As time progresses, technologies continue to grow and thrive. With more and more individuals turning to and relying on the digital world, we are witnessing an upsurge in e-commerce businesses. This is why starting an online business in Dubai has become an ideal business move for entrepreneurs.
As the pandemic came into the picture, most businesses had to use online platforms. This was because most individuals started to rely solely on their phones or laptops when in need of something. Digitization is undoubtedly going to be a major player in the relevancy of businesses now and in the future.
This is why taking advantage of the world of technology would undeniably enable businesses to create their mark on the online platform and boost any business’ reach.
In this blog, we explain everything you need to know about how to start an online business in Dubai.
Steps to Start an Online Business in Dubai
To start an online business in Dubai, you need to follow the below steps:
1. Choose the right jurisdiction for your online business
When deciding on the most suitable jurisdiction for your online business in the UAE, there are two options:
Mainland
Mainland is also often called onshore. Businesses working on the mainland can operate across the UAE and in the international markets. Companies formed on the mainland are licensed by the Department of Economic Development (DED). Mainland companies also have the advantage of having no cap on employee visa quota depending on the size of the office. They can also easily take on government projects.
If you choose the mainland as your preferred jurisdiction, the UAE national must be an agent. Your e-commerce business cannot be set up as a Limited Liability Company (LLC).
Free Zone
However, businesses formed in free zones benefit from having no customs duties or taxes for trade within free zone boundaries. This boosts trade, especially when it comes to imports and exports. Free zones offer an array of activities emphasising logistics and trade. These jurisdictions are also referred to as free trade zones.
If you choose the free zone as your preferred jurisdiction, you do not require an agent. You can also establish your online business as a Limited Liability Company (LLC).
Choosing between the options of conducting business on the mainland or free zone will depend on the nature of your online business as well as the market reach.
2. choose the perfect company name and obtain your initial approval certificate
Although this may not be the biggest priority for most, your company name is more important than you might think. It is important to remember that the UAE has a strict set of conventions when it comes to your trade name. It is vital to abide by these rules to have your trade name approved by the authorities.
When choosing a name for your business, you must follow these rules:
- If you wish to have the name of your company after your name, it should be your full name or your surname. Abbreviations or initials are not permissible.
- No offensive language or profanity
- References to Allah are prohibited
- No use of politically charged terms
- No sectarian or political groups
Lastly, after picking your company’s name, you must check the availability of the name for registration by the authorities.
When applying for your license, you will need to submit various documents including:
- Application form
- Passport copy
- Coloured passport photos
3. Start the process to obtain your online business license
Once the initial process of determining your jurisdiction and location is done, you can apply for your online business license. The type of license you will need will depend upon the nature of your business, and activities, and the jurisdiction you choose.
The authorities in Dubai will issue your online business license. The process of obtaining your license will take about a week and will have to be renewed every year. When applying for your license, you must also provide details about all the social media channels and accounts related to your business.
During the application process for your online business license, you will also be required to draft and submit a Memorandum of Association (MOA). This additional step is only applicable if you pick the mainland as the jurisdiction for your online company.
4. Follow the application process to acquire visas
One of the many benefits of starting an online business is that you do not require office space or be physically present in the UAE to conduct it. However, you will need a legal address to conduct it in accordance with the UAE rules.
If you do want to have a physical office in Dubai, you and your employees will need to have a valid visa. Having an online business license in Dubai enables you to have a valid visa for 3 years, which should be renewed every year.
The number of visas you can acquire will depend upon the size of your business and jurisdiction. With an online business license, you can also sponsor dependents such as family members and employees.
5. Open a Bank Account in Dubai
Lastly, you can open your corporate bank account once you obtain your license and establish your online business. Opening your bank account is quick and simple. All you need to do is pick your preferred bank and submit the following documents:
- Passport copy
- Emirates ID
- Visa copy
- Business license
Why Choose Dubai for Starting an Online Business
Undoubtedly, most individuals turn to their phones or laptops when they require something. This inevitably increases your reach. But this isn’t all there is when starting an online business. There are various benefits to starting your online business in Dubai. These include:
- Full profit repatriation: Companies can repatriate all their profits to their home country. This allows them to transfer 100% of their capital to their place of origin without any requirements.
