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Guide on Opening a Dubai Company

Updated on Tuesday 19th April 2016

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Offshore or On-Shore Company in Dubai?

The procedure for opening an offshore company in Dubai differs very much from the one necessary for incorporating an on-shore company. If you're not sure at this stage which one you need please consider the following:

1) a) an offshore company (RAK Offshore for instance) does not have any special requirements or limitations regarding the owners/shareholders of the company while

b) an Onshore Company does not allow full foreign ownership (the company requires a local "Sponsor". For more info on requirements please see: Incorporation of an UAE Onshore Company.

2) a) an UAE offshore company pays 0% corporate tax while

    b) an Onshore Company has tax obligations and filling requirements per the legislation of the UAE.

3) a) an offshore company cannot activate within the UAE.

     b) an Onshore Company is designed to do business in the Emirates.

To summarize: if you are not interested in in the Dubai market (your clients are not located within Dubai) and your solely starting your company to take advantage of the tax regime, privacy and/or offshore banking then it is advisable to start an offshore company rather than an onshore one.

Starting a business in another country requires a thorough research and most of the times appealing to the services of professionals. The company incorporation procedure in Dubai resembles the procedures in most European countries provided that the foreign investors have acquired all the information about the business activity they will undertake and know all the business licensing requirements.

How easy is it to register a company in Dubai?

In most cases, the Dubai Company Act requires a foreign investor to have a local partner who will own the majority interest. The only places investors may incorporate fully foreign owned companies are the Dubai free zones. The company registration requirements will be different from case to case because of the type of company one chooses to open in Dubai. According to the Company Law, investors may set up the following types of companies in Dubai:

  • - limited liability companies,
  • - private and public joint stock companies,
  • - partnerships,
  • branch offices,
  • - subsidiaries,
  • - free zone limited liability companies,
  • - free zone establishments.

For those seeking a simpler form of doing business in Dubai, the sole proprietorship could be an appropriate choice. Depending on the selected type of company and licensing requirements, the registration procedure with the Dubai Companies Registration Office will take several days.

What are the requirements to open a company in Dubai?

When setting up a company in Dubai, foreign investors must take into account the following:

  • - the minimum share capital requirements,
  • - the shareholding structure,
  • - the business licensing requirements.

The Commercial Law does not require Dubai limited liability companies to deposit a minimum share capital before registration, therefore the shareholders will decide the amount they need to help them reach their goals. For joint stock companies, there are different share capital requirements depending on the business they will undertake:

  • - public companies will require a minimum share capital of 10 million AED,
  • - insurance and investment companies will require a minimum share capital of 25 million AED,
  • - financial institutions require a minimum share capital of 40 million AED.

The Dubai Chamber of Commerce and Industry (DCCI) issues the following types of business licenses:

Our  company formation agents in Dubai will help foreign entrepreneurs with the business license applications.

Are there other requirements to open a company in Dubai?

Other requirements for establishing a company in Dubai are:

  • - drafting and notarizing the company’s memorandum and articles of association,
  • opening a corporate bank account,
  • - registering native workers with the Ministry of Labor,
  • - registering native workers with the social security authorities.

Companies are not required to register for VAT in Dubai as such tax is not imposed yet.

Whenever you want to open a company in Dubai, you may contact our company formation representatives who can help you incorporate companies in other countries, such as: Japan, Hong-Kong and Singapore.

We invite you to watch a short video about how you can start a business in Dubai:

If you come to Dubai for business and you also need dental services, we can recommend you a modern dental clinic that is part of our network that includes another clinic in Mexico.  

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