How You Can Get A Cloud Kitchen License In Dubai?

Cloud Kitchen Dubai

The food business in the United Arab Emirates has flourished for many years. To take advantage of this opportunity, astute businessmen have chosen a cloud kitchen Dubai license.

Moving to a delivery model is becoming more viable for food company owners because of the high leasing costs, changing client patterns, and limited profit margins of a typical restaurant.

Is it easy to acquire your cloud kitchen in Dubai? Let’s have a look at further details.

1. What is a Cloud Kitchen?

A cloud kitchen is a commercial facility used exclusively for the production of meals intended for delivery. It doesn’t offer a dine-in service and they accept orders on its website, online app, or telephone numbers.

2. How you can set up a Cloud Kitchen in Dubai?

To get your cloud kitchen business off to a flying start, follow these suggestions:

a) Set a Business Plan

Before starting a business, put together a detailed business plan including all of your needs and goals for the brand. The name of your brand, the amount of money you want to spend, the obligations of any partners, and the results of your market research, cloud kitchen Dubai rent, and branding all go under this category.

Do not rush this part of your setup; it will come in handy later on, particularly during the actual integration process.

b) Obtain Cloud Kitchen Dubai License

All businesses must have a license to begin and function legally. As a result, obtaining permits from the Department of Economic Development (DED) and other government agencies is a need before launching a cloud kitchen in Dubai. This license should be obtained:

c) License of Trade

You should take the cloud kitchen license from the department responsible for issuing trade permits in Dubai Economy. Furthermore, you must take care of other issues, such as securing a trading name, compiling all the necessary paperwork, and so on.

The Dubai Municipality’s Food Safety Department is in charge of issuing Food Licenses in Dubai. After obtaining a business license, you’ll need to apply for a food license.

Additional permits and certificates are required in addition to your trade license to operate a cloud kitchen in Dubai.

d) Food License

The Dubai Food Safety Department is the recipient of this component of the application. The application process will be inquired to interpret the space of your kitchen. Food storage rooms, food processing equipment, and washing equipment are all included in the floor layout with well-indicated entry/exit points and windows/ventilation.

This is the last requirement for any food-related company in the United Arab Emirates. Food preparation, storage, and cleaning facilities are all included in this category.

3. Cloud Kitchen License Cost

The cost of opening and operating a cloud kitchen in Dubai will depend on many factors. In Dubai, there is a slew of variables that will affect the cost of starting and running a cloud kitchen. Particularly noteworthy are the building’s dimensions, cloud kitchen Dubai rent, and location.

For a personalized breakdown of the cost involved in starting your cloud kitchen business in the UAE, talk to our expert Business Setup Consultants.

4. Get Your Cloud Kitchen Dubai License

The procedure of setting up a Dubai mainland account is quick and simple. Bring your paperwork to one of the designated service locations and pay the cloud kitchen Dubai cost.

5. Finalize Your Company’s Requirements

After obtaining a cloud kitchen license, you may immediately complete your company formation by obtaining the PRO services. You might need visas for yourself and your family, as well as operating space if necessary; financial services and bank accounts; a website; mobile apps; digital marketing; as well as the registration of a trademark.

Final Thought

In a nutshell, cloud kitchen Dubai is a growing business in UAE that offers good earning opportunities. To get your cloud kitchen Dubai license, feel free to contact us at +971-58-258-3505 or via email at info@dubaibusinesszone.com. One of our representatives will get back to you to help with any of your queries and concerns.

Calculate your business setup costs in 1 minute with our easy-to-use COST CALCULATOR.

How to Have a Full Ownership of Your Business in Dubai?

DED Dubai Full Ownership

The UAE Commercial Companies Law (the “CCL”) has changed to allow companies incorporated in the UAE under the CCL, sometimes colloquially called “mainland” companies, to have full foreign ownership. The foreign ownership change took effect on June 1, 2021, according to the UAE Ministry of Economy.

This change aims to stimulate business activity and attract more foreign investment into the United Arab Emirates. As per the guidelines published by Dubai’s Department of Economic Development (“DED”), full foreign ownership is available for more than 1,000 commercial and industrial activities, excluding economic activities with a strategic impact. This strategic category includes activities in core sectors such as military, banking, insurance, and telecommunications. The complete list of activities open for full foreign ownership can be viewed on the Dubai DED website via this link.

However, before you start a new business or revise your company structure, you ought to understand the conditions and intricacies involved in this amendment to the CCL.

