Setting up a company in the UAE can be extremely rewarding but there are many things to consider.
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[toggle title=”Where do I set-up a UAE company?” icon=”” open=”false” acc_content=”There are 7 different Emirates in the UAE, each one has the same federal structure but broadly different market conditions and legal requirements. There are two major considerations when deciding which Emirate is right for your business – the market demand (target client location) and the legal requirements. Each Emirate has differing regulatory requirements, entry costs and Trade Licence and set up fees. Even the markets in Abu Dhabi and Dubai are very different in certain sectors and it is important to research the pros and cons of each location for your business type. A business set up a company such as Plus UAE can assist at this stage.”][/toggle][/accordion]
What legal structure will be best for my UAE business set up?
There are three legal structures for foreign businesses in the UAE:
- an Establishment (owned by one person – UAE National or Foreigner with National Service agent)
- Limited Liability Company or LLC (owned by two or more people, or corporates with 51% UAE local partner)
- Branch of a foreign company (100% owned by a foreign company with UAE National Service Agent)
The rules, regulations, and fees do vary widely and will be based on the type and nature of your business. There are several entities within the government of Abu Dhabi and Dubai that issue licenses for new businesses. You will need to ascertain what type of legal form is appropriate and then investigate which authority issues that business license. A company such as Plus UAE can assist you in obtaining to correct information to prepare the correct set up to undertake the correct activities.”
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[toggle title=”Do Foreign Investors need a Local Sponsor?” icon=”” open=”false” acc_content=”If you choose to set up your business in a Free Zone, then a separate local sponsor/partner is not required – the Free Zone itself effectively becomes your local sponsor and all government liaison and property related matters will have to go through them. If you are aiming to set up an Onshore LLC (or a Branch or Establishment) then you will need to have an individual Emirati national or a 100% Emirati owned company as a partner or sponsor in order to register the business. Under UAE law, with an LLC structure, 51% of the shares need to be owned by your local Emirati partner or UAE corporate partner, however, this does not mean that the same proportion of profits must follow. An agreement with your local partner can stipulate that the majority of the profits and management control is retained by the Foreign Party owning 49%. If you choose to register the business as an Establishment, which by definition is a facility owned by one person only, then a foreign individual can own it 100% but must have a UAE national (or a UAE company) acting as a service agent for the Establishment. A Foreign Branch similarly can be owned 100% by a foreign company with a local UAE National or UAE company acting as the National Service Agent. In both cases, the Individual or the company has 100% liability for the Establishment or Branch and must show qualifications and experience in the relevant field. The sponsorship requirements and regulatory requirements differ for different license types and legal forms of business”][/toggle][/accordion]
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[toggle title=”What is the minimum Capital Required to incorporate a Company?” icon=”” open=”false” acc_content=”For Limited Liability Company it is AED 150,000 and for foreigner establishment, it is AED 100,000. Foreign branches not required any specific capital investment. It will be as of parent company. As per new changes in rules, the requirement to show paid-up capital in a UAE bank account has removed a complicated hurdle in the process.”][/toggle][/accordion]
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[toggle title=”What is a Branch?” icon=”” open=”false” acc_content=”Some companies choose to set up a Branch of their existing company in the UAE. A Branch is treated as an extension of the foreign company, which remains legally liable for their activities. The main thing to consider with a Branch here is a tax. All taxes will need to be paid in the parent company jurisdiction. As the UAE has a favorable tax environment this may lead to extra costs for the company.”][/toggle][/accordion]
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[toggle title=”Do different types of businesses require special permits or have special requirements?” icon=”” open=”false” acc_content=”Yes definitely. The different legal forms of businesses each have specific requirements. Sole proprietorships (Establishments), LLCs and Branches of local and foreign firms must all meet certain specifications before the issuance of an Initial Approval, and eventually a full Trade Licence.”][/toggle][/accordion]
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[toggle title=”How much time do I need to set up a business in the UAE?” icon=”” open=”false” acc_content=”On average, it is recommended that you allow 30 days to set up a company. This allows time to complete the paperwork, regulatory approvals and any legislation and translation of documents if the legal form is a branch or partnership with the foreign company.”][/toggle][/accordion]
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[toggle title=”Do I need to have an office in the UAE?” icon=”” open=”false” acc_content=”You can’t register a business without first having a lease on an address of some sort. In Abu Dhabi, the minimum space is 14 sqm. Space will need to be inspected for compliance. There is a new license system without a physical office. For the same, it should be an LLC, 100% UAE local establishment or GCC national establishment. The license without a physical office is limited with some activities and validity is 2 years. After that, the company needs to change the license type with a physical address. Some Free Zones offer the option of renting a flexible-desk or virtual space that you share with other small businesses. If you need physical office space, then you will have to register the company first to obtain the documents that will allow you to rent the office space. If you want to rent office space within the UAE (i.e. not within a Free Zone) then you will need a full Onshore UAE Trade License. The size of your office will broadly dictate the number of staff you can have and some activities will need specific office types and locations – for example, Retail activities will need a ground floor office with a shop front.”][/toggle][/accordion]
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[toggle title=”Does it help to have local advice when setting up my business?” icon=”” open=”false” acc_content=”Finding the right local advice can save an enormous amount of time, money and a great deal of stress. The experts at Plus UAE specialize in providing foreign investors with advice on the most efficient and profitable way to set up your business in Abu Dhabi.“][/toggle][/accordion]
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[toggle title=”What is the next step to setting up my business in the UAE?” icon=”” open=”false” acc_content=”connect to plus UAE & Step to Success | marketing@plusuae.com | Tel: +971 2 491 90 50“][/toggle]
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