Inquiry: Setting Up a Recruitment Firm in Abu Dhabi

Setting up a recruitment firm in Abu Dhabi involves several critical steps, including legal requirements and registration processes. Here’s a comprehensive guide:

Steps to Set Up a Recruitment Firm in Abu Dhabi

1. Choose a Business Structure:

2. Decide whether you want to establish a sole proprietorship, partnership, or a limited liability company (LLC). For foreign investors, an LLC is often preferred as it allows for local sponsorship.

3. Trade Name Registration:

4. Choose a unique trade name for your recruitment firm and get it approved by the Department of Economic Development (DED) in Abu Dhabi.

5. Obtain Initial Approval:

6. Submit your application to the DED, including key details about your business activities, to obtain initial approval to operate.

7. Prepare Legal Documents:

8. Prepare the necessary legal documents, such as the Memorandum of Association (MOA), and have them notarized if you are setting up an LLC.

9. Office Space Requirement:

10. Secure a physical office space in Abu Dhabi, as a physical office is required for legal registration. Ensure that your chosen space complies with local regulations.

11. Final Approval and Licensing:

12. After securing your office, submit the required documents and approvals to the DED for the final business license.

13. Register with the Ministry of Human Resources and Emiratisation (MoHRE):

14. For recruitment firms, you must register with MoHRE to obtain the necessary approvals to operate as a recruitment agency.

15. Obtain Relevant Permits:

16. Depending on your services, you may need additional permits from government bodies related to labor, recruiting, and professional services.

17. Open a Bank Account:

18. Once you have your business license, open a corporate bank account in Abu Dhabi to manage finances.

Legal Requirements

• Local Sponsor: For most foreign-owned businesses, partnering with a local UAE national is mandatory to satisfy the foreign ownership rule unless you set up in a free zone.
• Trade License: The cost varies based on the business size and structure, but ensure all fees are paid in full.
• Compliance with UAE Labor Laws: Familiarize yourself with local labor laws, especially pertaining to recruitment practices.

Commission Percentages in the UAE Market

• Typical Commission Rates: Commission rates in the UAE for recruitment services generally range from 15% to 25% of the candidate’s first annual salary. However, this can vary depending on sectors, with executive positions often attracting higher percentages.
• Retainer vs. Contingency: Understand the difference between retainer fees (charged upfront) and contingency fees (paid only upon successful placement) in your pricing structure.

Additional Tips

• Networking: Build relationships with local businesses to gain insights and establish credibility.
• Marketing Strategy: Develop a solid marketing strategy to attract potential clients and candidates, such as social media marketing and attending industry events.
• Compliance with Ethics: Uphold high ethical standards in recruitment practices to establish your firm’s reputation.

Setting up a recruitment agency in Abu Dhabi can be a rewarding venture, but ensure compliance with all local regulations and market norms. Good luck!