This document provides information about registering a business in Dubai, United Arab Emirates. It outlines the various options available, which include registering in a free zone for tax-free status and 100% foreign ownership, establishing an offshore company using a local service agent, forming a limited liability company requiring 51% ownership by a UAE national, setting up a professional firm with no restrictions, opening a branch or representative office of a foreign company, or operating a sole establishment owned by a UAE national. Dubai offers attractive benefits for businesses like no taxes, full profit repatriation, easy business regulations and permits, and a strategic location and infrastructure that has made it a major global business and tourism hub.
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Many entrepreneurs afraid from investing in the UAE; due to the rule of having a UAE national as a partner with 51% shares owned by them. For this reason, free zones have become an admire region; where people are searching how to start a business in UAE free zone because of 100% foreign ownership is permitted. A free zone, or free trade zone, is a region with particular tax-free status and little trade barriers where commodities can be manufactured, imported and exported, handled or reconfigured without paying any customs duty. Free trade zones are normally situated in strategic geographical locations like national borders, international airports as well as major seaports, to make the most of trading compensation.
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2. Dubai. The tourism, trading, commercial and
transport hub that connects the world.
3. โข From a timeless desert, Dubai has been
transformed into one of the most cosmopolitan
cities in the world. Known for its tallest buildings
with unique infrastructures, largest mall, high end
boutiques, fine dining restaurants and home to
more than 190 nationalities with diverse and
different cultures, Dubai certainly is making
global recognition and continues to attract
tourists and businesses worldwide by converging
in one common goal, living and working in this
place they call Haven.
4. Being one of the greatest business capital, Dubaiโs
success continue to inspire people, making it one of
the most preferred destinations for global
expatriates which now stands at more than two
million. It is the choice for local and international
organizations because of its strategic
location, world class infrastructures, diversified and
easily accessible market offering low logistics and
operational cost. Doing business in Dubai also
offers the following advantages.
5. 1. No personal income and capital taxes
2. No corporate taxation
3. 100% repatriation of capital and profits
4. No currency restrictions
5. Competitive import duties
6. 6.
7.
8.
9.
10.
11.
12.
Modern efficient communication facilities
Abundant and inexpensive energy supply
Simple and efficient recruitment procedures
Competitive freight charges
Competitive real estate costs
Easy access to both seaports and airports
100% ownership in Free Zones
7. 13. Availability of skilled and experienced
workforce
14. High level of administrative support
15. Dubai also offers different options in
registering a company at the convenience of the
shareholder or of the organization. They can
choose from any of the following:
8. A. FREE ZONES
โข Dubai was the first emirate to pioneer the free
zone model and offers foreign businesses
attractive concessions and a number of
investment incentives. If the target market is
outside of UAE, and you require an office
space and a UAE residence visa, then
registering a Free Zone Company or
Establishment is recommended.
9. The procedure and the cost for incorporating
the company depend on the Free Zones you
choose and the type of your activity. A Free
Zone company will be restricted to do direct
business with the UAE Local Market.
However, direct business with Local Market can
be made through a Distributer with 5 % duty
applicable.
10. There is no restriction for a Free Zone company
to do Business outside UAE and within the Free
Zone. In a Free Zone, you can start the company
as a Free Zone Establishment (single
owner), Free Zone Company (maximum 5
shareholders) or Branch of your existing foreign
company. The features of Free Zone companies
are:
11. โข
โข
โข
โข
โข
โข
100% foreign ownership
No local participation needed
100% import-export duty exemption
Bank Account in Dubai/UAE
Resident visas available
Local trading by paying 5% duty (through a
distributor)
โข 100% tax free
12. Free Zone Areas are in Dubai Silicon Oasis, Dubai
International Financial Center (DIFC), Internet
City Free Zone, Dubai Media City Free
Zone, Jebel Ali Free Zone, Knowledge Village
Free Zone, Dubai Airport Free Zone, RAK Free
Trade Zone.
13. B.
OFFSHORE COMPANY
Examples of Professional Firms are Management
Consultancy and Marketing Consultancy. There
is no 51% local equity restriction like the LLC.
Qualified foreign investors can set up this kind of
main land company. Professional Firms has the
following details:.
14. โข Appointment of a UAE national as your local
service agent.
โข The local service agent will have no direct
involvement in the business.
โข Local service agents are paid a lump sum or a
percentage of profits or on turnover.
โข Allowed to do non-commercial activity.
15. C.
LIMITED LIABILITY COMPANY
(LLC)
A limited liability company is formed with a
minimum of 2 shareholders and a maximum of
50 whose liability is limited to their share in the
businessesโ capital. While foreign equity in the
company may not exceed 49%, profit and loss
distribution can be delegated.
16. โข LLC Companies offers a UAE Visa, an office
space and business within UAE and
International market. This type of company
can be formed with 51% ownership of a UAE
national and 49% with the foreign national.
The UAE national is paid a lump sum fee
yearly which depends upon his profile and
status.
17. However, complete managerial powers is vested
with the foreign national and the UAE nationalโs
role in the operation of the company is very
limited. LLC companies have the following
features:
18. โข 100% tax free
โข Get local presence in UAE
โข Liability is limited to the company and not to
the share holders
โข Advantages on bid with local companies
โข Can setup branches all over UAE in future
19. 100% tax free
Get local presence in UAE
Liability is limited to the company and not to the
share holders
Advantages on bid with local companies
Can setup branches all over UAE in future
20. D. PROFESSIONAL FIRMS
Examples of Professional Firms are Management
Consultancy and Marketing Consultancy. There
is no 51% local equity restriction like the
LLC. Qualified foreign investors can set up this
kind of main land company. Professional Firms
has the following details:.
21. โข Appointment of a UAE national as your local
service agent.
โข The local service agent will have no direct
involvement in the business.
โข Local service agents are paid a lump sum or a
percentage of profits or on turnover.
โข Allowed to do non-commercial activity.
22. E. BRANCH OR REPRESENTATIVE
OFFICE OF FOREIGN COMPANY
โข The following are the features of Branch or
Representative Office:
โข Branch office is permitted to exercise the
activities (Licensed) of its parent entity
โข Also, it empowers to undertake transactions
and offer services to customers
โข Representative offices are only allowed to
have promotional activities supplementing the
business activity of parent company
23. โข Representative office cannot enter into
business transactions or market products
โข Additional license is required in some cases
for the Branch of foreign company from
Ministry of Economy
โข Appointment of local service agent
24. โข The Local Service Agent is:
โข Not responsible to undertake any financial
obligations and commitments as a result of
the operation of the Branch or Representative
office
โข He should not interfere in the matters related
to the Branch or representative officeโs
management or activities
25. โข His duties towards the Branch or
Representative Office are as requested by the
principal (E.g; getting approvals and permits
from government authorities)
โข He is remunerated on a lump sum basis as
agreed between the parties.
26. F. SOLE ESTABLISHMENT
A sole proprietorship can only be owned by an
individual of any nationality, and not a
Company. He will have 100% ownership and
control of all its operations and profits. He will
also be responsible for all the business debts
and other financial obligations.
27. A sole establishment, on the other hand, that is
commercial and industrial can only be owned by
a UAE or GCC National.
28. โข Dubai, being the Middle Eastโs number one
business tourism destination is a great
business capital inspiring and attracting both
international SMEโs and worldwide
corporations all over the world to establish
themselves in Dubai and be part of the
growing economy globally.
29. โข Dubai is just about everything that is known to
be the best.