- Full ownership of business: Depending on their activity, jurisdictions permit foreign investors to acquire 100% ownership of their business.
- Fast and easy setup process for acquiring a business license.
- Economical setup and operating costs.
- No personal tax.
- Ease of conducting business.
- Bank account assistance.
- Residence visa granted for 3 years.
What is the Cost of Starting an Online Business in the UAE
The cost of starting an online business in Dubai depends on factors such as the type of business activities, location, website hosting fees, and the cost of obtaining an online business license. Additional approvals or specific licenses may also affect the total cost.
Estimated Cost:
- Starting Package: From AED 12,000*
- Overall Starting Cost: From AED 15,500*
This estimate includes the cost of a standard online business license and basic operational setup. For more customised solutions, costs may vary.
Required Documents for Start an Online Business in Dubai
Here’s a list of documents required to start an online business:
- Proposed names for your online business (provide at least three trade name options)
- Passport-size photographs of all shareholders
- Copy of the shareholders’ passports
- Copy of the shareholders’ UAE visas
Top 7 Online Business Ideas in Dubai
- Virtual fitness instructor – The pandemic, on a lighter note, has paved the way for entrepreneurs to carry out online workouts, yoga, and meditation sessions.
- Wellness coach – Certified nutritionists and providers of wellness-related services can operate well virtually.
- Mental health counselling – The rapidly changing times, and the restrictions brought about since the onset of COVID-19 have unfortunately created greater demands for counselling services.
- Social media management – Several businesses in almost all sectors have been pushed under the bus with the urgent need for digitisation for survival. Thus, they must utilise the social media platform not only for brand awareness but also advertisements and lead generation.
- Drop-shipping – Simple to carry out, drop-shipping is the new way for those seeking to venture into the world of e-commerce.
- IT solutions – The need for technology-related services is ever-growing, especially in this era.
- Consulting services – Be it educational, financial, or recruitment, most types of consultations can be conducted digitally today.
Other Related Posts:
- How to Start an Online Business in Abu Dhabi
- How to Start an E-commerce Business in Dubai
- How to Get an E-commerce License in Abu Dhabi
- How to Get an E-commerce License in the UAE
Start your Online Business Journey with Shuraa
The UAE is a country filled with possibilities and opportunities. With the digital world ever evolving and with the UAE expanding its horizon with its innovative methods and growth, the possibilities are endless. This is why setting up an online business in the UAE is the ultimate choice.
Obtain your license for online business in Dubai now with Shuraa Business Setup — one of the best business setup companies in the UAE. Shuraa also ensures that the entire process of obtaining your license runs smoothly.
Our expert consultants will guide you through the entire process from registering your online business, regulatory requirements, understanding everything you need to know about the jurisdictions, all the way up to the process of getting approvals from the relevant authorities.
To get started and find out more, contact our expert consultants at +97144081900 or send a WhatsApp message on +971507775554. You can also drop in an email at info@shuraa.com and get your queries answered in no time.
Frequently Asked Questions (FAQs)
1. Is online business legal in UAE?
Yes, online business is legal in the UAE, but it requires compliance with specific regulations and obtaining the necessary licenses and permits from authorities.
2. What license is required to sell online in UAE?
For selling products online in Dubai, you’ll need an E-trader license, tailored to the type of online business activities you’ll conduct.
3. Do I need a business permit for online business?
Yes, all registered businesses, including online shops, require a business permit in Dubai to operate legally.
4. Can I sell online without a license in UAE?
Starting any business in Dubai without a license is against the law, including online businesses. If you want to sell your products online, you must obtain an e-commerce license.
