A sole proprietorship or sole establishment is an establishment or business completely owned by a single person. Under the name of a single owner, the trade license for such an entity establishes. This single owner is responsible for all the financial transactions and the gains that take place in the establishment. He is also responsible for its liabilities and losses.
This also means that a corporate body is not eligible to build a Sole Establishment in UAE. Since it cannot have a single owner for the company. When building a Limited Liability Company 51% of shares are for the local agent who acts as the owner of the company in the UAE. The remaining shares remain with the foreign owner. While in the sole establishment, the owner of the establishment providing his professional services exercise 100% ownership over his company. This provides the sole proprietor with complete control over the business and its profits. Also imposing on him the liability for the debts and losses.
To set up a Sole Proprietorship in Dubai, one has to get a Professional license from the DED (Department of Economic Development) even if they do not engage in any commercial activity. But for practicing professional services that do not involve commercial activity. One can get exempted from CCL (Commercial Companies Law) in Dubai.
Procedure to setup Sole Establishment in Dubai
DED or Department of Economic Development in Dubai is the body that registers and issues trade licenses to various companies in UAE and that includes a sole proprietorship company too. The procedure to build your sole establishment in Dubai is simple and quick. However, the time taken to complete the formalities may also depend on the type of your business activities and other requirements.
Steps involve in sole proprietorship company formation in Dubai
The first step is to get approval from the prominent licensing authority in Dubai, which is DED. This approval is the indirect confirmation from the government of their agreement or non-objection for the type of business activity you are going to provide. You also have to give three trade names for approval, out of which the DED has to approve at least one of the names.
Get physical office
It is crucial to have a physical office space before you proceed to register your office. Once you have all the approval from the government and non-government agencies, the next step is locating the physical address of your office. You are also required to submit the tenancy contract of the space you get on a rental basis for your business operations.
Payment for the final step
In order to get a trade license, and for that, you have to make the necessary payment at last. You can collect your trade license within a few days of making the payment.
Business Link UAE assures you to get your sole proprietorship company set up to comply with your specific requirements. We offer different business setup packages to suit the unique business activity for which you are setting the establishment.