Incorporation of companies in the UAE

Companies in the territory of the UAE (except for free economic zones) can be formed only with the participation of an UAE citizen who acts either as a partner holding 51% of the company shares (LLC) or as a service agent who does not own any company shares, but represents it in state institutions (a professional company). For such companies the law does not prescribe the amount of authorized capital, engagement communication is not mandatory, and commercial activities are permitted throughout the UAE.

It should be noted that some activities can be registered only in the UAE and are not subject to licensing in free economic zones (retail, restaurant business, financial and insurance activities, architectural and engineering offices, medical and cosmetological services, as well as some other activities).

Depending on the type of the company activity, there are two types of licenses:

1. Commercial license with the right to conduct trading operations and production;

2. Professional license with the right to provide services.

A distinctive feature of a commercial company in the UAE (LLC) is participation of a local partner owning 51% shares. To open a limited liability company (LLC), one must enter into an agreement with a UAE citizen on joint ownership of the company. In accordance with this agreement, 51% of the company shares should belong to the local partner. However, according to the generally accepted rule, along with the pre-incorporation contract an additional agreement should be concluded in which the local partner refuses any claims for management of the company, as well as for receiving income from its activities. In return, he receives a specified fixed annual remuneration.

If you plan to provide services in the UAE (beyond free economic zones), you just need to register a company in a free economic zone. In companies with a professional license, a foreign investor may own 100% of the company shares, but an obligatory condition for its operation is the use of services of a local service agent. He does not participate in the company activities, but represents its interests in public institutions.

Only by correctly selecting the legal organizational form, you will be able to successfully conduct commercial activities in the UAE. The process of company registration, obtaining the necessary permits and compliance with other formalities can be greatly simplified if you contact our company. Having extensive professional experience, knowledge of local laws and business environment, our consultants will help you quickly and properly register the company in various government bodies, register a trademark / brand, get certification, open a bank account and get resident visas for you and your employees. Matul Business Services will not only help you organize your business, but also provide administrative and advisory support in its formation and development.

Contact us and we will tell you how to build your business in the UAE!

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