In recent years, the amount of companies based in Dubai has grown rapidly as more global companies and ambitious entrepreneurs have looked to the UAE and, in particular, Dubai, as a good place to do business. They have made Dubai a base because of the excellent infrastructure, the plentiful investment available, government incentives and a thriving economy.
Of course, this economic growth means more businesses are looking for workers to help them grow and achieve their potential. In Dubai, there are businesses in a vast range of sectors, from construction to administration to technology, which means manpower supply businesses have never been more needed.
This article will cover:
- Steps to start a manpower supply business in Dubai, UAE
- Rules for starting a manpower supply business in Dubai, UAE
- Cost of setting up a manpower supply business in Dubai, UAE
- Why work with Worldwide Formations
Steps to start a manpower supply business in Dubai, UAE
If you have decided to set up a manpower supply business, here are the major steps that need to be completed before it can begin trading.
The first step on the road to becoming a fully-fledged company is to secure a Manpower Supply License (MR 1283), which is also called an On-Demand Labour Supply License and is granted by the Ministry of Human Resources and Emiratisation. A Manpower Supply License will enable the business to provide staff to other businesses and be a conduit between owners and their workers.
Secondly, you need to apply to register the name of the business. Whatever name is chosen must be unique to your business and not used by any other in Dubai in order to avoid any confusion. Once a suitable name has been decided on, it needs to be registered at the Registry Office.
After the name has been approved by the authorities, the next step is to apply to have the Memorandum and Articles of Association of the business notarised. This is carried out at the Department of Economic Development.
Following this, you need to apply for final approval to obtain a Manpower License. For this, various documents have to be handed in including the shareholders’ passports, copies of the applicant’s family book and ID Card (if they are nationals), a statement of their good conduct, evidence of the Trade Name application, written statements from the shareholders on the company’s opening and blueprints of the premises that are intended to be used by the business. All necessary fees must be paid to the government too before the final approval is given.
Once approval has been received, the license will be issued by the relevant authority. Please note this isn’t a one-off payment – the license has to be renewed every year.
The fifth step is applying to the Ministry of Human Resources and Emiratisation for the Establishment Labour Card, which will enable you to recruit people, as well gain work permits and make applications for visas for workers. If it is approved, it will be issued straightaway. This card confirms your business has been registered with the Ministry of Human Resources and Emiratisation and given a registration number. It is good until the trade license is ended.
Once that has been approved, you will have to register indigenous staff with the Ministry of Human Resources and Emiratisation.
The final step is to get your employees registered with the General Authority for Pension and Social Security, this is the government organisation that handles pension and retirement benefits for UAE nationals.
Rules for starting a manpower supply business in Dubai, UAE
There are a raft of rules that those wishing to establish a manpower business must adhere to. For instance, only UAE nationals over the age of 21 are allowed to apply for a Manpower Supply License. Applicants must also have proof of at least a high school degree, but preferably a degree of graduation.
In addition, the agency manager must be a UAE national and registered at the Ministry of Human Resources and Emiratisation. They are also expected to be experienced and have all relevant qualifications.
All directors in the company should have an unblemished criminal record. The authorities in the UAE are strict about any convictions that directors have had, as it seeks to enrich its reputation as a reputable and safe place for businesses to trade.
Another requirement is for the company to hire enough supervisors and administrators to ensure that it can carry out its functions to an acceptable minimum standard.
Costs of setting up a manpower supply business in Dubai, UAE
There are numerous costs that come with establishing a manpower supply business. These include AED 2,000 for every worker that is being hired. This is an obligation of MR 1283 to help ensure that employees are protected and that everything is done legally – Dubai’s government is strict on these matters.
Another cost that entrepreneurs need to be aware of is that a bank guarantee of AED 300,000 must be submitted to the Ministry of Human Resources and Emiratisation for however long the Manpower Supply License lasts. Again, this is designed to ensure that businesses have enough capital behind them to be able to carry out their duties.
In addition, the process of applying for the Establishment Labour Card costs AED 2,000, not including typing fees.
When establishing the business, entrepreneurs also need to choose a head office for their operations, which comes with numerous costs, whether this property is bought or rented. If buying, these costs include surveys, lawyers fees, mortgage payments and fitting out the premises with furniture etc. and any building work to configure it in the desired format. Renters also have to be mindful of paying a deposit up-front, as well as monthly payments going forward. They also have to consider the costs of fitting the premises out.
Worldwide Formations can provide information and advice on the expenses that business owners will face when establishing a business to supply manpower in Dubai.
Why work with Worldwide Formations?
Manpower supply businesses can be highly profitable in Dubai given the constant demand for workers – both domestic and from overseas – from businesses in a wide variety of sectors, which is why many entrepreneurs are looking to set such companies up.
Other benefits of running a business in Dubai include the favourable tax regime, free transfer of money, no foreign exchange controls and low operational costs.
But, as detailed briefly above, the process of setting up a manpower supply business in Dubai, UAE can be a lengthy and complicated process and can come with risks if the entrepreneur is not legally savvy. However, consultants such as Worldwide Formations can provide help to entrepreneurs to manage this process as smoothly as possible.
Worldwide Formations are vastly experienced in the process of setting up manpower supply businesses in Dubai, UAE; with our local knowledge, our consultants can navigate the complexities with skill and speed to ensure your company is fully set up and legally compliant as soon as possible.
For more information and a personalised quote, please visit the Worldwide Formations.