Sharjah is the third-largest emirate in the United Arab Emirates (UAE) and is rapidly emerging as a hub for entrepreneurs and investors. Sharjah is very well known for its cultural heritage, stunning landscapes, and business-friendly environment. Business setup in Sharjah offers numerous benefits, including tax advantages, access to a skilled workforce, and proximity to key markets in the Middle East and beyond.
Understanding the process and requirements for business setup in Sharjah is crucial for any aspiring entrepreneur. From selecting the right type of license to understanding local regulations and procedures, there are several steps involved in setting up a business in Sharjah. So, let’s take a close look at how to set up a business in Sharjah, the process, type of license, cost and more.
Why Choose Business Setup in Sharjah, UAE?
There are several advantages to setting up a business in Sharjah, UAE, both in the Sharjah mainland and the emirate’s free zones. Here are some of the key benefits:
1. Strategic Location
Sharjah is strategically located between Europe, Asia, and Africa which makes it a prime location for businesses looking to access markets in these regions.
2. Business-Friendly Environment
Sharjah has a reputation for being entrepreneur-friendly. The government implements policies that encourage foreign investment and support business growth.
3. Tax Advantages
Depending on the location (Mainland vs. Free Zone) there can be exemptions on corporate and personal income tax, import and export duties, and minimal ongoing operational costs.
4. 100% Foreign Ownership
In the Free Zones and for many business activities in the Mainland, foreign investors can have complete ownership of their businesses.
5. Skilled Workforce
The UAE, including Sharjah, has a highly skilled and multicultural workforce. The government has invested in education and training programs to ensure the availability of skilled professionals across various industries.
6. Variety of Business Structures
Businesses have the flexibility to choose from various legal structures, including LLCs, sole proprietorships, and partnerships which allows them to pick the one that best suits their needs.
Types of Business License Available in Sharjah
Sharjah offers several business licenses to cater to different business activities. Here are the main types:
1. Commercial License
This is the most common type of license, required for businesses involved in trading activities such as import, export, retail, and wholesale.
2. Industrial License
This license is required for businesses involved in manufacturing or industrial activities, such as the production and packaging of goods.
3. Professional License
If your business provides professional services like consulting, accounting, or legal services, you will need a professional license.
4. Tourism License
Businesses operating in the tourism sector, such as hotels, travel agencies, and tour operators, require a tourism license.
The specific requirements and activities covered under each license can vary, so it’s advisable to consult with the Sharjah Department of Economic Development (DED) or a business setup specialist at Shuraa for detailed guidance.
Types of Business Setup in Sharjah: Mainland & Freezone
Sharjah, like other emirates in the UAE, provides two main avenues for business establishment: the mainland and the free zones. Each offers distinct business structures with its own set of advantages and requirements.
1. Mainland Company
- Limited Liability Company (LLC) is the most popular choice which allows multiple shareholders (up to 100) with limited liability proportional to their investment.
- Requires a local Emirati sponsor who holds a majority share (usually 51%) unless operating in specific government-approved sectors that allow 100% foreign ownership.
- Ideal for businesses that want to operate within the UAE market and participate in government tenders.
- Grants access to the entire UAE market and allows trading locally.
- Generally more regulations compared to free zones.
2. Freezone
- Sharjah boasts multiple free zones, each specializing in specific industries.
- Similar to an LLC, a Free Zone Company (FZC) allows full foreign ownership (100%), ideal for complete control by foreign investors.
- The business operates within a designated free zone area in Sharjah.
- Primarily restricted to trading outside the UAE (though some free zones allow limited local sales with additional licenses).
- Less stringent regulations compared to the mainland.
Documents Required For Company Formation in Sharjah
The documents required for business setup in Sharjah will vary depending on whether you choose the mainland or a free zone. However, here is the general requirements:
- Passport copies of all company shareholders and directors.
- Passport-size photographs
- Business plan
- Application form
- Trade name reservation certificate
- Local Sponsor Agreement (if applicable)
- Memorandum of Association (MOA)
- No Objection Certificate (NOC) (if applicable)
- Bank reference letter
How to Set Up a Business in Sharjah?
Company formation in Sharjah involves several steps, including:
1. Define Your Business Activity
Business Activity: Clearly define the activities your business will undertake. Research and identify the appropriate business license category.
2. Choose your Legal Structure
Decide on the structure (LLC, sole proprietorship, etc.) that best suits your ownership and liability needs. For the mainland, you may need to consider the local sponsor requirement for certain categories.
3. Trade Name
Choose a unique and available trade name. You can check name availability through the Department of Economic Development (DED).
4. Business Registration
For the mainland, register your trade name and company structure with the DED. This might involve submitting documents like a Memorandum of Association (MOA) for an LLC.
For Free Zone, register your business with the chosen free zone authority. Each free zone may have specific requirements for registration.
5. Obtain Licenses and Permits
Apply for the relevant business license based on your activity (commercial, industrial, professional etc.). Depending on your business activity, you might need additional permits from specific government entities.
6. Open a Corporate Bank Account
Open a corporate bank account in a local bank in Sharjah. Provide the bank with the necessary documents, including the company registration certificate, establishment card, and passport copies of shareholders.
7. Visa Processing
Apply for residency visas for company shareholders, employees, and dependents through the General Directorate of Residency and Foreigners Affairs (GDRFA) in Sharjah. Visa requirements may vary depending on the business structure and nationality of individuals.
Consult with a business setup specialist in Sharjah at Shuraa Business Setup. They can guide you through the process, handle paperwork, and ensure compliance with regulations.
What is the Cost of Business Setup in Sharjah?
The license cost for business setup in Sharjah typically ranges from Range from AED 15,000 to AED 30,000. However, the overall cost can vary depending on several factors, including:
- Business structure: Mainland or Freezone
- Business activity
- Company size
- Office location
- Government fees
- Bank fees
- Visa fees
There’s a minimum capital requirement of AED 150,000 for company registration in Sharjah. This is not a mandatory deposit but serves as a financial indicator. Consult with a business setup specialist in Sharjah. They can assess your specific needs and provide a tailored cost estimate.
Simplify Your Sharjah Business Setup with Shuraa
Ready to make your business dreams come true in Sharjah? It’s a happening place with loads of opportunities just waiting for entrepreneurs like you! Sharjah isn’t just about culture and history, it’s a thriving business destination where your idea can really take off.
And the best part? At Shuraa Business Setup, we’re here to make it super easy for you. We’ll guide you through all the boring paperwork stuff, help you get the right licenses, and even find the perfect office space for your new venture.
So why wait? Let’s team up and turn your business dreams into reality in the exciting world of Sharjah. Get a Free consultation today!