Today, the UAE is the most active economic player in the region of the Middle East and North Africa. Taking into account all the available advantages for foreign business in free zones, it is also the most promising jurisdiction for foreign investment. Dubai franchise market is estimated at approximately $10 billion.
Business for sale in Dubai is a very popular investment solution, and this fact becomes immediately noticeable at every street of the city: you can notice Costa Coffee, Caribou Coffee or Caffe Nero coffee shops, McDonald’s, KFC and Subway fast-food restaurants, as well as Natural Ice Cream, Lassi Shop supermarkets, Uber taxi and so on. Franchising in Dubai is represented in over 70 sectors of the economy – education and healthcare, various services, catering, etc. The annual growth in this business segment is more than 25%. Among the advantages of a franchise in Dubai are the following:
- Monopoly on the provision of a service or product in a region;
- The proven effectiveness of a product or service;
- Promoted brand or trademark, low advertising, and marketing expenses;
- No need to invest in new brand developments.
- Possibility of full company ownership by a foreigner in a free zone.
- Complete freedom of taxes on profit, export/import duties, and other types of taxes.
There is no special law governing the franchising industry in the United Arab Emirates. The main legislative act for this industry is the Federal Law, Commercial Agencies Law. According to this law, UAE citizens or companies established by them can own a franchise. Besides, a franchise agreement must be registered with the Dubai court. Such an enterprise may be opened in the territory of a free economic zone. The relations of the two parties, their rights, duties and responsibilities, are governed by the franchise contract and the operating manual developed by a franchisor. A franchisor must also take all necessary measures to protect the rights of own intellectual property, including logos, trademark and business processes.
How to open a franchise in Dubai, UAE?
So, here is a typical sequence of actions for those planning to open a franchise in Dubai:
- Choose the industry in which you want to work and study the legislation on franchising in Dubai;
- Examine the list of franchisors in your industry, select the most interesting ones. Be sure to check the following:
- Is a license exclusive?
- What are the restrictions on its use (territorial, in terms of sales/production)?
- What is the amount of royalties and payment schedule?
- Who pays for the maintenance of the intellectual property?
- What are the duration of the license and the conditions for terminating it?
- What is the procedure for resolving disputes between partners?
- Draw up a draft contract and show it to a lawyer (our experts can help you do everything correctly);
- Make a detailed business plan for the implementation of a project;
- Register a franchise agreement with Dubai Court;
- Register a company and get a license. Our consultants will help you in this matter; they will choose the best jurisdiction for your business and help you at all stages of the process of registering a new company.
Dubai encourages the development of franchising as a segment of small and medium-sized businesses. Take this opportunity and create your own profitable business in this country.