Common Challenges in Starting A Business In UAE
                     Common Challenges in 
Starting A Business In UAE
AN OVERVIEW
The United Arab Emirates or UAE is one of the best 
destinations for company formation across the world. 
This country is popular because of its business-friendly 
environment, straightforward legal framework, favorable 
tax structure, and more.
Certainly, there are many advantages of setting a 
business in the UAE. However, there are some set of 
problems that you need to face while 
company formation in UAE Free zones. 
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Let’s dive into some of the most common 
challenges that you may face while 
company formation in UAE Free zones:
▸ UAE Company Ownership
▸ Finding a Local Sponsor
▸ Implications of VAT
▸ Managing Revenue
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“ UAE Company OwnershipIf an individual want to set up a 
company in UAE, he requires a local 
sponsor. This implies that an 
individual has only 51 percent 
ownership of its company. 
Well, many business owners accept 
this criterion but it’s not easy to trust 
and rely on others for partnership.
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“ Finding a Local SponsorWell, finding a trustworthy sponsor is 
one of the biggest challenges while 
company formation in UAE Free zones. 
But, in order to set up your business in 
UAE, you need to find a local sponsor.
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“ Implications of VATRegistering VAT and going further is 
another major challenge to set up your 
business in UAE. 
However, hiring a professional 
business consulting company can be 
the best move for your business.
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“ Managing RevenueClearly, the United Arab Emirates provides 
many opportunities to run your business 
successfully. According to a report by the 
association of charted certified accountants, 
82 percent of the businesses fail due to poor 
cash flow management. 
If you want to grow your business in the 
United Arab Emirates or UAE, then you 
should focus on managing the cash flow of 
your organization.
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