In Dubai, a professional license, issued by the Department of Economic Development (DED), enables individuals or firms to offer specific professional services within the UAE. Unlike commercial or industrial licenses, which center on trade and manufacturing, the professional license caters to providers of professional services, spanning from medical and IT services to consultancies and artisans offering handcrafted products.
A Professional Service License is granted to professionals who offer their expertise in the United Arab Emirates. This includes architects offering architectural services, product design experts, interior designers, web designers, UI/UX designers, and more. In some cases, groups of professionals may wish to offer their services collectively, such as two attorneys forming a law firm. In such instances, the company would be recognized as a civil corporation.
Companies holding a Professional Service License stand out as they allow 100% foreign ownership, a unique feature not shared by some mainland companies. A Local Service Agent, who can be an Emirati or a company fully owned by Emiratis, is required to represent your company legally before government agencies. The Local Service Agent, without any ownership or management control, grants you complete autonomy over your business.
Companies holding a Professional Service License enjoy 100% foreign ownership, unlike some mainland companies. You only need a Local Service Agent to represent your company before government agencies. The Local Service Agent can be an Emirati or a company entirely owned by Emiratis, with no ownership stake or management authority in your business. This arrangement gives you full control over your business.
Establishing a professional company in Dubai necessitates obtaining a professional license. The primary advantage of holding a professional license in Dubai is the ability to have 100% ownership of the company. In contrast, trading companies require partnership with a UAE national, mandating the allocation of 51% or more shares to the partner. However, professional companies diverge from this norm, providing the license holder with complete ownership through an arrangement with a local service agent.
Generally speaking, a professional is someone who is trained to offer a service, making them specialists in their respective fields. Some of the common business activities / professions that require a Professional Service License include:
Choosing the right business structure is vital when launching a firm in Dubai. Options include:
Consider factors like your business services, target market, and long-term goals when selecting a structure, and consult legal and business experts for guidance.
The Department of Economic Development (DED) outlines the steps for establishing a business in Dubai, with the following procedures for obtaining a professional license:
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Selecting from over 2,000 listed activities on the DED Dubai website, applicants can identify professional category activities.
Based on business type, activities, and owner nationality, choose an appropriate legal form corresponding to the selected activity.
Submit a trade name application related to the chosen business activity, pay reservation fees within 72 hours of receiving the transaction number.
Apply for the Initial Approval Certificate, an official confirmation from DED allowing the start of a business in Dubai mainland.
Depending on the legal form, sign a Local Service Agent (LSA) agreement with a UAE national for licensing and compliance representation.
Provide a physical address, sign a tenancy contract with the landlord, and register the contract with Ejari for attestation.
Check if the business activity requires approvals from government bodies, as listed by the Business Registration and Licensing Sector in DED.
Submit necessary documents online or to authorized service centers, including initial approval receipt, attested lease contract, attested memorandum of association, and any applicable government approvals.
Remember that the process may vary depending on your chosen jurisdiction and business activities. Consulting legal and business experts familiar with Dubai's business setup landscape is highly recommended.
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Submitting incorrect documents can lead to immediate rejection. Our consultants at Smart Zones® UAE ensure you have the right documents, avoiding any complications in the process.
The cost of obtaining a Professional Service License varies based on your business activity and the number of business owners. Additionally, you should consider the cost of company formation. A business setup consultant experienced in company formation can provide a comprehensive quote for the entire process. For a free quote, please contact us.
Your Professional Service License must be renewed annually. During renewal, it's crucial to ensure that your professional credentials remain valid. If your profession requires time-bound credentials, consider re-certification to maintain valid credentials when renewing your Professional Service License. You can apply for renewal one month before its expiration date, extending its validity for another year. Late renewal may incur penalties, and business operations cannot continue until the renewal is approved by the Department of Economic Development in your emirate. A Dubai business setup consultant can assist with the renewal process.
A Professional Service License in Dubai, issued by the Department of Economic Development (DED), allows individuals or firms to provide specific professional services within the UAE. It is suitable for professionals offering expertise in various fields, such as architects, designers, consultants, and artisans. Groups of professionals can also form companies recognized as civil corporations under this license.
The key distinction is the allowance of 100% foreign ownership, a unique feature not shared by some mainland companies. A Local Service Agent, either an Emirati or a company fully owned by Emiratis, is required for legal representation, without any ownership or management control. The benefits include 100% foreign ownership, no corporate or personal income taxes, repatriation of capital and profits, easy license renewal, a stable business environment, and access to a wide market.
A professional company in Dubai, established with a Professional Service License, offers complete ownership to the license holder. This contrasts with trading companies that require a partnership with a UAE national, involving the allocation of 51% or more shares to the partner. The Professional Service License arrangement includes a Local Service Agent but grants the license holder full control over the business.
Business activities covered include a wide range of professional services such as accounting, advertising, architectural consultancy, beauty salons, IT services, legal advisory, medical services, and more. Essentially, any service provided by a trained professional falls under the purview of a Professional Service License.
The two main business structures are Free Zone Company and Mainland Company. A Free Zone Company offers foreign ownership and simplified registration processes, suitable for global operations. Mainland Companies adhere to UAE laws and regulations and are suitable for businesses targeting the domestic market. The choice depends on factors like business services, target market, and long-term goals.
The steps involve partnering with Smart Zones® UAE, selecting a business activity, choosing a legal form, deciding on a trade name, applying for initial approval, signing the LSA agreement, establishing a business location, obtaining licensing approvals, and finally, the issuance of the license. Each step is crucial, and a business setup consultant can guide through the process, ensuring compliance with regulations.
The required documents include the application form, passport copies of expatriate business owners, Emirates ID copies (if residents), visit visa copies (if applicable), passport and Emirates ID copies of the local partner, NOC from the expatriate business owner's sponsor, and additional approvals specified by the DED. Submission of incorrect documents may lead to immediate rejection.
The cost varies based on business activity and the number of business owners. Additionally, considerations for company formation costs should be taken into account. Business setup consultants experienced in company formation can provide a comprehensive quote tailored to the specific requirements.
The Professional Service License must be renewed annually, ensuring professional credentials remain valid. Renewal can be applied for one month before expiration, extending the license's validity for another year. Late renewal may incur penalties, and a business setup consultant can assist in navigating the renewal process to ensure smooth operations.