Understanding the Company Formation Procedure in UAE

Just like there are specific laws for the foreign investors in countries across the world; similarly, Dubai also has certain laws that are applicable for the foreign entrepreneurs. UAE offers large scopes and world class facilities to the foreign investors but in order to invest in this country, they also need to adhere to certain regulations.

As per the law of UAE; the below-mentioned entities can be established without a UAE national as the majority shareholder:

Free zone company

Professional services company

UAE branch office

UAE representative office

Offshore company

The foreign investors who want to establish their companies in the mainland of UAE can choose

 LLC company formation UAE: An LLC Company in UAE needs a minimum of 2 shareholders; one of whom should be the local sponsor. The local sponsor should be a UAE national with 51% share of the company. This type of business entity is ideal for those foreign investors who are interested in setting up business in UAE mainland.

Joint Stock Company (JSC): Joint Stock Company can be of two types:

  •  Public Joint Stock Company: This type of company requires at least 10 shareholders and 3 directors and 51% share of the company must belong to the local sponsor. Moreover, 55% of the share must be offered to the public.
  •  Private Joint Stock Company: This requires at least 3 shareholders and 51% share of the company must belong to the local sponsor. This kind of company can be engaged in industrial and large commercial activities in the country.

Apart from this, there is limited partnership entity which is ideal for investors investing in accounting or law sectors.

Individuals who are interested in LLC registration in Dubai need to follow the below-mentioned steps:

The company has to be registered with the Department of Economic Development

The company’s Memorandum and Articles of Association needs to be Drafted and notarized

The business license application form and documents have to be submitted to the Department of Economic Development

Complete the registration has to be done with the Dubai Commercial Register

Once the company is incorporated, the employees of the company should also be registered with the General Authority for Pension and Social Security and Ministry of Labor.