Dubai is one of the famous business hubs and largest financial centers in the world. Dubai is a rapidly developing city in comparison to other middle east cities. The company registration procedure in Dubai is uncomplicated and easy. But it’s required to know and understand all the procedure steps according to the law.
Company Registration In Dubai
Dubai is the prominent largest city or state in the UAE that allows foreign investors to set up their business in dubai. The Middle East has large extensive oil exporters in the world, apart from this, Dubai has developed the opportunities to ensure that there is regular development. There is no direct and indirect tax on living in dubai.
There is a special allotted area which is known as Dubai International Financial Centre (DIFC), not in dubai but also throughout the middle east. This area brings out the different forms of registration activities relevant to compliance.
When we come to foreign ownership company in DIFC, there is no form that restricts foreign ownership in the company. Foreign businesses can have full ownership when the director and stakeholder of the company have registered in Dubai. As per commercial company federal law No. 2 of 2015. Outside Company jurisdiction has to obey the requirements of foreign investment. It means the company’s 51% ownership will be under resident of UAE.
With the company reference, the ownership aspect would be categorized on the basis of citizenship. It has a proper legal form which means 51% of the company is controlled by the local person. In 2008 from various sectors these investment restrictions were removed.
When we talk about taxation points, There is indirect VAT (value added tax) with a 5% rate imposed. In Dubai, there is no tax that is applied to the employees. In Dubai only a 5% rate is applied on the product and service. These are the best employees working in Dubai that attract the foreign company registration in dubai.
Main Regulatory Authority For Company Registration In Dubai.
Its Registrar of the company and registrar can act as a unit of the authority to bring out different forms of compliance and registrations related to companies. Applicants of company registration can be the registrar of Companies.
Area Related Company Formation.
There are two types of areas inside DIFC and outside DIFC.
- Outside DIFC - Companies may be incorporated outside the DIFC. As per Federal commercial company law No. 2 of 2015. A company that is outside the jurisdiction of the DIFC has to comply with the requirements of foreign investment. The company 51% is controlled by the UAE people. This includes the legal form to declare that 51% of the company will be controlled by the UAE nation. The restriction on foreign investment has been removed from several different sectors.
- Inside DIFC - It’s the best suitable option for investors to determine company formation. This area has different benefits which include the company registration process. In this area, there is no restriction for foreign ownership in the company. Foreign shareholders and directors can control the 100% ownership inside the DIFC.
Advantages Of Doing Business In Dubai.
- Low taxes - In the UAE corporates are not the subject of the tax. There are no income taxes for all UAE residents. There is only VAT with a very low rate of 5%. Except for oil and gas companies and foreign banks.
- Dubai is the favorite location for business owners due to low taxes and lots of benefits. Business formation in the UAE allows businesses to easily and comfortably access the GCC countries, Asian Market, Africa, and Europe.
- 100% Ownerships - In the DIFC area, the UAE government allows 100% ownership for company registration. Shareholders and investors also have 100% equity shares.
- Rules and Regulation - There are no hard rules and regulations to run a business in dubai. Business can be run easily.
Disadvantages of Doing Business In Dubai.
- Local sponsor - To register a business in the UAE you need a trusted UAE nation sponsor. And the company 51% is controlled by the UAE nation.
- Compliance Requirement - Every emirate has its own rules and regulations. UAE registered companies have to comply with the nation and emirates rules and regulations. If you register a business in the mainland then you have to follow mainland rules and regulations.
- In 2020 UAE introduced new rules and regulations for mainland registered businesses. UBO (Ultimate Beneficial Owner), shareholders, and directors new rules.
Business Registration Process In Dubai.
- Have to find a local sponsor which is mandatory to satisfy the Federal Commercial Companies Law No. 2 of 2015 (Companies Law). The company is controlled 51% by the UAE nation if you are establishing your business outside the DICF area. If you want to set up your business inside DIFC then you don’t need a local sponsor. But finding local sponsors will be beneficial and after some time you can transfer the company.
- You have to go to the Department of Economic Development to reserve your business name and also pay the name reservation fee.
- Draft the article of association of the Company and draft the memorandum of association. The document will deal with the AOA and AOA will be downloaded from the company registry.
- After drafting, submit the drafting with required documents to the Companies Registry and the Department of Economic Development.
- Under the company registry, you will receive the incorporation certificate to carry out recommended activities. Now you have to select the license which is important to carry out business. Following license in Dubai
- Professional licenses, includes services, craftsmen, professions, and artisans.
- Industrial licenses, includes industrial or manufacturing.
Required Documents For Company Registration In Dubai.
- NOC from the Sponsor.
- Business Plan.
- Application form of the Business.
- MOA and AOA which is duly notarized by the authority.
- Passports of the Managers of the Business.
- Bank Reference Letter for Each Shareholder.
- Passport of the Sponsor to prove that he/she is a UAE National.
Required document for the industry license apart from above.
- Copy of the Feasibility Study
- Information related to the Investor
- Existing Company Profile
Required Documents for Branch
- Copy which is attested related to the Certificate of Incorporation, MOA, and AOA.
- Passport Copy and Original Power of Attorney.
- Board Resolution of the Company.
- Three months bank statement related to the parent company.
LLC Company Formation Fee in Dubai.
Company Investors Visa LLC Cost without medical health insurance.
Employee Visa LLC Company Cost.
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