What no one tells you before opening a business in the United Arab Emirates

More and more Romanians are choosing to set up a business in Dubai to benefit from a friendly tax regime and a quick opening to global markets. But even if the process seems simple “on paper”, the reality is that many firms face bottlenecks, delays or hidden costs that could have been avoided.

In the following we will discuss the 5 most common mistakes made when setting up a business in Dubai and the simple solutions you can avoid them — legally and stress-free.

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1. Wrong choice of economic zone (Free Zone vs Mainland)

One of the most common mistakes is the choice of an economic zone unsuitable for the desired activity. For example, a freelance consultant who provides international services does not need a firm in the Mainland, but in the Free Zone, where the costs are lower and there are no restrictions on owning the firm.

On the other hand, an entrepreneur who wants to sell services in Dubai to local clients will not be able to operate legally only with a Free Zone license — and will have to restructure his structure.

The impact of the mistake:

•Additional costs for changing the structure of the firm

•Delays in activity

•Legal Limitations in Customer Relations

How to avoid it:

•Require an eligibility analysis before choosing the economic zone

•Collaborate with a consultant who knows the real differences between Free Zones (ex: Meydan, IFZA, DMCC)

2. Lack of own bank account (or choosing the wrong bank)

After obtaining the license, many entrepreneurs assume that they will be able to quickly open a bank account in Dubai. In reality, UAE banks have strict compliance policies and can reject applications for minor reasons: incomplete documents, lack of clear business activity or even misunderstanding of the structure of the firm.

The impact of the mistake:

•The company is registered but not operational

•You can't bill, charge, or pay suppliers

•Time lost with file restoration or bank change

How to avoid it:

•Choose a consulting firm that also offers you bank account support

•Prepare documents in advance: business plan, estimate invoices, CV, company profile

•Opt for local digital banks if you have a simple business

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3. Obtaining an inappropriate commercial license

The commercial license legally defines what your business can do. Many entrepreneurs choose a “generic” license or an incorrect one over the real business (ex: “General Trading” for IT consulting), which can lead to:

The impact of the mistake:

•Bank account refusal (activity-license incongruence)

•Legal non-compliance in Dubai

•Impossibility to conclude contracts or issue invoices

How to avoid it:

•Discuss with a local consultant what actual work you will be doing

•Choose the license according to the approved commercial codes in the economic zone

•Review options before submitting documents

4. Underestimation of real costs (including annual renewal)

Offers like “business in Dubai with 5000 AED” circulate frequently online. In reality, the full costs include not only the license, but also: visa, Emirates ID, bank account, support services, virtual space, government fees and — crucially — annual license renewal.

The impact of the mistake:

•The firm can be suspended if it is not renewed on time

•Unforeseen costs after the first year

•Contractual misunderstandings with service providers

How to avoid it:

•Ask for a full 12-month offer from the start

•Ask clearly what is included and what is NOT included in the proposed package

•Plan a budget for the coming years, not just for the establishment

5. Non-ownership of mandatory space (headquarters or virtual address)

Even in the Free Zone, some authorities require proof of a minimum registered space — be it virtual or physical. If you skip this step or choose an area that requires a physical office, you risk being denied your license or having to pay unforeseen rents.

The impact of the mistake:

•Delay in issuing a license

•Additional rental costs

•Ineligibility for a residency visa

How to avoid it:

•Opt for Free Zones that offer packages with virtual address included

•Check the minimum requirements for your business

•Avoid areas that require renting a physical space if you don't need to

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Setting up a business in Dubai is a relatively simple process, but frequent mistakes can turn everything into a long and expensive road. With the right advice, the right choice of area, license and bank, the process becomes clear, fast and legal.

To avoid these problems from the start, we recommend working with a team that offers complete packages: license, documentation, visa, bank account and local legal support.

Want to start a business in Dubai without hassle?

For the detailed steps read The Complete Guide to Setting Up a Business in Dubai 2025

Request Full Consultation for Dubai Business Setup

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