Business Setup UAE: How to Form a Company with a Professional License in Dubai
Professional entrepreneurs planning a business setup in UAE often consider Dubai due to its business-friendly environment, robust infrastructure, and legal support for professional services. Setting up a company with a professional license in Dubai is straightforward when you understand the process, documentation, and legal requirements.
What is a Professional License in Dubai?
A professional license in Dubai allows individuals and groups to practice a profession they are qualified in, such as consultancy, healthcare, education, accounting, or legal services. This license is issued by the Dubai Department of Economic Development (DED) and is an essential requirement to operate legally in Dubai’s mainland.
Benefits of Business Setup in UAE with a Professional License
There are several reasons why obtaining a professional license benefits your business setup in UAE:
- 100% foreign ownership is allowed through a local service agent agreement.
- Access to Dubai Mainland, which offers greater flexibility in clients and contracts.
- Reduced capital requirements compared to commercial licenses.
- Legal protection under UAE laws.
- Prestige and recognition for qualified professionals.
Key Steps for Business Setup in UAE with a Professional License
Launching your business setup in UAE under a professional license involves several legal and administrative steps. Below is a detailed guide to take you through the process.
1. Determine Your Business Activity
The very first step is to identify the exact nature of your business activities. The DED provides a list of permissible professional activities. It’s crucial to choose an activity that aligns with your professional qualifications and expertise.
2. Choose a Legal Structure
Most professional licenses in Dubai mainland are issued to sole proprietorships or civil companies. A sole proprietorship is ideal for one individual, whereas a civil company suits partnerships.
3. Appoint a Local Service Agent
For 100% foreign-owned professional companies, it is mandatory to appoint a local service agent (LSA) who will facilitate licensing and immigration matters. Note that the LSA doesn’t hold ownership but is compensated annually for their services.
4. Reserve Your Trade Name
Submit a set of proposed trade names to the DED for approval. Ensure the name is relevant, unique, and complies with the UAE naming conventions.
5. Apply for Initial Approval
The initial approval certificate from DED indicates that the UAE government has no objection to you starting a business in Dubai. This document is essential to move forward with your business setup in UAE.
6. Prepare a Memorandum of Association (MOA)
Even for professional licenses, an MOA detailing the partnership agreement or sole proprietorship declaration must be notarized and submitted to DED.
7. Finalize Office Space
Professional companies are required to lease a physical office space in Dubai. The tenancy contract will be registered through Ejari (Dubai’s official leasing system).
8. Submit Final Documents and Pay Fee
Prepare and submit all documents, including:
- Trade name reservation certificate
- Initial approval
- MOA
- Ejari tenancy contract
- Passport copies of owners/partners
- Local Service Agent agreement
Once submitted along with the required fee, DED will issue the professional license and you can officially operate your business.
Licensing Timeline and Cost
The timeline for obtaining a professional license in Dubai can range from 3 to 10 working days. The cost of business setup in UAE varies based on several factors, but here’s an estimated breakdown:
- Trading Name Reservation: AED 620
- Initial Approval: AED 120
- Professional License Fee: AED 10,000 – AED 17,000
- Local Service Agent Fee: AED 5,000 – AED 12,000 annually
- Office Rent (Average): AED 20,000/year
Types of Professions Eligible for Professional License
You can form a company under a professional license in Dubai for various services including:
- IT and Tech Consultation
- Legal and Financial Advisory
- Healthcare Services
- Design and Creative Services
- Education and Training
- Management Consulting
Common Challenges and How to Overcome Them
While the process is straightforward, some entrepreneurs face hurdles. Here are a few tips to mitigate them:
- Confusion about activity codes: Consult the DED’s full list or use a business consultant.
- Finding a reliable LSA: Always vet agents and ask for referrals or reviews.
- Understanding document requirements: Seek professional help to avoid errors or rejections.
Legal Responsibilities After Registration
Once your company is operational, you must comply with local regulations:
- Renew your trade license annually
- Ensure your tenancy contract is current
- Submit annual financial audits (for specific sectors)
- Keep corporate bank accounts up to date
Why Business Setup UAE Is Easier with Professional Help
Engaging a reputable business setup consultancy can reduce stress, save time, and ensure full compliance with UAE laws. They assist with documentation, licensing, legal translations, and local agent arrangements.
If you’re interested in more specific setup processes, check our in-depth guide: Step-by-Step Guide to Opening a Company in Dubai.
Final Thoughts
Establishing a company in Dubai with a professional license is one of the most common routes for skilled professionals planning business setup in UAE. With the right knowledge, documentation, and support, you can efficiently navigate the process and launch your successful business in the Emirates.
Learn more about regulations from the UAE Government Portal.
