Entrepreneurs and free-zone operators gain from Abu Dhabi business licence changes

The new licensing system announced by Sheikh Mohammed bin Zayed drops the requirement to have an office or work space for two years

Bernard Lee, of GlassQube Coworking space, likes the proposals but wants to see the detail. Khushnum Bhandari for The National

New plans to allow home working and give companies the ability to operate outside free zones will be a boon to small businesses and entrepreneurs, experts said.

The plans are part of a Dh50 billion stimulus package for Abu Dhabi announced by Sheikh Mohammed bin Zayed, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the Armed Forces, on Tuesday.

Officials have been given 90 days to create a detailed execution plan for the package, which seeks to ease of doing business and bring lasting economic benefits to Emiratis, residents and investors.

There are 10 initiatives at the heart of the announcement, which include a new licensing system that drops the requirement to have an office or work space for two years, allowing people, officially, to work from home for the first time.

In addition, companies already operating in Abu Dhabi free zones will be offered dual licences so they can operate outside the free zones and compete for Government tenders. Experts said the announcement would significantly ease the burden on start-ups.

_______________

Read more:

Sheikh Mohammed bin Zayed announces Dh50 billion stimulus for Abu Dhabi

Why Sheikh Mohammed's new economic plans are a game changer for Abu Dhabi

_______________

In terms of "diversifying the start-up economy, it's amazing for that segment where they can now start a business legally at a fraction of the cost of what it is today and not be constrained to a free zone or have to rent an office", said Bernard Lee, the co-founder of GlassQube Coworking on Reem Island.

It will also open the door for the many home businesses that operate either under the radar illegally, selling goods from home, or under another company's licence.

Esraa Bani-Rothman, 34, a Sudanese-American, has wanted to start initiatives, including a company to promote children's literacy, but decided against it because she needed an office space, which would make it too expensive.

So, she decided to set up the initiative – known as The Reading Tree – in 2014, and operate under another company’s licence, which places constraints on her.

"I have done storytelling and programmes for children all over the city but I have always wanted to take it to the next level and turn it into a company," she said. Ms Bani-Rothman said she was able to work from home when she lived in the United States.

“I have never wanted to be confined to a space because it made no sense for the type of business that it is. I want to be able to pop up in all sorts of different places in the city.”

Once home working is allowed, she can establish her own business – along with the other ideas she has.

“I wouldn’t only start this one. I would start many of the businesses that are parked. I have so many initiatives – I call them initiatives now because I don’t have the ability to grow them. But they are sitting there. But with something like this, I wouldn’t only be able to launch this, I would be able to expand everything.”

But experts caution that there is no detail on the plans as yet.

“They have until September to explore what the official implementation is going to look like,” Mr Lee said.

“Sheikh Mohammed bin Zayed has basically mandated his team to come up with ideas.”

Steve Ashby, the founder of Businessmentals, a consultancy for freelancers and solopreneurs, agreed that more detail was needed.

“It sounds great. But it’s always good with these things to see what they are like in practice,” he said.