When it comes to the most popular location for business incorporation in the UAE, Dubai takes the cake! Although Dubai is the most preferred location for business setup amongst entrepreneurs, Sharjah also is no less prominent business setup location in the UAE. No matter what city you choose for business formation in the UAE, you have to jump through hoops to accomplish the task regardless of the type, size or location of your company. However, with the help of an experienced business setup consultant, things become a lot earlier. Whether you DIY or hire one of the best business formation companies in Sharjah, UAE, knowing the process is always helpful, making your entrepreneurial journey smooth and free of any bumps. Ahead, you will learn about:
- Is Sharjah a right pick for business setup?
- The benefits of business setup in Sharjah
- Types of licences available in Sharjah
- The cost to set up a business in Sharjah
- Sharjah LLC company formation process
- Sharjah free zone company formation process
- Sharjah company registration process
Why Sharjah for Business Setup?
If Sharjah is the place your heart is set on for your first or next company setup, we won’t ask why! Monikered after ‘Rising Sun’, Sharjah is a more than 6,000 years old gem in the crown of the United Arab Emirates! Symbol of culture, intellect and architectural revolution in the UAE, the city is the cultural and literature hub and is regarded as the cultural capital of the UAE. Sharjah is known for its Arabic and Islamic architecture as well as its libraries, Islamic museums, and cultural centres. Home to several important free zones such as Al Hamriyah Free Zone and Sharjah Airport International Free Zone which help in improving the movement of investment in the emirate, Sharjah boasts a steady, integrated and attractive investment infrastructure. The presence of the Industrial Areas in abundance creates the appropriate investment atmosphere in Sharjah and provides business opportunities in almost every sector. Not to mention, Al Sajaa Industrial Area, which is equipped with a modern and sophisticated road network and means of transportation. With Sharjah International Airport, the emirate makes trading operations and movement of goods inside and outside the emirate an easy breeze. Home to about 1.5 million people, Sharjah is the third-largest city in the United Arab Emirates, after Dubai and Abu Dhabi. With numerous economic prospects attracting local as well as foreign investments, the emirate alone contributes 7.4% of the GDP of the United Arab Emirates. And the strategic location of the emirate overlooking the ports of the Arabian Gulf and the Gulf of Oman is the cherry on the cake. But what makes it even more special is the mix of the modern and urban with tradition and culture. UAE’s only emirate that has common borders with the other six, Sharjah is an excellent choice for living and doing business in the UAE.
Benefits of Business Setup in Sharjah
Sharjah is one of the fastest-growing economies in the UAE and therefore, businesses flourish easily. The world is your oyster when it comes to setting up a company in Sharjah, one of the most thriving emirates in the UAE, as the city offers tremendous business and investment opportunities and possibilities for local as well as foreign investors. Plus, Sharjah is a tax haven. Companies are not levied any type of taxes. You may choose amongst different types of companies in Sharjah from LLC, Joint-stock corporations, branch offices and subsidiaries to sole proprietorships. Several advantages of opening a business setup in Sharjah include:
- Affordable rental office spaces, even at prime locations
- Low cost of living
- Less competitive environment/less crowded marketplace
- Low cost of running a business
- No restriction of any currency unlike other emirates
- No mandatory requirement for an audit
- There is virtually no capital requirement of any kind
- Freedom to select the business activity
- Access to unlimited visas for employees
- Availability of 19 Industrial Areas with a 48% contribution to the UAE’s gross industrial output
- Huge presence of international banks and modern communication system
- 100% exemption for import, export, and commercial levies
- 100% repatriation of profits and capital for foreign companies with complete ownership of business being allowed
- Warehousing facility for businesses to store goods freely up to 2 months
- Remunerative governmental incentives for investors of every industry
- Availability of multiple entry visa options for entrepreneurs
- Elaborate infrastructure activities
Types of Trade Licences Available in Sharjah
One has to obtain a trade licence from the relevant authority to conduct the desired business activities in the UAE, regardless of the emirate or location of the company. The licence must be in line with the nature of the business. Sharjah Economic Development Department (SEDD) oversees the licence matters for Sharjah businesses whether it is regarding licence issuance, or licence renewal. Just like other emirates in the UAE, Sharjah also offers three types of trade licences namely:
- Commercial Licence: Issued to conduct trading activities of any sort
- Professional Licence: Granted to artisans, services and craftsmen
- Industrial Licence: Required for manufacturing or industrial activity
For specific business activities, the authorities issue special licences such as Entrepreneurial Business Licence and the Business Operation Permit to name some.
