What is the Procedure for Company Formation in Dubai
Dubai Mainland is famous for its business friendly infrastructure and facilities. Dubai mainland company formation is still the first preference by most of the establishments when establishing their business in Dubai. Company Formation in Dubai Mainland is very interesting and time consuming task; we provide best PRO services in Dubai offers the best services for Dubai Mainland company setup.
So why is mainland such a lucrative area to set up in Dubai?
Dubai Mainland is the total geographical area which is permitted by the DED (Dubai Economic Department) to all the private business entities and their representative to operate commercial business functions. These are prime locations where a foreign business owner can work, for example, international chains of food, luxury goods, car makers, etc.
As per the Business Incorporation laws of UAE in LLC company formation in Dubai, a Foreign Owner can hold only up to 49% of the business, if set up is in Mainland and a UAE national mandatorily holds 51% of total equity except in the following cases:
Requirements for Dubai Mainland Business Setup
A verified office address from Dubai Municipality is required when setting up business in Dubai. The requirement of office space for Mainland company setup in Dubai, can be varied based on the type of license the investor is looking for and it is investor’s responsibility to ensure a valid tenancy contract for an office is available at the time of applying for the license of Dubai mainland company.
There are 6 main steps involved in Dubai mainland company setup. However, there are some activities which Mainland setup requires special approval from some specific Government departments. The main 6 steps involved for company formation in mainland are:
The professional consultants at Business Link support our clients to select the most appropriate decision in business setup and guide them through complete procedures of Dubai Mainland company formation and Dubai Economic Department company registration.
What are the Types of Business Licenses Available in Dubai?
The Department of Economic Development (DED), Dubai is the main licensing authority that issues licenses for all sorts of business activities in Dubai. A major prerequisite for all business licenses is to choose the suitable license category from the following 3 categories of licenses:
Dubai Commercial License
Dubai Commercial License includes all kind of trading activities. It is a type of Limited Liability Company (LLC). As per Article 22 of the Companies Law, specifies that there should be minimum 51% shares of the UAE National. This commercial license will have a local Emirati (Dubai Local Sponsor) who will hold 51% shares in the company and for which Local Emirati will be paid annually. The local sponsor can either be an individual or a corporate sponsor.
Dubai Professional License:
It is a type of Sole Establishment or a Civil Company depends on No of investors/partners. The license holder is permitted 100% foreign ownership. In order to obtain this license a UAE national must be appointed as Local Service Agent but he will not hold any share in the company. The sponsorship fee is paid on a yearly basis.
Dubai Industrial License
For setting up a manufacturing or industrial activity
What is the Procedure for Company Formation in Dubai?
Choosing the name of the proposed company is the first step when it comes to company formation in Dubai. Every company will select a trade name before its formation. This trade name must be unique and according to rules and regulations of DED. This name has to be approved by DED (Department of Economic Department)
You must be aware of your business activity as if you are conducting trading business you need to setup a commercial license and in case of services you need to setup a professional company.
A local sponsor (Local Emirati) is required for Dubai mainland company formation (except for those with professional license where local Emirati will be act as a local service agent). Local sponsor will hold 51% shares of a company against an annual fee.
Local service agents are required in case of professional license. The UAE national will not hold any company shares in professional company.
Selecting appropriate location and making a tenancy contract is also necessary for registration of company in Dubai. You can also choose virtual office in any of the business centers but it depends on the business activity.
The next step is to prepare MOA (memorandum of association) of the new company.
License application, MOA, tenancy contract and several other documents will also be required for final submission according to the type of company and jurisdiction selected for your business.
Benefits of Company Formation in Dubai
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