The landscape of business setup in Abu Dhabi is set for a big leap with the government announcing back-to-back economic reforms. In January, the Abu Dhabi Department of Economic Development (ADDED) scrapped over 20,000 company formation requirements. And before that, the authority had slashed the cost of business setup and renewal by 94 per cent. Now, the ADDED has piqued the interest of foreign investors by announcing a one-year lease contract exemption for certain economic activities in Abu Dhabi.
Investors curious about this new development can consult with business setup consultants in Abu Dhabi for gaining relevant information. However, you need to get to know about the type of activities covered, the requirements and the scope of businesses that the exemption covers before making any decision. This article will give you a basic idea about some of these aspects so that you can approach the relevant authorities to avail of this exemption while setting up a business in Abu Dhabi. Keep reading to know further:
What’s New Lease Exemption Available in Abu Dhabi?
The Abu Dhabi Business Centre (ABC), which is a part of the ADDED, has announced that businesses can get a one-year exemption from having a lease contract for work premises. The new exemption has been announced to simplify the process of business setup in Abu Dhabi as well as improve the ease of doing business in the emirate. The move is also aimed at incentivizing entrepreneurship as it is expected to attract more foreigners to set up a business in Abu Dhabi. You can consult with business setup consultants in the UAE to obtain more information on the lease contract exemption.
Does the Lease Contract Agreement Relief Cover All Activities?
No. The new lease contract agreement exemption in Abu Dhabi covers 1,200 economic activities as determined by the ADDED. The activities covered under the new reform represent 29.5 per cent of total economic activities licenced and regulated by the ADDED, which touched 4,062 by the end of 2021.
The key segments covered by the new relief include wholesale and retail trade, cafeterias, rental and installation activities, contracting and maintenance, consulting and services, sewing, transport, salons and beauty centres, management offices and investment. You should remember that the activities listed here are not comprehensive but business setup consultants in Abu Dhabi can provide you with the complete list of activities eligible for the lease contract exemption.
How does the Lease Contract Agreement Relief Work?
Entrepreneurs should note that the lease agreement exemption is valid for one year from the date of business license issuance in Abu Dhabi. Furthermore, the business owners are required to submit the lease agreement upon the renewal of the trade license or before that. Business setup consultants in Abu Dhabi can help you with the submission of the lease contract on or before the date of license renewal.
Why the Lease Exemption in Abu Dhabi is Relevant?
As per the regulations of business setup in Abu Dhabi mainland, the investors need to rent or lease a premise to obtain a trade license. After leasing the premise, you need to get the lease contract agreement attested and submit it to the ADDED. The ADDED will verify the document and proceed with the issuance of a trade license in Abu Dhabi for your proposed company. However, the new exemption for lease contract agreements in Abu Dhabi gives great relief to new investors seeking to start a business.
Generally, the entrepreneurs require more time to finalise an office space or price that fits their business requirements as well as financial capability. The new exemption gives them more time to focus on the business and eventually select the right best location. Startups and SMEs are the top beneficiaries of this as they can manage the hefty startup expenses within the one-year window. Startups that start operations on a modest investment can cover the expenses for the premises after earning an income within one year.
Consult with the Best Business Setup Consultants in Abu Dhabi, UAE
Foreign investors welcome the new initiative to overhaul the process of business setup in Abu Dhabi as they can now obtain a trade license without leasing an office space. Even though the exemption is valid for only one year, business setup consultants in Abu Dhabi suggest foreign entrepreneurs take advantage of it. Startups and SMEs with limited investments can reduce the company formation costs arising from the leasing of premises by leveraging the exemption.
Company formation consultants in Abu Dhabi such as Jitendra Business Consultants (JBC) can advise you on how to make the best use of the lease agreement relief offered by the ADDED. JBC is a highly experienced business setup consultant in the UAE who can help you set up a company quickly. Our business setup services in the UAE include company registration, company liquidation, PRO services, visa processing, drafting of MoA & other documents, bank account opening etc. Since our consultants are well-versed in the UAE immigration and labour laws, it would be easier for you to quickly establish a business anywhere in the country.