Requirements for Sharjah Trade Licence
In order to acquire a trade licence to be able to conduct your business in Sharjah legally one has to meet the following criteria:
- Determine the category your business activity falls under i.e., industrial, commercial or professional
- Specify and assign a maximum of ’10 per licence’ business activities
- Choose a trading name for your business as per the UAE naming norms; Sharjah has a regulation that permits only Arabic names for corporations. So, the naming pool in Sharjah is limited to words within the Arabic language
- Submit the application to SEDD for initial approval
- Once approved, register the trade name (if it hasn’t been registered earlier)
- Lease/rent a commercial place to run your business and seek approval from the Sharjah Municipality
- Prepare the required documents, including a memorandum of association and approval from all relevant governmental authorities
- Make a final submission to the Department to receive a licence to begin the business operations
- Pay the fee and duly collect your trade licence
Businesses should also try and register their business trademark in the UAE during the licence process. Most companies, after making a mark in Sharjah, plan to expand their business in Dubai and other emirates as well. In such cases, you might need to attain different business licences in Dubai, including the E-trader licence in Dubai. The spadework involved in getting a business licence can exhaust you. Pass the buck to Adam Global Dubai, one of the leading business set-up services providers in Sharjah.
Sharjah Business Setup Costs & Trade Licence Fee
There is no straightforward answer if you want to know the exact cost of business setup in Sharjah. There are multiple factors that decide the total cost of forming a company in the UAE. For instance, to business setup in SHAMS which is one of the most cost-effective free zones in Sharjah you might need to invest at least AED 25000 and to open a business in Sharjah Airport International Free Zone you might need to cough up not less than AED 35000. It is always beneficial to open a company in a free zone because not only get to enjoy tax benefits and other incentives but also it is possible to start a company with a limited budget. Similarly, the cost of Sharjah trade licence also depends on myriad factors including company ownership model, type of licence, rental contract value and other factors. Checking the official website of Sharjah Economic Development Department is the way to figure out the exact fee you have to fork out for your trade licence or you may simply get in touch with one of the best business advisors in Sharjah or Dubai, UAE to get to know a ballpark figure.
Sharjah Jurisdictions for Setting up a Business
The first and foremost step towards setting up a business in Sharjah is picking the right jurisdiction that checks all the boxes as per the exact nature of the commercial activities one is planning to conduct.
Business Setup in Sharjah Mainland
Registering your business in Sharjah mainland gives you the flexibility of trading inside or outside of the UAE. The jurisdiction doesn’t put any limitations on employment visas, and Sharjah mainland companies also do not have to pay any corporate taxes or personal taxes. Plus, foreign investors or companies in the Sharjah mainland area can enjoy 100 percent ownership which has been allowed since June 2021 after Sharjah Economic Development Department (SEDD) declared the full foreign ownership policy for the onshore or mainland companies to encourage foreign direct investment. The policy doesn’t mandate the requirement of specific capital for foreign investors plus, they don’t have to pay any additional fees while permitting branches of foreign companies to operate their business in the emirate without the need for an agent of a foreign company.
Business setup in Sharjah Free Zone
Establishing a company in Sharjah free zones has its own set of benefits. From permitting the expat businessperson 100% ownership, providing world-class infrastructure and permitting free trade within the same jurisdictions to exempting from any sort of foreign duties and taxes including recently introduced CIT and VAT under the tax holiday scheme. Businesses registered in Sharjah free zones have a leg up on infrastructure as the strategic location of the region gives them easy access to warehouses, cargo airports, and seaports, providing a feasible arena for all kinds of industries. Sharjah boasts various free trade zones, amongst them Sharjah Airport International Free zone, SHAMS and Hamairah Free Trade Zone are the popular ones.
Sharjah Free Zone of the UAE is a hotspot for business entrepreneurs looking to expand their business globally. With myriad tax benefits, easy access to ports and airways, cheap labour and resources, this free zone is becoming a common choice for business houses. You may also strike gold with Sharjah Media City (SHAMS) business setup as the free zone brings ample benefits including NIL corporate tax for 50 years, NIL important & export duties, 100% free transfer of funds, 100% repatriation of profits, 100% foreign ownership, low-cost workforce & quick recruitment procedure, documentation in 2 days, cost-effective licencing, companies limited in liability, no need of NOC or being physically present in the UAE for business incorporation.
