In this article, we will explore the intricacies of setting up a business in Ajman, a vibrant and rapidly growing city in the United Arab Emirates. With its attractive business landscape, Ajman has become a preferred destination for entrepreneurs looking to establish their presence in the region. From understanding the legal requirements to navigating the cost considerations, we will delve into the essential aspects that every aspiring business owner should be aware of. So, if you are contemplating starting a business in Ajman, join us as we unravel the details behind the cost of setting up a business in this thriving city.

Legal Requirements for Setting Up a Business

Starting a business in Ajman requires compliance with several legal requirements. Understanding these requirements is crucial to ensure a smooth and successful business setup process. Here are the key legal requirements you need to be aware of:

Trade License

Obtaining a trade license is a fundamental requirement for setting up a business in Ajman. A trade license grants you the legal permission to operate your business activities within the emirate. The types of trade licenses available include commercial licenses for trading activities, industrial licenses for manufacturing activities, and professional licenses for service-oriented businesses.

Registration with Department of Economic Development

Registering your business with the Department of Economic Development (DED) is another important step in the setup process. This registration ensures that your business is recognized and authorized by the Ajman government. It involves submitting necessary documents, such as the trade license application, business plan, and relevant identification documents.

Visa and Immigration Procedures

If you plan to employ staff from overseas or relocate yourself to Ajman for running the business, visa and immigration procedures must be followed. This includes obtaining employee visas, dependent visas for family members, and ensuring compliance with immigration regulations. It is recommended to seek professional assistance to navigate the complex visa and immigration process.

Local Sponsorship

In Ajman, non-GCC nationals are required to have a local sponsor or partner when setting up a business. The local sponsor acts as a liaison between the foreign business owner and government authorities. The sponsorship fee and percentage of ownership requirement may vary depending on the nature of your business and the agreement with the local sponsor.

Types of Business Entities

Ajman offers various options for structuring your business entity. Each type has its own advantages and requirements. Here are the common types of business entities you can consider:

Sole Proprietorship

A sole proprietorship is the simplest form of business ownership, where an individual owns and runs the business. The owner has unlimited liability for the business’s debts and obligations. Setting up a sole proprietorship in Ajman requires obtaining a professional license or a commercial license, depending on the nature of the business.


A partnership involves two or more individuals coming together to run a business. The partners share the profits, losses, and responsibilities of the business. There are different types of partnerships, including general partnerships and limited partnerships. Registering a partnership in Ajman requires drafting a partnership agreement and obtaining the necessary licenses.

Limited Liability Company (LLC)

An LLC is a popular choice for businesses in Ajman as it offers limited liability protection to its owners. In an LLC, the business and its owners are considered separate legal entities. This means that the owners’ personal assets are protected from the company’s liabilities. Forming an LLC in Ajman requires a minimum number of shareholders and compliance with the legal requirements set by the DED.

Branch or Representative Office

If you want to establish a branch or representative office of an existing company in Ajman, you have the option to do so. This allows you to expand your business presence without creating a separate legal entity. However, a branch or representative office is subject to certain restrictions and needs to comply with DED regulations.

Cost of Trade License

Obtaining a trade license involves various fees and charges. It’s essential to understand the cost breakdown to plan your budget effectively. The cost of a trade license typically includes the following:

Trade License Application Fee

When applying for a trade license, you are required to pay an application fee. This fee covers the administrative costs associated with processing your application. The amount varies depending on the type of license and the nature of your business.

Trade License Renewal Fee

Trade licenses in Ajman need to be renewed annually. Before the expiration date, you must submit the renewal application and pay the renewal fee. The renewal fee covers the costs of reviewing your business’s ongoing compliance with the regulations and ensures the license remains valid for another year.

Trade Name Reservation Fee

Before obtaining a trade license, you may need to reserve a unique trade name for your business. This ensures that no other business can use the same name. To reserve a trade name, you need to pay a reservation fee. The fee varies depending on the duration of the reservation, ranging from a few weeks to several months.

Cost of Registration with Department of Economic Development

Registering your business with the DED incurs certain costs. It’s crucial to understand the expenses associated with the registration process. The cost of registration includes:

Registration Fee

To register your business with the DED, you need to pay a registration fee. This fee covers the administrative expenses of processing your application and ensuring your business is legally recognized. The amount varies depending on the type of license and the size of your business.

Annual Renewal Fee

Similar to trade licenses, the registration of your business needs to be renewed annually with the DED. The annual renewal fee covers the costs of reviewing your business’s ongoing compliance and maintaining its registered status. The amount varies depending on the type and size of your business.

Cost of Visa and Immigration Procedures

If you plan to hire foreign employees or relocate yourself to Ajman, you need to consider the costs associated with visa and immigration procedures. The costs typically include:

Employee Visa Fee

When hiring foreign employees, you need to apply for employment visas on their behalf. The employee visa fee covers the costs of processing the visa application and ensuring compliance with immigration regulations. The fee varies depending on the type of visa and the duration of employment.

