Dubai’s booming construction sector has positioned the city as one of the top global destinations for infrastructure development, attracting billions in foreign investment each year. Dubai, a booming economic center with one of the fastest-growing urban environments in the world, provides special benefits for construction firms looking to profit from projects ranging from luxury resorts and smart city infrastructure to high-rise skyscrapers.
Dubai is still a top option for construction companies looking to expand and gain international recognition since it offers 100% foreign ownership in free zones and a pro-business atmosphere bolstered by advantageous tax laws.
For entrepreneurs and established companies looking to register a construction company in Dubai, understanding the setup process and the various licensing requirements can open the door to lucrative opportunities in this competitive market. This guide will cover everything you need to know to establish and grow a successful construction business in Dubai’s dynamic economy.
Why Start a Construction Company in Dubai?
Dubai offers unparalleled growth opportunities, especially for construction and infrastructure companies. With government support for major projects like Expo 2020 legacy projects, smart city initiatives, and ongoing infrastructure expansion, Dubai remains a prime location for construction businesses.
Here are the main benefits:
- Strategic Location: Dubai is an entryway between the East and the West, providing easy access to the MENA region.
- Tax Benefits: Dubai offers various tax advantages, including 100% foreign ownership in free zones, zero corporate and personal income taxes, and an extensive network of Double Taxation Avoidance Agreements (DTAAs).
- Advanced Infrastructure: The city has top-tier infrastructure, making it a convenient base for companies targeting international expansion.
Procedure To Setup A Construction Company In Dubai
There is a set pattern to everything, and the same applies to starting a new firm. To register a construction company in Dubai, you need to follow certain steps.
The steps are as follows:
Step 1: Select a name for your business
You must first decide on a name for the newly formed organization. Dubai requires that company names abide by specific rules. You are not permitted to use any vulgar or derogatory language. Avoid acronyms if you decide to name your business after yourself.
Additionally, make sure that no other organizations or enterprises already in existence have names that are identical to your chosen one. Given that your name must be distinct, it is a good idea to present a few alternatives in case your first choice is not accessible. Once you’ve made a decision, we’ll register your business name on your account.
Step2: Choose your business structure
The next step for registering a construction company in Dubai involves choosing a business structure that is suitable for you.
Step 3: Submit a license application
In the next stage, you can apply for your business license. When opening a business on the Mainland, this application should be forwarded to the Department of Economic Development. You must apply to the appropriate managing authority if you want to launch your business in a free zone.
Along with the application, you will also be required to submit supporting documentation, such as a valid passport copy.
Step 4: Obtain permits and other necessary approvals
Applying for your building permit, or your G+1 permit if you’re operating from a free zone, is best done right away. You ought to submit applications for any other approvals you might need for registering a construction company in Dubai.
Step 5: Apply for a visa
To live and work in Dubai, United Arab Emirates, you will require a residency visa. The health and fitness assessment, which involves a blood test and a chest X-ray, is a crucial component of this procedure.
You can sponsor the visas of your dependents, including your spouse, children, parents, and household employees if you have a visa for the United Arab Emirates.
Our professionals at OnDemand International can assist you in obtaining the visa and gathering the necessary paperwork for your visa application.
Types of Business Structures for Construction Companies
In Dubai, the two primary options for setting up a construction company are the Mainland and the Free Zone.
Every choice offers a unique set of advantages:
Mainland Company
Company formation in Dubai mainland allows you to operate anywhere in the United Arab Emirates and engage with government contracts. However, a local partner may be required.
Free Zone Company
A free zone company formation in Dubai offers 100% foreign ownership, fewer regulations, and tax exemptions but limited to operating within the free zone area or exporting services.
Choosing the right structure depends on your business goals, especially if you want to conduct projects throughout Dubai or engage in public sector contracts.
Licenses Needed to Start A Construction Company In Dubai
UAE Construction Permit
Before registering a construction company in Dubai, you must first secure a license to begin operations.
The following are the several types of construction licenses available in Dubai:
Obliterating and Destruction License
451001: The activity code
License Category: Building and Constructing Works
With this license, you will be able to destroy large structures that are in disrepair and on the verge of collapsing or to substitute them using various methods such as forklifts for tall structures, manual labor for medium-rise buildings, bulldozers, and infrastructure detonation using explosive materials.
Building Contractor’s License
452001: The activity code
License category: Business
Procurement and construction work is a group of activities.
Under this license, you will be employed in the development of a variety of structures, including residential, farms, public, airports, rural structures, hospitals, schools, commercial, and industrial.
Permit for Maintenance Works
454007: The activity code.
License Category: Commercial
Work in the Activity Group includes construction, maintenance, monitoring, and cleaning.
This license will enable you to restore and repair roofs, floors, walls, columns, and other structures inside structures that do not have any technology or extensions accessible.
Steel Construction and Contracting License
452008: The activity code
License Category: Commercial
The activity group manages the contracting and Building assignment.
To describe the activity, using this license, you’ll be able to take forward all your processes concerning steel construction and you’ll also be able to install steel infrastructures in various locations like bridges, warehouses, factories, sheds, structures, and tunnels.
Read More: General Trade License in Dubai
Necessary Permits and Authorizations Required for Dubai Construction Company
Permission for infrastructure projects, which covers work done before any bases are laid. The contractor must submit detailed plans of the planned project to the relevant rule to get a permit to build.
So, let’s dive into details and learn more about the mandatory permits one needs to have to register a construction company in Dubai.
You would need:
- An authorized environmental license from a relevant body.
- An official allowance from the Roads and Transport Authority to use the external & internal roads for transport needs.
- Approval from relevant bodies to get rid of dangerous waste and residual building material.
- Another permit that is required is from the UAE government bodies, for utilities. The utilities include electricity, water, and sewage. So, you will need permission from the Dubai Electricity and Water Authority. To gain a permit for telecommunications you will need a confirmation from Etisalat.
- The next permit you would need is an NOC for Dubai Airports Corporation from the Dubai Civil Defence.
- Last but not least, you will also need a Building Completion Certificate that helps you gain a permit to occupy the building.
Conclusion
The rising economy, quick infrastructure growth, and ambitious construction projects in Dubai create an ideal atmosphere for the growth of the construction industry. Since Dubai is one of the major building industries in the United Arab Emirates, starting a construction company there could prove to be a rewarding business venture for you.
By obtaining the necessary licenses and approvals from relevant authorities, obtaining a visa, and adhering to the legal requirements, you can establish a construction company in Dubai.
If you wish to set up your construction company in Dubai, you can contact our experts at OnDemand International. You will be assisted in registering your construction company and securing the necessary approvals by our experts who will analyze a number of factors in order to help you build a successful business.
