Dubai has become a leading hub for businesses in the Middle East. With its strategic location, business-friendly regulations, and world-class infrastructure, many companies choose Dubai as their regional headquarters. One essential license that technology and technical consultancy firms need is the Technical services license.
Overview of technical services license
The technical services license allows companies to provide consultation services in various fields like engineering, architecture, computer software and hardware, research and development, and more. Some key benefits of having this license in Dubai are:
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Access to Dubai's market and opportunities in the Middle East, Africa and South Asia
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100% foreign business ownership with no local sponsor required
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Low license and renewal costs compared to other licenses
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Ability to provide both B2B and B2C technical services
Some examples of activities covered by this license include:
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Software, hardware, and IT consulting
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Engineering and architectural design services
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Technical testing and analysis services
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Research and development services
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Energy consultancy services
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Management consultancy for technical projects
Steps to get a technical services license in Dubai
The process of getting a technical services license in Dubai is relatively straightforward. Here are the main steps involved:
Choose a location and office space:-
First, you must determine where to set up your office in Dubai. The main options are business centres, free zones, and mainland areas. Free zones often provide more flexibility and ownership benefits compared to the mainland. Some popular free zones for technical services companies are Dubai Internet City, Dubai Outsource City, and Dubai Knowledge Park.
Rent appropriate office space as per regulatory requirements.
Select the appropriate license type:-
There are three primary license types suitable for technical services:
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Professional license – for individual consultants and freelancers
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Commercial license – for private companies with local or foreign shareholders
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Free zone license – for setting up a company in a free zone
Choose the correct license type based on your business plan and shareholding structure. Free zone companies get benefits like 100% ownership and no local sponsor or agent required.
Get initial approvals:-
Get initial approval from the relevant free zone or government department based on your chosen location. For instance, in Dubai Internet City, you need in-principle approval before applying for the license.
Complete documentation:-
Prepare all the required documents like parent company details, shareholder agreements, business plans, owner/director passport copies, office lease contracts, etc. Many free zones also need a letter of intent detailing the proposed business activities.
Apply for license:-
Submit the license application, documents, and fees to the licensing authority. In Dubai Internet City, the application is submitted online through their self-service portal.
The approval time can range from 2-4 weeks based on the activity proposed. Some technical services may require further approvals from regulating bodies like Trakhees.
Obtain visa and office space:-
Once licensed, the company can apply for employee visas. Office space can also be leased in the relevant free zone or area. Some free zones provide on-demand commercial space, eliminating significant upfront commitments.
Operational considerations:-
Here are some key operational aspects to keep in mind when running a technical services business in Dubai:
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Local partnerships – Consider tying up with a local Emirati partner or company for better market access and deals with government entities in Dubai. A partnership can be explored once established in Dubai.
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Emiratization – Companies with over 100 employees must meet Emiratization targets by having specific percentages of UAE Nationals among their workforce. Extensions can be applied when scaling up the workforce.
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Compliance and visas – Stay continually updated on changing rules and regulations. Renew employee visas and licenses on time to avoid penalties. Have a dedicated PRO for visa processing.
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Banking – Open a corporate bank account to manage revenue flows seamlessly. Choosing the right bank is critical for business efficiency.
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Marketing – Create a website, digital presence and targeted campaigns to reach customers in the UAE and broader GCC region. Participate in relevant regional industry events and expos.
Conclusion:-
Dubai provides an excellent environment for technical services firms looking to tap opportunities in the Middle East and Africa region. With its world-class infrastructure and ease of business, Dubai is the ideal regional base.
A critical step is obtaining your company's proper technical services license based on services offered and shareholding structure. Dubai offers an efficient licensing process through free zones tailored specifically for technical businesses.
By following all regulatory guidelines and building partnerships in Dubai, technical services companies can leverage Dubai as a gateway to access ample growth possibilities in Middle East markets.
You can also consult Quickplus for all your business setup solutions.
FAQs on Technical Services License in Dubai:-
What activities are covered under the technical services license in Dubai?
The technical services license in Dubai allows companies to provide a wide range of technology, IT, engineering, R&D and technical consulting services. Some examples include software development, architectural design, engineering analysis, IT support, technical testing services, energy consulting, and hardware consulting.
