A Sole Proprietorship in Dubai is a legal entity owned and operated by a single individual, known as the sole proprietor. The sole proprietor is in complete control of the company’s operations and profits and bears unlimited liability; that is, he/she is fully liable for the company’s debts or and obligations.

A Sole Proprietorship Company in Dubai can be formed only by a UAE national or a national of the Gulf Cooperation Council (GCC). For a non-UAE national, establishing a sole proprietor company would require him/her to have a residence permit and a local sponsor. They can be a Dubai national or company. In case the sole proprietor is to carry out a professional or commercial activity, he/she must obtain the appropriate license.

Advantages of a Sole Proprietorship Business in Dubai

• Foreign professionals can retain 100% foreign ownership in the business.
• The company can legally practice professional services anywhere in the UAE, including Free Zones
• No restrictions on the location where the company can rent/buy office space
• The government has wholly waived any paid-up capital requirements

Conditions to Set up a Sole Proprietorship in Dubai

• The sole proprietor is engaged in consultancy activities must have obtained an education qualification for the same activity that he/she has selected.
• There is a limitation to the number of managers that can be appointed on a professional license.
• The capital of the business is not a constraint for a sole proprietorship.
• The business name must be related to the commercial activity of the company.
• A sole proprietorship can have more than one branch. Each may undertake one or all the activities included in the main business license.
• The owner/s can also change its legal form according to DED procedures.
• A single establishment may need the owner or a manager to appear for exams with an American University in Dubai in support of practicing certain economic activities. These exams are required at the time of setup and renewal of the license.

How to Start a Sole Proprietorship in Dubai?

The business setup process for all the legal forms is like a change in the documents only.

The sole proprietorship registration steps include –

1. Decide on a trading name for your establishment in Dubai
2. Get an initial approval from the Dubai Department of Economic Development (DED)
3. Fill the application form for business license and submit it to the registrar with the documents
4. Pay fees and obtain the license
5. Get an office space

The following documents must be filed with the Trade Register to set up a sole proprietor company in Dubai:

• Business application form
• Licensing application form
• Name, residence permit, and passport copy of the sole proprietor
• Details of the local sponsor, in case the sole proprietor is a foreign citizen
• No-objection letter by the sponsor, if applicable
• Proof of registered address of the company
• Details of the local sponsor, in case the sole proprietor is a foreign citizen
• No-objection letter by the sponsor, if applicable
• Proof of registered address of the company

All the documents must be notarized and attested from the relevant UAE consulate. All documents must also be translated into Arabic by an official translator before they can be presented to the UAE’s authorities.

Many professionals settled in the UAE like engineers, doctors, management consultants, IT graduates prefer setting up a sole proprietorship in Dubai.

An individual of any nationality can go about setting up a sole proprietorship also known as a professional license. However, if the individual is a national of any country other than the UAE or GCC, they need a Local Service Agent (LSA) in support of the license. A service agent’s responsibilities are to render necessary services to the company. Such as support with the Department of Immigration, Department of Economic Development, and the Ministry of Labour. They hold no financial liabilities or obligations related to the company inside and outside the Emirate.