right on the first and also ensure the bank is the right fit for your business transactions and that it offers the features your business needs.

5. Understand the tax and accounting compliance: as aforementioned understanding the laws your business will be subjected to can prevent your business from being incriminated and fined. 

This can significantly add to your costs thus, forecasting costs beforehand will be helpful.

Challenges and Tips to Overcome Them

On the other hand, relocating your business doesn’t just involve setup challenges but also operational challenges. Not understanding the local market competition is one of them, dedicating time to research and understand the local culture and business etiquette can help you compete in the market. 

Notably, you may face language barriers when relocating, and hiring employees familiar with the local markets can prevent mistakes that may damage the business’s reputation. Another challenge would be logistics if your business is selling a product instead of a service, you need to carefully plan the transportation of your goods.

Working with the right local partners and business advisors who can connect you with suitable logistic companies. Local partners and business advisors can also set you up with other complementary services your business may require from time to time, this could include legal, PRO, accounting, tax service providers, and others.

With the global economy stagnating after the pandemic, businesses must explore new markets to keep operating and Dubai being a city with a growing and upcoming population presents the perfect opportunity.

To correctly take advantage of this opportunity, you need to seek proper support and planning. Especially from a professional experienced in the local markets, this will ensure a seamless relocation of your business.

What are you waiting for? Hop onto the flight to business success in Dubai!

To escape the legal hassle whilst complying with the regulations, contact our professionals.