Sharjah Company Registration Process
Be it Sharjah or any other emirate of the UAE, the relevant company setup procedures including required documentation depend on the type of business one wants to start.
Sharjah LLC/Mainland/Onshore Company
Below are the steps involved in securing a licence for a Limited Liability Company in Sharjah:
- Submit the required documents after completing obligations such as deciding trade names, performing inspection and other legal transactions
- A SEDD employee performs a check on the application and endorses if every document is correct and in place. If not, you will be asked to make amendments in the existing application or add things as per requirement
- Make payment for auditing and permission
- Finally, you will be granted the licence as well as registration certificates
Paperwork for Business Setup in Sharjah
The company formation documents are more or less the same regardless of the legal structure of the entity. Below are the lists of required documents as per the type of company one wants to open:
Sharjah Mainland Company Setup
- Duly filled trade licence form
- Brand certificate
- Single copies of Passport and National ID
- Certified no-objection letter from the applicant along with a photocopy of residence visa, passport or identity card
- Official technical assessment report
- Official approval as per the requirement of specific business
- A Notary Public certified partnership contract
- Official/external approvals (if any)
- Approval from the Ministry of Economy
- Approval related to legal affairs
- Lease contract certified
- Photocopy of property certificate or map image
Partnership Company Setup in Sharjah Mainland
- Trade licence form
- Brand certificate
- Single copies of passport, civil register applicant, National ID, visa or resident ID card of the expat
- Official technical assessment report
- Official approval as per the requirement of specific business
- A Notary Public certified partnership contract
- Official approvals (if applicable)
- Approval from the Ministry of Economy
- Approval related to legal affairs
- Lease contract certified.
- Photocopy of property certificate or map image
Formation of a Foreign Company Branch in Sharjah
Check out below the steps to follow for a foreign company branch setup in Sharjah:
- Apply for licence via the Department of Economic Development
- Approval from Company’s BOD (Board of Directors) or meeting minutes to open a new branch (including legal translation and statement issued by a company representative)
- Submit authenticated documents from the United Arab Emirates Ministry of Foreign Affairs and UAE Embassy in a foreign country, with translation if required
- Power of attorney issued in the name of the foreign company’s representative to go ahead with the project
- Submit the complete application along with required paperwork to head of trade name section for branch registration
- Verify with the Trade Name Section
- Contact the Ministry of Economy for approval to open the branch
Paperwork For Foreign Company Branch Setup in Sharjah
- Duly filled licence application form
- Certified registration certificate and commercial licence from the parent company
- Translated and certified parent company’s Memorandum of Association (MOA) along with its amendments (if applicable)
- A certified photocopy of parent company’s Statute along with legal translation (Only for public & private shareholder companies)
- Resolution from parent Company’s board of directors or minutes of the meeting authorizing opening of the branch
- Certified Photocopy of agency signed contract between the local agent and foreign company
Formation of a Local Company Branch in Sharjah
Here’re the steps to obtain a licence for opening a local company branch:
- Complete the application form structured by the Department of Economic Development (DED)
- Complete the said requirements as per the form and visit the head of trade name section for approval
- Take update from the trade name section for name adoption for the business
Paperwork for Local Company Branch Setup
- Certified copy of registration certificate and commercial licence of the parent company
- An authenticated photocopy of the parent company’s Memorandum of Association and any amendments
- Parent company’s Statute authenticated photocopy (only for private and public shareholder companies)
- Company’s board of director’s minutes of the meetings giving their consent for opening the branch
Professional Company Setup Assistance in Sharjah or anywhere in the UAE
Our qualified Dubai business setup advisors can help you in striking out your business venture, whether you are expanding your business in Dubai or Abu Dhabi, the capital of the UAE. Our business consultants in Sharjah will not only help you take the initial steps of business formation in Sharjah but also with the next steps including accounting & bookkeeping services, finance management, tax planning & compliance, registration of business for VAT in the UAE and so on. Our qualified VAT specialists can help you in VAT registration, VAT returns filing and VAT training you and your employees looking after VAT operations. Corporate tax is also approaching the UAE. Feel free to get in touch with our corporate tax specialists to get tax prepared for a smooth transition into the next financial year 2023-2024.