Rules Vary in Each Emirate for Mainland Company Setup

While Dubai has around 1,000 business activities for full expat ownership, the Abu Dhabi Department of Economic Development (ADDED) has a list of 1,500 activities. The local government of each Emirate retains the final authority to decide the foreign ownership percentage.

The local Department of Economic Development can request that you submit your business proposal and documents supporting your business and specific activity for a final decision on ownership percentage. It helps to have the assistance of a seasoned consultant who can submit these documents on behalf of your business.

Impact on Existing Mainland Businesses

The status of existing business licenses structured on the 51%-49% model remains unchanged. However, you can amend your Memorandum of Association (“MOA”) and license via standard legal procedures.

Full ownership does not diminish existing requirements for licensing, except that it is no longer mandatory to have an Emirati or GCC national or company as a partner. In addition, the new guidelines do not yield in any additional fees, guarantees or capital requirements.

You cannot convert the legal form of a company from an LLC (Limited Liability Company) to an expat-owned sole proprietorship; however, the license can be transferred to a one-person company with limited liability, or you can add another expat to retain the LLC structure. Full ownership does not apply to commercial agencies, as they are regulated by the Commercial Agencies Law and not the CCL.

Previously, LLCs were required to have a share capital of at least AED 150,000, although in practice the minimum capital accepted by Dubai DED was AED 300,000. It is not necessary to deposit the share capital, companies are expected instead to have adequate share capital in order to achieve the purpose of their incorporation.

In practice, the minimum share capital imposed is at the discretion of the relevant DED in each Emirate and these authorities may continue to impose minimum share capital requirements for certain business activities.

Amending Your Existing DED License

Before you amend your existing license, you will need to ensure cooperation with the Emirati shareholder. In most cases, the Emirati shareholder is a silent partner who collects an annual fee for his or her services. You will most likely need to negotiate a final settlement fee to transfer all shares to yourself or another expat partner.

Once you have come to a mutual accord, you can proceed with a sale of share agreement and amend the MOA. We can assist with the legal process of the amendment. If the Emirati shareholder does not agree to remove himself or herself from your existing LLC company, you still retain legal and arbitration options to get full control of your business.

Impact on Free Zones

Since their inception, UAE free zones were dependent on full ownership in companies as their primary differentiator. However, the amended CCL has created a new challenge to find new ways to compete with mainland company formation, be it with their services, ease of transactions, or employment and taxation regulations.

Free zones continue to have a tax-free environment which can play a deciding factor for companies. Mainland businesses in the UAE must register for VAT if they have a turnover of more than AED 375,000 in a year. The UAE Cabinet has defined free zones as “designated zones”. These zones are outside the scope of VAT when goods are transferred between designated zones.

Long-term property leases ranging from 20 to 50 years are available in some free zones such as Jebel Ali Free Zone or Hamriyah Free Zone. Many free zones also offer freehold ownership options or virtual desk solutions for SMEs whereby a physical office is not required.

The decision to either incorporate via a free zone versus the local DED may boil down to what share of the business is transacted locally versus internationally. Entrepreneurs focused on external markets may opt to retain a free zone setup, whereas those focused domestically can save the cost of having to go via a local distributor and thereby improve profit margins.

How Do I Incorporate a New Mainland Business With Full Ownership?

The incorporation process for a new mainland business is easier than ever. Many of the procedures are available through online portals managed by the local DED. You can launch your business in 5 simple steps:

  • Think of a name for your business and select your business activity from this list.
  • Complete the incorporation paperwork. The documentation required can vary depending on the business sector. This is where a business consultant can come in handy.
  • Lease a physical site for your venture and pay the DED license fee.
  • Open a corporate bank account once you have a license.
  • Complete visa formalities for yourself and any foreign staff.

The cost for company formation in Dubai depends on the business activity, location, and the number of visas needed. You should factor in service fees for business incorporation firms, office rent, and visa costs.

Apart from foreign banks and oil companies, there is no corporate tax imposed in the UAE. There are also no restrictions imposed by the UAE authorities on the repatriation of profits for mainland businesses. Annual fees are payable to the relevant local DED authority to renew business licenses. Fees are also payable to the relevant Chamber of Commerce and other regulating agencies (if applicable).

Free Consultation for Company Setup

Our consultants are experts in Dubai and GCC incorporations, having advised on several of the region’s high-profile incorporations for franchises, private investment firms, and start-ups in multiple sectors. We also specialize in helping SMEs navigate the local business environment.