Key Takeaways
- If a quote gives one total without separating government fees from service fees, you can't compare it. Each government fee has a published amount you can look up.
- No provider can promise you a bank account. Central Bank due diligence guidance says banks should not establish or maintain a relationship when they can't complete their checks.
- Under Executive Council Resolution 5 of 2024, a Dubai licence can be issued before the permits. A fast licence doesn't mean you're allowed to start trading.
- When a provider keeps your portal login, a change of ownership can miss its 15-day deadline. Late updates are fined from the second breach onward.
- Offshore companies still need licences to do business in the UAE. Anyone who calls one tax-free without registration should back that up with a written tax opinion.
A business setup scam in Dubai doesn't always look like one. Often the warning sign is a gap in a quote or a contract that only costs you money later. This page names no provider. It describes the red flags as patterns and gives you a check for each that you can run yourself. Most providers do competent work, and any one pattern may have an innocent reason. What counts is whether the provider gives you a clear answer when you raise it. The rules described here are as of October 2026.
Hidden fees in a quote with no split between government and service fees
The first warning sign is a quote with one total and nothing underneath. If the government fee and the provider's service fee aren't shown separately, you have nothing to compare. Check too that the quote mentions renewal, the establishment card (the immigration record that lets your company sponsor visas), the medical test, Emirates ID, Dubai Chamber membership, audit and tax registration.
The split matters because government fees are published. Take Ejari, Dubai's official register of tenancy contracts. Registering a company lease costs AED 220 through a trustee centre. Where tenant and landlord are both individuals, it's AED 177.75 through the Dubai REST app or the Dubai Land Department website (fee schedule, October 2026). Both amounts include a knowledge fee of AED 10 and an innovation fee of AED 10. A Dubai dual licence, which lets a free zone company run a mainland branch from its free zone office, costs AED 10,000 a year (Executive Council Resolution 11 of 2025, Article 12). The Dubai International Financial Centre (DIFC) charges USD 12,000 a year for its licence, according to its Table of Fees of 30 July 2026.
When a figure in the quote is far above the authority's own, the provider should be able to explain why. The ten-line sheet in what a business setup package includes and leaves out shows how to ask for the split.
Promises about bank accounts and visas
The bank decides whether you get an account. Your provider doesn't. The Central Bank's guidance on customer due diligence, the checks a bank makes on who owns a company and where its money comes from, says banks should not establish or maintain a relationship when those checks can't be completed. Its rulebook lists the guidance as in force from 7 November 2025, and there's an April 2026 update to look out for. Among the red flags it names are nominee shareholders, ownership that's hard to trace, an unclear source of funds, and a newly formed company funded with a large sum.
Free zone companies have had particular trouble. At the Dubai Free Zones Council meeting of 25 December 2025, the Economic Security Centre of Dubai pointed to the challenges they face in opening bank accounts (Dubai Media Office). For what a bank wants to see from you, read the guide to bank account rejection.
Visas work the same way. No one can promise one until the visa quota, the desk and the establishment card exist. The quota is the number of residence visas your company may apply for. Free zones set it in their packages or desk rules. On the mainland, the Ministry of Human Resources and Emiratisation (MOHRE) sets it after Ta'qeem, its check of your business before it fixes the work-permit quota. The Federal Authority for Identity, Citizenship, Customs and Port Security (ICP) lists a fine of AED 20,000 for an employer that isn't actually conducting business. You'll find it on its entry permit and establishment card service pages (October 2026). The free zone visa guide walks through the order of steps.
A better request is a statement of what the provider will actually do. For example, it prepares your bank application, introduces you to named banks and refunds a set part of its fee if the bank says no. A provider can keep that kind of promise. Nobody can promise approval.
How payments and documents are handled
Pay the company named in the contract, into an account in that company's name, and get a tax invoice for it. Stop if you're asked to pay a personal account or a different company from the one you signed with, or to pay without a receipt.
Three habits around documents matter more than the price. One provider keeps your login to the government portal. Another holds on to the original licence or memorandum of association (the founding contract between the owners). A third registers your company at its own address and doesn't give you access. Setup advisers say any one of these can leave an owner unable to act for their own company.
A legal deadline is at stake as well. A change of ownership must be recorded within 15 days (Cabinet Decision 109 of 2023). Under the beneficial owner rules, which require a company to record the real person who owns or controls it at the end of the chain, a first breach brings a written warning. A late update then costs AED 15,000 on a second breach and AED 30,000 on a third (Cabinet Resolution 132 of 2023).
Have the logins set up in your own name. Collect the originals at handover and check that the lease is in the company's name. The Dubai Land Department says a commercial Ejari must be issued under the licensed company's name (October 2026).