Dependent Visa Fee

If you have family members who will be joining you in Ajman, you need to apply for dependent visas for them. The dependent visa fee covers the costs of processing their visa applications and ensuring their legal presence in the emirate. The fee varies depending on the relationship with the dependent and their age.

Visa Renewal Fee

Visas in Ajman need to be renewed periodically. This involves submitting a renewal application and paying the visa renewal fee. The renewal fee ensures the continued validity of the visa and covers the administrative costs of the renewal process. The amount varies depending on the type of visa and the duration of renewal.

Cost of Local Sponsorship

For non-GCC nationals, having a local sponsor is mandatory when setting up a business in Ajman. The cost of local sponsorship includes:

Sponsorship Fee

The local sponsor charges a sponsorship fee for their services. This fee covers their role as a liaison between you and the government authorities. The sponsorship fee may vary depending on the agreement with the sponsor and the nature of your business.

Percentage of Ownership Requirement

In Ajman, the local sponsor is required to have a certain percentage of ownership in the business. The percentage may vary depending on the business activity and the agreement with the sponsor. It’s essential to negotiate the ownership percentage and financial arrangements with the local sponsor accordingly.

Business Setup in Free Zones

Ajman also offers free zones where businesses can set up their operations. Free zones provide various benefits and incentives for businesses, such as tax exemptions and simplified business setup processes. Here’s an overview of free zone setup:

Benefits of Free Zone Setup

Setting up a business in a free zone can be advantageous for several reasons. Free zones offer 100% foreign ownership, customs duty exemptions, and simplified regulations. Additionally, businesses in free zones can benefit from a dynamic business environment, proximity to logistics hubs, and access to state-of-the-art infrastructure.

Costs Associated with Free Zone Setup

While free zones come with numerous benefits, there are still costs to consider. Free zone setup costs typically include license fees, office space rent, visa and immigration fees, and other administrative charges. It’s important to research and compare the costs associated with different free zones to make an informed decision.

Cost of Office Space and Utilities

Securing office space is an essential aspect of business setup in Ajman. The cost of office space and utilities can vary depending on the location and the size of the space required. Here’s an overview of the key expenses to consider:

Office Rent

Office rent is a significant portion of the business setup cost. The rent depends on factors such as the location, size, and facilities provided with the office space. It’s recommended to research the rental market in Ajman and compare different options to find a space that fits your budget and business requirements.

Security Deposit

Landlords in Ajman typically require a security deposit along with the office space rental agreement. This deposit serves as a guarantee against any potential damages to the premises. The amount of the security deposit is usually equivalent to a certain number of months’ rent and is refundable at the end of the lease term, provided there are no damages.

Utility Bills

Apart from the rent and security deposit, businesses also need to consider the costs of utilities such as electricity, water, and internet. These costs can vary depending on the size of the office space and the nature of the business activity. It’s important to factor in utility expenses when calculating the overall cost of office space.

Cost of Promotional Activities

To attract customers and establish a strong presence in the market, businesses need to invest in promotional activities. Here are the key costs associated with promoting your business in Ajman:

Marketing and Advertising Expenses

Creating a marketing and advertising strategy is crucial for reaching your target audience. The costs can include designing marketing materials, printing brochures, running online advertising campaigns, and other promotional activities. It’s important to allocate a budget for marketing and advertising expenses to effectively promote your business.

Website Development

Having a professional website is essential in today’s digital world. The cost of website development can vary depending on the complexity and functionality required. It includes expenses such as domain registration, website hosting, web design, and ongoing maintenance. Investing in a well-designed website can significantly enhance your online presence and attract potential customers.

Business Networking Events

Attending business networking events is a valuable way to connect with other professionals and potential clients. While some networking events may be free, others may require registration fees or sponsorship fees. Including such expenses in your budget allows you to leverage networking opportunities for business growth.

Cost of Accounting and Bookkeeping Services

Maintaining proper financial records is crucial for the success and compliance of your business. Outsourcing accounting and bookkeeping services can help ensure accuracy and efficiency. Here are the costs to consider:

Accountant or Bookkeeper Fees

Hiring an accountant or bookkeeper is an investment in ensuring accurate financial records and compliance with tax regulations. Their fees can vary depending on their level of expertise and the services required. It’s important to engage a qualified professional who understands the local accounting practices and can provide accurate financial reporting.

Software and Tools

Accounting software and tools are essential for efficient financial management. The cost of accounting software licenses and other tools should be factored into your accounting budget. Investing in reliable accounting software streamlines your bookkeeping process and helps in generating financial reports and statements.

In conclusion, understanding the cost of setting up a business in Ajman is crucial for effective budgeting and planning. From trade license expenses to office space costs, visa fees to promotional activities, each component contributes to your overall business setup cost. Seeking professional guidance and conducting thorough research is recommended to ensure compliance with legal requirements and optimize your budget allocation for a successful business venture in Ajman.

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