Have you ever worked in the UAE? If not, this is the best time to know about the amazing region and its developments. UAE island that welcomes lots of business ownerships and a place which is the best for electronic and print media, corporate framework, reforming investment system from abroad etc. There is much gossip regarding the gradual economic growth of the country, but the UAE meets all the present expectations of entrepreneurs with breathtaking growth, evolution and development.
If you are a budding businessman, then you may find many challenges to Setup new Business in UAE. Let’s dig more into the ocean of business set-up challenges you usually find difficult to fix.
Challenges to setup business in UAE
If you want to set up a business, say, a Limited Liability Company or an onshore organization in the UAE, then, it is mandatory to have a partner who is locally from UAE. Also, there was a rule that the owner will get only 49% of the company share whereas the local partner will; have 51% of the share. But this rule has changed recently and now the companies with foreign investors can have 100% ownership under certain conditions. If you set up a business in the free zone, you can have 100% ownership but any region outside the free zone must have a local partner.
Need of a Local Partner for the business
One of the difficult steps in setting up a business in the UAE is to find a local partner from the UAE. Three ways of company formatiocomprisees Free Zone business setup in UAE, obtaining a professional license, forming an LLC. But all three days require a local person to be a partner in any way. To be clearer, if you want to form an LLC or want to obtain a professional service license, then the company must need a local body to get 100% foreign ownership. It is similar in the case to free zones as it is not possible to deal with the local market in the UAE without a partnership with the local person in the UAE.
Do you know why people are getting attracted to Dubai to start their business? One of the main reasons is the tax-free opportunities in the UAE. Everyone enjoys tax-free zones that provide business advantages to the corporate world. But there are some amendments in the present situation with the declaration of the VAT application form that came into the role in January 2018. This new change has made the investors in confusion regarding their compliance terms, auditing, bookkeeping etc that lead to scepticism in the market.
Managing the revenue
For every business, revenue management is one of the most important and the most risk factors. If there is no proper revenue flow, it can lead to the failure of ventures. So, while you are setting up a business especially in the UAE, revenue and funds flow must be checked properly to avoid these failures. Once your initial revenue necessities and the business setup are managed effectively, you will get loans from financial banks and agencies.
Difficulty to communicate
Being an Islamic country, communication difficulties and cultural issues is the factor to be checked. Business communication is an inevitable thing and if it’s not done properly, there are chances to get fewer clients that negatively affect the business. But Emirati people are jovial and welcoming, if your conduct is good then your business will flourish in the land of UAE for sure.
As a leading Business setup consultants in Dubai, Centriz helps various clients to set up their businesses in and around the UAE. If you are facing any challenges as mentioned above while setting up the business, feel free to contact us to make your dream come true.