Licence speed claims and permits
Getting a Dubai licence can take minutes. Getting permission to trade often takes longer. Executive Council Resolution 5 of 2024 lets the Department of Economy and Tourism (DET), Dubai's mainland licensing office, issue licences instantly. The exception is a list of activities set by a resolution of the Chairman of the Executive Council. For those, permits or approvals must come before the licence. For everything else, the investor signs an acknowledgement and undertaking, and the permits, qualification checks and on-site inspection take place before the activity starts. Check with DET whether the Chairman's list includes your activity.
A promise of a licence in 24 hours for any activity tells you little unless it comes with a plan for permits. The same goes for the cheapest package offered for an activity that needs a regulator's approval. Find out which permits your activity needs, who gets them, and from what date you may trade. Your activity code is the exact business you may carry out, picked from an official list. The guide to choosing the right activity code shows where its wording decides the approvals.
Nominee and local sponsor arrangements
Most mainland activities can be 100% foreign owned under the Commercial Companies Law (Federal Decree-Law 32 of 2021). The exceptions are strategic impact activities and activities a regulator restricts. A local sponsor isn't the default any more.
Government pages don't agree on the service agent, a UAE national who handles government paperwork for a fee but owns no shares. u.ae's guide to starting a mainland business (16 July 2026) says businesses owned completely by non-GCC residents need a local service agent from the UAE. GCC stands for the Gulf Cooperation Council states. The guide adds that the agreement must be attested by a notary public or the court. The foreign ownership page on u.ae (updated 6 April 2026) says something different. According to that page, the old rule of 51 per cent Emirati ownership or a local agent was removed for most activities, and branches no longer need an Emirati service agent. Your licensing authority can tell you whether your activity needs one.
If the authority does require a service agent agreement, that's a normal document. A nominee arrangement, where someone holds shares on paper for another person, is something else. A provider that calls one standard owes you an explanation.
Side letters that give the agent control or a cut of the profit shift ownership, on paper, away from the person who paid. Central Bank guidance counts nominee shareholders as a red flag, and a nominee setup may also fail the bank's checks. The beneficial owner rules say the company has to record the natural person who really owns or controls it, usually anyone at 25% or more (Cabinet Decision 109 of 2023). A nominee board member has to tell the company within 15 days of gaining or losing that status.
Get copies of every agreement the agent signs, side letters included, and have a lawyer in the UAE read them before you pay.
Offshore described as tax-free
An offshore company is still part of the UAE legal system. Under the Jebel Ali Free Zone (JAFZA) Offshore Companies Regulations 2023, a JAFZA offshore company may hold a UAE bank account and own shares in UAE companies. It still needs the proper licence or permit to do business, and breaking that rule means a fine of AED 50,000 (Regulation 14 and Schedule 3).
The Ras Al Khaimah International Corporate Centre (RAK ICC) has a similar rule. A company registered there may not carry on activities in the UAE outside the zone without the right licences (RAK ICC Business Companies Regulations 2018, Regulation 40(8)). Its registry fees are in its own fee schedule, so get the current first-year amount from RAK ICC.
On tax, the claim needs a closer look. Corporate Tax law treats a juridical person, meaning a legal entity such as a company, incorporated or established under UAE law as a Resident Person. That includes a Free Zone Person (Federal Decree-Law 47 of 2022, Article 11(3)(a)). Whether and when your offshore company must register is a question for the Federal Tax Authority (FTA) or a tax adviser. Late registration costs AED 10,000 (Cabinet Decision 75 of 2023 as amended). If someone tells you there's no tax and no need to register, they should give you a written tax opinion for your case. That opinion is work for a corporate tax consultant. The English text of FTA decisions is not an official translation.
Checks you can do yourself in ten minutes
You don't need a lawyer for any of these, and the first three take a few minutes each.
- Find the provider's licence number, look it up with the authority that issued it and read the activities it's licensed for. In Dubai that's DET (formerly DED) for the mainland, or the free zone. In Abu Dhabi, look to the Abu Dhabi Department of Economic Development (ADDED). For a Dubai firm, the QR code on the Dubai Unified Licence gives you a first look at the company's details (Dubai Media Office, December 2023). Then confirm the number with the authority.
- If the provider says it's a zone's partner, get the zone itself to confirm that in writing.
- Put the quote into the ten-line comparison sheet and mark every missing line as a question.
- Check each government fee against the authority's own page.
- Confirm which company you're contracting with, that the payment account is in its name, and that a tax invoice will follow.
- Find out who holds the logins, the originals and the registered address, and have all of them put in your name.
- Get the permit plan for your activity code and the date from which you may trade.
- For virtual assets, check the public register of the Virtual Assets Regulatory Authority (VARA). For a company in the DIFC or Abu Dhabi Global Market (ADGM), check the corporate service provider against the centre's own list.
Once you have clear answers to all eight, you have what you need to decide. The guide to choosing a consultant adds twelve questions and what a written scope should contain. For help with visa and licence paperwork, see the guide to PRO services.
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