Starting a construction company in UAE is a profitable opportunity due to the city’s ongoing growth in real estate and infrastructure projects. Whether you’re an investor, contractor, or entrepreneur, understanding how to form a construction company in Dubai is crucial. From navigating legal requirements to acquiring the right licenses, the process can be complex—but that’s where we come in. Our experienced business setup consultants are here to guide you every step of the way.
This article provides a complete guide to launching your construction business in the UAE, covering everything from legal requirements and licensing to opening a business bank account. With expert support, you can navigate the setup process smoothly and tap into one of the region’s most lucrative industries.
How You Can Open Your Construction Company in UAE?
Starting a construction company in UAE has never been easier. With streamlined procedures and strong demand for infrastructure and real estate development, you can now establish your company by following these simple steps:
Legal Structure Options
1. Limited Liability Company (LLC)
LLC is The most common legal structure for construction companies. Allows 100% foreign ownership under the recent UAE Commercial Companies Law.
2. Branch of a Foreign or Local Company
100% owned by the parent company. Suitable for companies looking to expand operations in the UAE under the same legal identity.
Business Activities to Choose
Depending on your scope of work, you can choose from the following activities under the Dubai Department of Economy and Tourism (DET):
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Building Contracting
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Steel Construction Contracting
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Road Contracting
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Concrete Works
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Landscaping Works
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Electrical, Plumbing, and A/C Contracting (may require additional approvals)
Required Approvals
To legally operate a construction company in Dubai, you’ll need approvals from the following authorities:
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Department of Economy and Tourism (DET): For the trade license
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Dubai Municipality: Technical approval for contracting activities
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Dubai Civil Defence: For construction involving fire safety measures
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Dubai Civil Engineering Department: For high-rise buildings and road works
Technical Staff Requirement
You must appoint qualified technical personnel, including:
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Engineer(s) registered with the UAE Society of Engineers
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Project Manager or Technical Manager
All qualifications must be attested and approved by relevant UAE authorities.
Office & Ejari Requirements
A physical office space is mandatory for all mainland construction companies.
You must obtain a valid Ejari (tenancy contract) before proceeding with license issuance.
License Issuance Process
The typical steps for setting up a construction company in Dubai Mainland include:
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Trade Name Reservation and Initial Approval
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Preparation and Notarization of MOA (Memorandum of Association) and, if applicable, LSA (Local Service Agent) Agreement
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Office Lease and Ejari Submission
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Engineering and Municipality Approvals
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Final License Issuance from DET
Timeline
Estimated Duration: 2 to 4 weeks
Subject to technical approvals and the availability of required technical staff.
Read more to find out whether a construction company can have dual ownership or not.
What Permits Are Required for a Construction Company in UAE?
Setting up a construction company in KSA is different from the UAE. To legally operate a construction company in the UAE—especially in Dubai—you must obtain several key permits and approvals. These are essential to ensure compliance with UAE regulations and to uphold the safety and quality standards of construction activities. Below are the essential permits and licenses required:
1. Trade License (Commercial License with Contracting Activity)
Issued by: Trade license usually issued by Department of Economic Development (DED) or Free Zone Authority
Purpose: Legally registers your construction business and specifies business activities you’re allowed to perform (e.g., general contracting, building maintenance, road construction).
2. Technical/Engineering Classification Certificate
Issued by: Dubai Municipality (or relevant local municipality in other Emirates)
Purpose: Confirms that your company meets the technical qualifications and employs licensed engineers as required for your business activity.
3. Building Permit
Issued by: Dubai Municipality or relevant local authority
Purpose: Required for each construction project. Ensures the project meets urban planning and structural safety standards before work can begin.
4. Environmental Permit (If applicable)
Issued by: Environment Agency or relevant environmental authority
Purpose: Required if your construction activity may have environmental impacts (e.g., industrial or large-scale projects).
5. Civil Defense Approval
Issued by: UAE Civil Defense Authority
Purpose: Ensures compliance with fire safety and building code regulations, especially for commercial or residential buildings.
6. Labor and Immigration Card
Issued by: Ministry of Human Resources and Emiratisation (MOHRE) & General Directorate of Residency and Foreigners Affairs (GDRFA)
Purpose: Required to hire employees and sponsor foreign workers under your company.
