Entrepreneurs choose UAE to start their business overseas as they’ve researched and are amazed by the accelerated development of the region. UAE is always in the spotlight in the print and electronic media for its groundbreaking developments, reforming foreign investment policies, new startups, and corporate framework.
Despite all the overlooked rumors about the slow economic growth of the region that crop up after few years, UAE is steadily surpassing the expectations of the current and foreseen investors and entrepreneurs with its next-level development, evolution, and growth.
However, here are 5 challenges that newbie encounter while setting up their business in UAE:
- Company Ownership
Forming a Limited Liability Company (LLC) or an onshore company in UAE restrains to have a local partnership with a UAE National. Additionally, norms also describe that investors can only have an ownership of 49% whereas 51% of stakes are upheld by the local National.
- The obligation of a Local Business Partner
As mentioned above, the necessity of having a local national partner is probably the biggest obstacle that comes across the way of young entrepreneurs. As a matter of fact, there are only three ways of forming a company in UAE: Acquiring Professional Service License, Setting up Business in UAE Free Zone, or forming an LLC.
- Possible VAT Application
To date, we all like the tax-free aspects of UAE, which offers excellent pro-business benefits to the corporate world, and apparently, this is the most significant reason that turned UAE into the supreme destination for new entrepreneurs to kick-start their business without any tax burdens. But possibly this is not the case anymore with the announcement of VAT in the year 2018.
- Revenue Management
Revenue management is important in the UAE. And not only in UAE but in business, because along with the plethora of opportunities comes along many risk factors too. According to the Association of Chartered Certified Accountants of Dubai, approx. 82% of the new enterprises break due to poor cash flow and funds management. While setting up your business in UAE, you can avail loans from several financial institutions and banks, but ensure that your primary capital obligations and business setup are efficiently managed and implemented.
- Cultural & Communication Difficulties
Lastly, the biggest problem is concerning the culture and communication that is needed to be addressed respecting Islamic values. Business communication is required to be separate for men and women and the formal directness and approach are also limited.
How Can Business Setup Consultant Help?
You First – The Business Setup Company is a foremost consultancy firm in UAE with prominence for assisting various clients in setting up their businesses across the region. If you are also scared by any of the above challenges and desire to start up your business in UAE, then talk to our experts who are just a call away for service.
Consult now to our business setup consultant expert at www.youfirstme.com.