Business Setup in Sharjah – Guide for Entrepreneurs
Sharjah has emerged as a promising destination for businesses and investors looking to penetrate the Middle East market. It’s the United Arab Emirates’ third-largest emirate. The UAE’s diversified economy, strategic location, and policies favorable to investors make it a lucrative business hotspot. Whether you want to establish a business or expand an existing one, grasping the business setup in Sharjah will ensure that you achieve your objectives.
Understanding Business Jurisdictions in Sharjah
For business setup in Sharjah, there are two primary jurisdictions: the Mainland and Free Zones.
1. Mainland
Businesses in the mainland can operate anywhere within the United Arab Emirates and are registered with the Sharjah Economic Development Department (SEDD). Such businesses are focused on the domestic market and usually need a local sponsor or an agent.
2. Free Zones
Every free zone in Sharjah supports specific industries, and therefore, there are several free zones available.
- Sharjah Publishing City Free Zone (SPC Free Zone): Servicing publishing and media businesses.
- Shams: Servicing creative and media businesses.
- SAIF Zone: Servicing logistics and aviation businesses.
- Hamriyah Free Zone: Servicing industries and manufacturing sectors.
- Sharjah Research, Technology and Innovation Park: This is focused on fostering specific research and development projects.
- Sharjah Free Zones: These offer 100% foreign ownership with no tax and exemption from business registration to set up processes.
Steps to Register a Company – A Business Setup in Sharjah
1. Business Activity
To obtain a license for a business, decide whether it will be commercial, professional, or industrial.
2. Choose Jurisdiction
Based on business goals, target customers, and needs, decide if it will be in the Mainland or the Free Zone.
3. Trade Name Selection
Register a trade name and ensure it hasn’t been picked by anyone and conforms with Sharjah’s naming policies.
4. Primary Approval Application
Send required paperwork to either SEDD or the appropriate Free Zone authority for primary approval.
5. Drafting of Legal Papers
Create a legal Memorandum of Association (MoA) and other deeds and get them notarized according to UAE laws.
6. Business Location
Place of business office spaces or Flexi-desk places, depending on the area’s rules.
7. Business Setup Permit
Meeting all other steps and criteria, obtain a business license. It enables one to begin operations.
8. Visa Issuance
Sponsored and employee passes to the relevant immigration requirements.
Costs of Business Setup in Sharjah
Costs for business setup in Sharjah depend on the jurisdiction, specific activities, and various additional factors. Here is a breakdown of the expenses:
Mainland Setup
Sharjah Free Zone provides packages starting from AED 5,750. It comes with a license fee within the shared office space.
Free Zone Setup
Expenses for setting up businesses on the mainland range from AED 15,000 to AED 30,000. These expenses include all necessary office administrative procedures. The package will include the office rent, needed documentation, and a business license. Other expenses in the area might also include hiring costs such as those incurred through acquiring a worker’s visa, along swith ecuring .
Documents Needed For Business Setup in Sharjah:
The following documents are necessary to establish a business in Sharjah:
- Shareholder and manager passport copies
- Visa copies – if applicable
- Proof of Residence
- Trade Name Reservation
- Initial Approval Certificate
- Memorandum of Association (MoA)
- Lease Agreement for Office Space
Benefits of Starting a Business in Sharjah:
Strategic Location: Proximity to markets in the Middle East, Africa, and Asia.
Cost-Effective: Lower operational costs compared to other emirates.
Business-Friendly Environment: Government policies aid in simplified procedures.
Diverse Economy: Wide-ranging opportunities in sectors like manufacturing, logistics, media, and technology.
Legal Structures for Doing Business in Sharjah:
Determining ownership rights, liability, and flexibility to operate are critical when selecting a legal structure in Sharjah.
Limited Liability Company: Limited liability protection and a diverse range of activities make it ideal for companies with multiple shareholders.
Sole Establishment: Full control with personal responsibility makes it ideal for individual entrepreneurs.
Civil Company: Tailored to professionals like doctors, lawyers, and engineers, allowing them to offer services as a shared entity.
Branch Of A Foreign Company: Permits foreign companies for Business setup in Sharjah without the need to set up a separate legal entity.
Public and Private Joint Stock Companies: These forms allow large-scale operations as they enable raising capital through public or private share issues.
Each structure has its advantages and prerequisites. It disregards the nature, size, and goals of the business one intends to set up.
Sharjah’s Regulatory Compliance Requirements
Fulfilling the local business regulations in Sharjah is fundamental for its smooth running. Some of the key concerns include:
Ultimate Beneficial Ownership (UBO): Information pertaining to ultimate owners or controllers of the company must be disclosed by business.
Economic Substance Regulations (ESR): For some activities, companies must provide evidence of having substantial economic activities in the UAE.
Anti-Money Laundering and Counter-Terrorism Financing (AML-CFT): All businesses are obliged to take proactive steps towards the prevention of financial crimes.
Support Services and Resources for Entrepreneurs in Sharjah
Sharjah has set up many support services to ensure the smooth growth of businesses:
Business Incubators:
Startups are provided with mentorship, networking opportunities, and other resources by these organizations.
Financial Institutions for Business Setup in Sharjah:
A strong banking sector provides businesses with diverse financial products tailored to their needs.
Professional Services:
Legal, accounting, and consulting services assist in compliance with regulations and operational gaps for smooth business continuity.
Government Initiatives for Business Setup in Sharjah:
Sponsorship programs focused on enterprise and innovation put in place make it great for business.
Conclusion
Establishing a business now is greatly simplified with the myriad options available within Sharjah. Strategically lured into establishing there because of its investor friendly policies and supportive landscape. Entrepreneurs and small business owners need only consider local legal structures, compliance, and available resources to effectively carve a competitive edge with a fortified foundation for success. The advanced ecosystem for business setup in Sharjah fosters regional investment and also provides access to global markets. This makes Sharjah perfect for new and even daring business undertakings.
FAQs
1. What is the minimum capital requirement for setting up a business in Sharjah?
In the Free Zone, the capital requirements differ; for example, one of the zones may require an initial deposit of AED 150,000. Companies on the mainland usually do not have minimum capital requirements.
2. Can a foreigner own 100% of a business in Sharjah?
Yes, foreigners can own 100% of a business incorporated in the Free Zone. Companies on the mainland may need a local sponsor or a local service agent.
3. How long does it take to set up a business in Sharjah?
The timeframe differs; businesses in the Free Zone are able to obtain licenses and open accounts in a few days. Those on the mainland tend to take more time because of extra approvals that are required.
4. Do I need a physical office for business setup in Sharjah?
Yes, both the Mainland and Free Zone businesses require rented offices, whether traditional or in the form of a Flexi-desk.
5. Are there tax benefits for business setup in Sharjah?
Yes, Free Zones have tax incentives, including the absence of corporate tax as well as personal income tax.