7. G+ (Ground +) Permits
Issued by: Dubai Municipality
Purpose: This grading system (G+1, G+4, etc.) allows your company to construct buildings up to a specific number of floors based on your company’s engineering classification and license.
Additional Notes
Consulting with business setup experts is highly recommended to ensure all permits are acquired in the right order. Free zone companies may have slightly different requirements depending on the zone’s regulations.
Cost of opening a building Construction company in UAE
Here’s a clear and professional breakdown of the cost of starting a construction company in Dubai Mainland,
| Cost Component | Estimated Cost (AED) | Notes |
| Trade License (Commercial + Contracting) | 22,000 – 25,000 | Issued by Department of Economy & Tourism (DET) |
| Dubai Municipality Classification Fee | 10,000 – 15000 | Mandatory for contracting activities After License Issuance |
| Engineering Staff Registration | 2,000 – 5,000 | Required for Technical Manager/Engineer (SOE card) |
| MOA Notarization & Legal Drafting | 1,500 | Required legal step at Dubai Notary |
| Ejari (Office Rent) | 15,000 – 40,000+ | Office space mandatory for license |
| Initial Approval & Name Reservation | 1,000 – 1,200 | Needed to initiate licensing |
| Visa Processing (per employee) | 5000 – 7,000 | Includes medical, ID, labor processing |
| Immigration & Labour File Opening | 1,200 | For opening labor and immigration files |
| Bank Account Setup (Optional Assistance) | 0 – 3,000 | Depends on the chosen service/bank |
| Insurance & Safety Compliance | 1,500 – 3,000 | Mandatory for worker safety compliance |
Special Requirements for Setting Up a Construction Company in Dubai
- Technical Staff Appointment
To be classified and approved for construction activity, the company must hire:
- Qualified Engineer / Technical Manager
- Must hold a civil engineering degree(attested).
- Registered with the UAE Society of Engineers.
- Experience certificate (typically 3+ years) may be required.
This person is mandatory to obtain municipality classification for the company.
- Dubai Municipality Classification
Any company engaging in contracting (e.g., building, road, MEP) must be classified by Dubai Municipality.
Documents required for classification:
- Engineer’s qualifications and experience
- Trade license copy
- Ejari tenancy contract
- Passport & visa copies
- Company profile or completed projects (if any)
Without this classification, the company cannot apply for tenders or execute licensed contracting work.
- Attestation of Educational Certificates
The technical manager or engineer’s degree certificates must be:
- Attested by the home country’s Ministry of Education
- UAE Embassyin the home country
- And finally, MOFA (Ministry of Foreign Affairs – UAE)
This is a non-negotiable step for Dubai Municipality approval.
- Third-Party Liability Insurance
Before starting operations, the company must obtain:
- Contractor’s All Risk Insurance
- Worker Compensation Insurance
- Public liability coverage (especially for on-site work)
These are often required to obtain building permits and safeguard compliance.
- Activity Scope & Limitations
The company must define whether it is:
- G+1 Contracting(can only build up to 2 floors)
- G+Unlimited(requires high-level classification, multiple engineers, and advanced experience)
Higher classification allows participation in government and large-scale private tenders.
- Health & Safety Compliance
- Must adhere to Dubai Civil Defenseand Occupational Health & Safety (OHS) regulations.
- Site supervisors and staff may require safety training and certifications (like NEBOSH).
- Labour Quota and Visa Allocation
Construction companies typically request larger labour quotas for on-site workers. This may require:
- Labour accommodation approval
- Site permits from Trakhees(if working in free zones or special development areas)
- NOC or External Approvals (if applicable)
- Civil Defense, RTA, DEWA, or other authorities may need to issue NOCs for specific types of construction activities (e.g., electrical, fire safety, road works).
From Permits to Approvals: Business Link Eases Your Construction Company Setup in the UAE
Setting up a construction company in Dubai involves more than just obtaining a trade license—it requires securing multiple special permits and approvals from various authorities such as the Dubai Municipality, DEWA, Civil Defence, and others. These steps ensure the business complies with all safety, environmental, and regulatory standards before starting operations. At Business Link, we simplify this complex process by providing complete assistance—from acquiring your commercial license and G+1 permit to coordinating with government bodies for necessary approvals. Our experienced team ensures a smooth and compliant setup, saving you time, effort, and costly delays.
