As you all know by now UAE has seven Emirates and they are Abu Dhabi, Ajman, Dubai, Fujairah, Ras Al-Khaimah, Sharjah, and Umm Al-Quwain. The golden place covers around 84000 square kilometres in area and is densely populated by 10 million people. You all probably know by now that the UAE is an active part of the Organization of Petroleum Exporting Countries and so the UAE’s production targets and strategies are established by OPEC. Oil and gas production accounts for over 30% of the country’s GDP.
UAE is in the position of seventh according to the Oil and Gas Journal for being one of the finest reserves of oil in the world. Not only that, the Council announced the discovery of new hydrocarbon reserves which is worth 58 trillion standard cubic feet of conventional gas. Also 7 billion barrels of crude oil during a meeting held at the headquarters of the Abu Dhabi National Oil Company. It helped them from moving the UAE from seventh to sixth place in terms of global gas and oil reserves.
Steps on how to start a oil trading company in Dubai
You could follow certain steps to successfully start a oil trading business. In this blog, we will list them down below for you.
Select a name for your business
The first and foremost step to setting up a business in Dubai is to select a decent name that is enlightening yet attractive. Just like any other business, you will eventually start with the best name but when doing so you will have to follow certain rules and regulations.
If you want to choose a name for your Dubai company then it should be free from any form of offensive or blasphemous language. Then you can avoid using names of existing organisations. If you want your company after your company then avoid using abbreviations if any. Last but not least you must go under careful investigation on whether your name is available for registration. If the process seems tedious for you then you can consult business consultants in Dubai to do the work for you. You can save your precious time and easily manage the situation with them.
Get a local sponsor
So you have finally decided to start an oil trading business! This means that you will have to work with several government departments and the local UAE market. What does that further mean? It means that you require a local sponsor and this can either be Emirati individuals or UAE businesses.
Whatever the case almost 51% of the stake of the organisation is on hold by them. Profits, on the other hand, are not distributed according to these percentages. Most of the time, you keep full decision-making authority and pay the sponsors an annual fee for their services.
Apply for the license
Now you are done with choosing the best company name and choosing a local sponsor. The next important yet unavoidable step is to apply for a UAE trade license.
If you are in UAE mainland company formation then you can apply the license application directly to Dubai DED or if you are choosing another Emirate then you can choose a local equivalent.
It’s a simple process and won’t take much time to complete. It is usually done within hours as the process takes place via an online platform. We highly recommend you to contact the best business setup consulting agency to speed up the process for you. Once you get the license approval you are good to start your oil trading business.
Get important approvals
Next what you need is the trade license approval. It is the first thing of approval you might want in order to start an oil trading business in Dubai. You further need approval from the Supreme Petroleum Council (SPC) after sorting out your business activities. The best business setup consultant in Dubai can easily help you tackle the situation.
Visa application process
Just like a trade license you also equally need a residency visa to work efficiently in the UAE. So you require a visa and there are several steps you have to go through to finally get it. The steps include biometric scanning, a medical checkup, and a chest x-ray.
Do you know that you can sponsor your visa to another if you are a holder of a UAE business license? Yes, you can do that and give it to your partner, parent or child, or a domestic worker like the housekeeper, gardener etc. How many visas can you have? It depends upon the size of your company, your startup nature, and personal income.
Starting a corporate bank account
Last but not least, you are good to go only with Dubai business setup after starting a corporate bank account for trade in the UAE. We know that the process is tedious and it is not easy as it seems. Banking services and obtaining them will take time but you can always seek extra help and guidance to make it stress-free for you.
Documents Requirements for the oil trading business
Take a look at the important documents you need to run the dream business in Dubai. These are the documents expected from shareholders and managers. Their presence is highly needed during the formation of the company.
- Firstly you need a copy of your original passport
- Don’t forget about two colour passport photos
- Next, you need a document of the Visit or the tourist visa
- You also need a no objection letter from your sponsor that is from the chamber of commerce if you have a valid UAE visa
- You will have to submit the complete license application
- The business plan is also asked in some cases to prove authenticity
Advantages of starting an oil trading company in Dubai
- Trading in UAE will gift you with UAE’s low income, corporate, and customs tax rates
- Next, you have a super-fast, easy and cheap company incorporation process
- The location itself is a great advantage for favourable flights and overlapping time zones with profitable oil markets
If you are interested in setting up an oil business in Dubai then you must know it is a very profitable business to run. The possibility comes within the ability to build a full-fledged office. You can complete the business by providing enough facilities like a well-experienced set of staff and so on. Also, don’t forget to make use of incredible benefits like favourable taxation at a rate of 1/3 in Dubai.