Company Inspections in the UAE. What You Should Know

Once your company is established, post-registration requirements are met, auditors are appointed, still one more aspect remains that you shall be aware of and this is inspections. In this chapter we will talk about those inspections, which may be conducted by various authorities and third parties with respect to your business. We will explain, why inspections are carried out, and we will help you to ensure that you always stay compliant and ready for such inspections.




    First of all, one shall understand the difference between unannounced Operations Inspections by government authorities and planned inspections by service providers.


Unannounced Operations Inspections are conducted by a free zone, if you own a free zone company, or by the inspectors affiliated to the Ministry of Labor, Social Affairs, Dubai Municipality or other authorities, in case of a local/mainland company. All inspections are conducted during working hours. If anyone comes to you with inspection, you always have a right to ask the inspector to provide his card, stating the capacity. The purpose of the visit of authority’s representatives is to ensure that business activity, which company conducts, is in line with whatever is mentioned on your company’s license. Additionally, inspections help to identify any business irregularities or violations concerning employment. As part of the inspection you may be requested to provide samples of materials used: catalogues, brochures, leaflets, business cards etc. The inspector also has the right to interrogate you, the employer, or the workers, either privately or in the presence of witnesses. You may be also requested to provide copies of documents, showing that employees are legally hired and have the right to occupy company’s premises. Sometimes you may be asked to show couple of invoices, which would again prove that you are actually operational and that you are engaged in activities, which are within the scope of your company’s license. If any violations are recorded, there may be certain penalties in addition to warnings.


Some of the inspections are industry specific. For example, if you are running a restaurant or a café or you sell personal care products, you may expect regular inspections from the Municipality. Inspectors from Food Control and Health Control Departments of Municipality conduct unannounced checks of all retail and food premises to ensure food and health safety. Another example of industry specific inspections would be Customs Inspections related to trade. Businesses involved in trade, which buy from abroad, or import in the UAE in other words, are subjects to regular inspections of imported products and goods. This ensures that the quality of imported products is in line with the local standards and there are no counterfeit goods coming inside the country, as well as. There may be other authorities involved in inspections of your products, depending on the industry you are working in.


As compared to unannounced Operations Inspections, office inspections are usually scheduled in advance. Office inspections are often required, if you do any modifications to your commercial space. Sometimes, there are standard office inspections, before you apply for the renewal of your company’s license, where inspectors check that you have re-filled fire extinguishers, that you have a complete first aid kit and emergency numbers are displayed in an easily accessible place. In order for you to pass the inspection successfully, you must make sure that you are compliant with all requirements set by the relevant authority.


At the same time, along with Operations and Office Inspections, you may be subject to an inspection by the third party. It is usually the case, when you rent a standard office (not a flexi-desk) and you want to connect internet in your office, or you want to apply for a POS machine or simply open a corporate bank account. Most of the service providers want to ensure that they will be providing service to the existing operational entity. Therefore, first they send their inspector, who will come to see the office, to make pictures of the working area, to request some brochures, leaflets, booklets and business cards. Following this visit attending inspector would prepare a report. Only after report is submitted internally and necessary due diligence is completed, relevant technician or consultant is sent to render the service.


Finally, with the roll-out of VAT in the UAE, a concept of Financial Inspection was introduced. The Federal Tax Authority in the UAE was mandated to perform a tax audit on anyone to confirm compliance with respective laws. The Federal Tax Authority shall be giving business a five-day notice prior to the inspection taking place and the audit shall be performed at a company’s office or any other place, where company conducts business, keeps goods or maintains financial records. As such, these inspections will not be unannounced and will be conducted during the authorities official working hours.


You might be wondering, what if out of some reason your office was closed, when Operations Inspection took place. In this event you will need to justify why your business was closed during standard operational hours and respective authority can accept the justification reason and attempt to inspect your office again in the coming months. Otherwise, respective authority has the right to take relevant measures. If it is a third party, which unsuccessfully conducted inspection for the purpose of providing you, for example, with corporate internet, you may contact respective service provider directly and kindly request to revisit your premises.


As you can see it, different inspections serve different purpose. While Operations Inspections ensure that you, as a company, comply with rules and regulations, and these inspections are random and unannounced, third party inspections are done for the purpose of confirming that your business exists, is in good standing and you are eligible for a certain service.


We hope you found this chapter helpful and now you have a better understanding, as to what aspects of your company’s operations shall be taken care of to ensure that your business always stays compliant and is not subjected to any penalties or charges for non-conformity. And remember our advice to keep a good track of all your documentation, both operational and financial, for any future requests from authorities.


    If you want to know more about Dubai freezone company formation, feel free to get in touch with our professional consultant team and we would be delighted to assist you and help you to compare Dubai freezone company setup costs and help you to find that free zone, which would suit your business needs the most.


 Disclaimer: Business Boutique is not affiliated with any particular government or legal entity. Business Boutique does not give professional legal advice nor any other professional advice subject to a public office in the government. This article merely sets out a simple and basic idea as to the reasons of Dubai freezone company setup and Dubai free zone company formation cost. Business Boutique in no way holds nor imposes any official governmental or legal authority and the article herein is only to be taken as a guide. All further governmental or legal issues should be addressed to the corresponding authorities.

Share this news in social networks

You may also be interested to see