Establish Your Business in Dubai with Dubai’s New Virtual Company Licence

The need for a physical workplace is slowly and steadily becoming less. The internet, smartphones and communication platforms have enabled entrepreneurs to do business around the world remotely and without being physically present all the time.

Recognizing this and recognizing the need to leverage entrepreneurs and small businesses around the globe for upcoming Expo2020, Dubai has launched a Virtual Commercial City (VCC) program.

The virtual company license is the first set of services offered under the Virtual Commercial City (VCC) program.

Starting a business in Dubai just got easier with the help of the virtual company license. Next generation of entrepreneurs can take advantage of this to expand their presence in Dubai or UAE. Dubai government is welcoming you to start your business in Dubai by being in your home country.

As per the VCC website “Your business idea is not limited to where you live or work. The Dubai Virtual Commercial City offers an innovative opportunity to register and manage a business online without the need to be a resident of Dubai or the UAE. You can access and operate your business from anywhere in the world.”

Below are key information on the Virtual Company License Program that you need to know.

1. What is virtual company license?

The virtual company licence allows business people, entrepreneurs and freelancers to operate their company virtually in Dubai without requiring residence and physical presence of organization. This allows the licence holder to manage their business activities digitally including signing of documents.

This license has been introduced by the combined efforts of the Dubai Economy, General Directorate of Residency & Foreigners Affair (GDRFA), The Supreme Legislation Committee, Smart Dubai and the Dubai International Financial Centre (DIFC).

2. Who are eligible for the virtual company license?

Listed are some of the virtual company license requirements, the entrepreneurs have to meet to become eligible.

• Virtual companies are registered in Dubai to individuals who don’t reside in UAE
• The owner of the company must be a national or tax resident of one of the approved countries. The approved countries include:
  • India, Pakistan, Saudi Arabia, China, Russia, North Americas, South Africa, Nigeria etc.
• Only business activities from pre-defined sectors can set up under the virtual business in Dubai.
• All applicants for a virtual company license are subject to background checks by Dubai government authorities.

3. What are the other key info I need to know about virtual company license?

• The licence will not automatically guarantee physical access to the UAE be it in the form of a business or visitor or resident visa to any of the company’s partners or employees.
• Virtual companies remain subject to corporate, individual income and social taxation in the country of incorporation and/or residence, depending on the location of economic activities and international tax agreements.
• A virtual company license does not automatically guarantee a business bank account in the UAE. Bank account opening will be at the discretion of commercial banks. However, access to account opening processes is facilitated.
• Virtual companies that have the legal form of a sole proprietorship are not subject to local ownership, director, auditor, or qualified business service provider requirement.
• VAT Tax registration with UAE’s federal tax authority is required if the company’s revenue within the UAE exceeds USD 100,000 per annum. Tax registration is the obligation of the virtual companies. Value-added tax (VAT) in the UAE is 5%, there are no income taxes on non-financial entities.

4. Is there restriction by industry while applying for VCC?

The licence is allowed only to predefined sectors such as,

• Service activities related to printing and advertising;
• Computer programming,
• Consultancy and related activities; and
• Design activities including fashion design

5. How to register a virtual company in Dubai?

• You need to register online and file an application through the website www.vccdubai.ae .
• A background check is done within 1-30 days by the UAE government
• The process is followed by Identification and validation visit (done through VFS Global)
• Once done and cleared, a request for payment of fee will be made
• Once the prescribed payment is made, you can receive your Virtual Company Licence
• Below is the process explained in the VCC website

6. How much does it cost?

• Identification, document and passport validation at VFS Global – Approx. USD 100 (AED 350)
• Cost of virtual company licence for two years – Approx. USD 500 (AED 1750)

7. What are the allowed business activities for virtual companies?

a) Service activities relating to printing and advertising:

• Books Binding
• Typesetting Services
• Color Separation Services
• Design & Artwork Services
• Greeting Cards Production & Distribution Services
• Promotional Gifts Preparing

b) Computer programming, consultancy and related activities:

• Computer Systems & Communication Equipment Software Design
• Electronic Chips Programming
• Web-Design
• Social Media Applications Development & Management
• Cyber Security Architecture
• Public Networking Services
• Cyber Risk Management Services
• Auditing, Reviewing and Testing Cyber Risks
• Managed Cyber Security Services Provider
• Marketing Services Via Social Media

c) Creative Design:

• Fashion Design
• Jewelry Design
• Design Services (interior design, garden design)
• Calligraphers & Painters
• Product Design

8. What is Dubai Store?

• Once you get a virtual trade licence, you can list your products and services at Dubai Store.
• DubaiStore.com is operated by Digital Economy Solutions LLC, a joint venture company between the Department of Economic Development (DED) and Emaratech.

9. Where can I get more information?

• https://vccdubai.ae/
• https://www.government.ae/en/information-and-services/business/dubai-virtual-commercial-city
• https://gulfnews.com/business/explained-how-can-i-get-a-dubai-virtual-commercial-licence-1.1569919811737
• https://fintechnews.ae/5032/fintechdubai/dubai-just-launched-a-virtual-company-license-and-it-costs-us233/