What are the fees for getting a technical services license in Dubai?
The exact license fees depend on parameters like location and type of legal structure. However, on average, the fees range from AED 15,000 to 20,000 per year for commercial licenses in Dubai's mainland or free zones. Setup costs are additional.
Where can I get a technical services license in Dubai?
Some popular options for obtaining a technical services license in Dubai are Dubai Internet City, Dubai Outsource Zone, Dubai Knowledge Park, Dubai Multi Commodities Center (DMCC), and Dubai Mainland (Department of Economic Development). The choice depends on specific business activities.
Do I need a local partner for technical services in Dubai?
Free zone companies with technical services licenses do not require local sponsors or agents for launch and operations. However, it helps to have a local partner for some government projects, which can be explored after initial setup.
How long does it take to get technical services approval in Dubai?
The process takes 2-4 weeks from submission of complete documents. Timelines depend on the approving authority, such as DED, free zone, or technical regulating body reviews involved. Activities with high-risk categorization may need further verifications and add 1-2 weeks.
Can I provide both B2B and B2C services with this license?
Yes, the technical services license allows the firm to directly offer services to businesses (B2B) and consumers (B2C). Some free zones may have restrictions on retail trading that can be checked before finalizing the location.
Will my company need to meet Emiratization targets?
Emiratization rules mandate UAE nationals to account for specific percentages of the workforce. This applies to companies with over 100 employees. Relaxations can be obtained on workforce requirements for smaller companies or in the initial years.
Can I apply for a license for technical service while living overseas?
The application process allows owners overseas to apply through authorized signatories in the UAE. Alternatively, specialized agencies can be hired to complete the licensing process without the owners being physically present.
What type of office space do I need to apply for the license?
To begin a license application, documents must show proof of appropriate office premises like rented space or flexi-desk agreement from business centres in the relevant zone. Some free zones offer on-demand commercial space.
Can I sponsor visas with a technical license for employees from overseas?
Yes, technical services firms can directly sponsor work residence visas for employees from abroad under categories like Investor/Partner, Manager, Advisor, Technician, Engineer, etc., based on the company's license activities.
Are foreign technical services firms taxed in Dubai?
VAT at 5% applies to the sale of goods and services. The law states that a nine per cent corporate tax will be levied on companies with a profit of Dh 375,000 and above. Customs duty of 5% applies to imported goods.
Can I open local and foreign currency bank accounts for my company?
Licensed firms can open corporate bank accounts in UAE Dirham (AED) and key foreign currencies like USD, EUR, and GBP with many international banks operating in Dubai. Funds can be conveniently received/sent through bank transfers worldwide.
Is the technical services license renewable every year?
Yes, like all commercial licenses in Dubai, the technical services license requires yearly renewal, which is more straightforward than the initial application. Timely renewal ensures the firm faces no disruptions in operations.
Does my company need additional approval from any authority?
Additional clearance may be needed from bodies like Dubai Municipality, TRAKHEES, the Economic Development Department (DED), etc., for specific technical services, depending on health/safety risks. Industry bodies like IEEE can also accredit firms to demonstrate competency.
Can I get government grants and funding with the technical license?
Yes, licensed technical firms can explore options like the Mohammed Bin Rashid Innovation Fund and R&D grant schemes under Dubai SME, in addition to funding and incentives available in free zones like Dubai Internet City and Dubai Silicon Oasis.
Are there any restrictions on foreign talent recruitment in this field?
Dubai allows hiring expat talent in technical roles under regular visa quotas. Immigration policies aimed at camps and lower-wage workers in sectors like construction do not apply to qualified knowledge workers or technical specialists.
Can my company use an existing technical license from another Emirate?
Dubai offers easy portability for firms registered in another UAE emirate like Abu Dhabi, Sharjah, etc., with a technical license. Additional forms must be submitted to validate existing technical licenses within Dubai's jurisdiction.
Can I sell technical goods along with services under this license?
The technical services license broadly covers intangible consulting services. Trading goods requires additional DED approvals and a separate license. However, some ancillary product sales activity related to services delivered may be allowed.