Company incorporated. Tick. What do you need to do now? Here’s a list of things you shouldn’t overlook as you press ahead with growing your business:
After your company has been incorporated and registered (i.e. the company has a commercial licence), it will need an Establishment Card. It is needed for all visa- and immigration-related government services and your company will not be able to employ or obtain any residency visas without one. An application is submitted to the Ministry of Interior (for onshore UAE companies) or through the relevant free zone authority (for free zone companies). Note that in ADGM, the Corporate Relations team will retain the Establishment Card but can issue a letter confirming its existence if you need written evidence. Request this letter as soon as possible and keep it in your document wallet (see below).
In the some of the free zones in the UAE, your company may need an additional registration for visa services (e.g. in ADGM, a company must have a registered Fawri Account).
Create your document wallet
Carry your company stamp and/or Establishment Card (or ADGM confirmation letter) with you. Everywhere. And, if you’re in the UAE, your passport, visa and identity card (commonly referred to as the “Emirates ID”).
Look to the future now: keep documents organised from the start to avoid delays later when potential investors need to review your legal documentation. Keep copies of your company’s articles of association, board minutes, business plan and budgets, employment offer letters and agreements, registrations and licences, company and key personnel identity documents (i.e. Establishment Card/ADGM confirmation letter, passports, visas and Emirates ID). In the UAE, hard copies are likely to be needed frequently but also consider storing electronic copies in a secure but easily accessible location. Be wary of the security of any cloud system you use for this purpose.
Visa and immigration
A range of visas are offered to live or work in the UAE. The application process varies depending on whether, at the time of the application, an individual is outside the UAE, in the UAE on a visitor’s visa or if they have a cancelled employment visa from a previous employer. The application process involves obtaining an entry permit, medical test, Emirates ID and health insurance coverage before the residency visa is issued. In ADGM, using one of the approved health insurance providers will speed up the visa application process.
A PRO (Public Relations Officer) is the ultimate gofer in your business: the PRO liaises with government agencies on your behalf. Using a PRO can free you up from the often tiresome operations and procedures at government agencies given their familiarity with matters such as visa processing and renewal, legal translations and notary and attestation requirements. PROs are particularly important for businesses operating onshore in the UAE.
Confirm bank requirements (including minimum balances, giving post-dated cheques and guarantees) and charges (including account opening fees). If your business will be dependent on banks for its operation, these charges can be significant and may not always be suitable for a startup. Also consider ease-of-use: can you use an online product to transfer funds or will you be searching for an ATM to deposit notes to pay off your company credit card? Once you have your business account and credit cards, use them for your business (not any personal accounts or credit cards to respect the limitation on liability you sought from the incorporation of your company – see Corporate Governance below).
In addition to the immigration requirements on health insurance, a business insurance policy should form part of your insurance coverage. An insurance broker can assist with the process and advise you on your changing insurance needs as your business grows. At the outset, consider your need for public liability, company vehicle and contents insurance
Growing your team involves not only finding the right people to share your dream but also navigating the employment regulations and procedures. To start the process, an employee will need an offer letter from your company. The employment laws and regulations in the UAE (whether onshore or in one of the free zones in the UAE) specify certain minimum employment standards which cannot be waived. Employers must also use a standard form employment contract which is issued by the Ministry of Human Resources and Emiratisation (formerly the Ministry of Labour) or the relevant free zone authority. Employers typically supplement the standard form with their own, more comprehensive form of employment contract. Employers are responsible for the costs of the employee’s UAE employment visa, work permit and Emirates ID. Employing staff also comes with responsibilities including occupational health and safety, fire safety, and providing a suitable working environment. Setting boundaries and standards, in the form of policies, will encourage performance. Policies also allow you to outline what is acceptable in your business and, if implemented correctly, you can develop and change them to suit your growing business without having to get the agreement of each individual employee.
If you’d like to know more, please see STAFF my business for information on employees.
The smallest of businesses will have its own accounting needs. The upcoming VAT regime in the UAE may bring an additional layer of recording and reporting for your company. While some founders meet these needs themselves, it is possible to outsource some or all of this function at an affordable price point. Your accounting needs will continue to grow alongside the business so getting organised from the start can avoid delays later.
A capitalisation table summarises the ownership structure of a company by setting out all the securities (e.g. shares and options) and debt instruments in the entity and the owner of each. The capitalisation table is useful to refer to when making business decisions: you can show the impact of events on the ownership of the company e.g. issuing more shares and using the proceeds of to repay debt.
If you’d like to know more, please see What is a Capitalisation Table and why do I need one? for information on capitalisation tables.
Corporate Governance and the “Corporate Veil”
One of the key reasons people choose to incorporate a company is to enjoy the benefit of a limitation of personal liability. To respect this limitation, it is crucial to separate the founders’ respective personal and business affairs: founders shouldn’t put any personal arrangements through the company (e.g. personal expenses) and they shouldn’t use their own personal name for any business arrangements (e.g. all contracts should be in the company’s name). Having a company also involves balancing the competing interests of various stakeholders including shareholders, management, lenders, government, customers and suppliers. To manage this, a company needs good corporate governance in the form of rules, policies and procedures which set out how the company will be directed and controlled. Founders should familiarise themselves with good corporate governance standards, implement policies and procedures and maintain them to the relevant standard.
If you’d like to know more, please see START my business for information on corporate governance.