The Limited Liability Company formation is the most general type of business setup in Dubai – UAE. Business setup in Dubai opens the entire UAE market and establishes a regional existence that permits access to a broader market. The process of Limited Liability Company formation is not nearly as scary as it may initially appear. There are many business consultants in Dubai who can prepare to do most of the footwork for the business Setup in Dubai. These organizations cooperate with the local authorities to get information of required documents and to make sure the company formation in Dubai moves forward in a quick and effective way. Although there are some restrictions and ownership requirements but it does not affect business operations. The list of required documents for setting up a LLC company setup in Dubai is easily managed, especially when you are getting assistance from the local Business consultants.
LLC Company Formation in Dubai
A limited liability company should have minimum of 2 and maximum of 50 partners, each partner’s liability is limited to its share capital in the company. The minimum share capital required to form a LLC company in Dubai is AED 300,000. This is the most popular form of company to do business in Dubai. (Expats/Experts) can have only 49% stake in the business as per the UAE commercial law.
Therefore the standard shareholding arrangement for a Dubai LLC formation will be:
UAE national (Local Sponsor) – 51%
Foreign Shareholder (s) – 49%
A foreign investor is able to setup a limited liability company in Dubai by sharing 51% of the company with a local sponsor (UAE National). Most of the Limited Liability companies in Dubai have started choosing a UAE local sponsor (UAE National) as a silent partner. In this partnerships of LLC Company formation, the local sponsor will be paid agreed annual sponsorship fee in return of giving the whole control of the company to the Expat. During the setup of LLC Company, they can decide the way they wish to distribute the profit or loss of the Company. In LLC company formation, it is compulsory to execute a management agreement between the expat and the UAE sponsor on the beneficial ownership of the shareholding, as well as on profit sharing of Dubai LLC Company.
For beginning the formation process, you should reserve a trade name and get initial approval from the DED (Dubai department of Economic development). For getting initial approval, you have to submit several documents.
Documents required for initial approval
Application for Dubai company formation and license, along with reserved trade name
Passport copy of the foreign investor
Copy of no-objection certificate from current sponsor if the applicants have a residence Visa.
Copy of passport of local sponsor along with family book.
Copy of Emirates ID (for UAE nationals only)
Copy of passport of proposed directors and general manager
When you get initial approval, you can step forward and apply for other certifications in different other government departments depending on the type of business activity that you are planning to do in Dubai Company Formation. You should sign the Contract of Establishment before a notary and submit it to the Dubai Department of Economic Development for the final approval. In the agreement of Dubai LLC company formation, there should be details related to the trade name of the Dubai LLC company, its primary business activities, office, office address, name of shareholders, their permanent address and nationality, place of residence, profit/loss sharing details, capital investment, complete address of the office managers and the notification method to be initiated in the office.
Documents required for final approval
A copy of initial approval issued from the DED.
A set documents submitted for initial approval
Copy of office lease agreement called Ejari, including the address of the plot
Memorandum of Association duly signed by a notary in local court.
Formalities and registration processes related to limited liability company formation is generally determined by each Emirate. There can be slight variations in the procedures however the documents to be submitted are always the same. As business advisors, we are able to assist you in making the application procedures simple and fast.
Capital Requirement for LLC Company Setup Dubai
The capital requirement law was stopped in 2009, so in Dubai a Limited Liability Company can be form without depositing a capital in the bank account or there is no requirement for Auditor Certificate. However, in some other emirates, minimum capital requirement rule is applicable and it varies from emirates to emirates to setup a LLC Company.
The manager of a Limited Liability Company would be responsible to operate the account right after the LLC Company formation in Dubai is completed. The Manager of Dubai LLC Company can be more than one (up to 5 managers) and they have all financial and administrative powers to manage the day to day activities. The shareholder of Dubai LLC Company can sell or transfer his shares to anyone.
Benefits of Limited Liability Company Formation
Permits you to do local trade and services
Most popular form of establishing a commercial company in UAE
Offers supreme access to the wider UAE economy
No minimum capital requirements
Investor getting investor visa without security deposit
Option for investor to launch branches in any emirate
No involvement or local partner in day to day business activities
Easy to open corporate bank accounts and credit facilities
Enjoy World class infrastructure
Warehouse and office facilities
More details about Dubai LLC company formation
With Dubai LLC company formation, you can conduct any industrial or commercial business activities in Dubai, but not professional activities – except few activities like banking, insurance or investment. Dubai LLC Company formation is not allowed to practice legal consultancy, accountancy and auditing of financial statements or other type of consulting service.
Dubai Limited Liability Company setup (LLC company formation in Dubai) is very flexible form of business that allows fundamentals of partnership and normal corporate structures. Dubai LLC Company must have shareholders between 2 to 50. Each shareholder of LLC Company setup Dubai is liable up to the extent of his/ her share capital in the company.
Dubai business Formation Company’s name should be the same as the Dubai trade license activity or contain the names of one or more of its shareholders. The suffix “Limited Liability Company” should be added to the company’s name. The limited liabilty company registration should appoint at least 1 and maximum 5 managers. For company setup in Dubai, managers might be selected from the shareholders. Under the Memorandum of Association (MOA) of Dubai company, the manager has full powers for management. Within this scope of his/her powers in MOA, the manager’s actions and obligations are binding to the Dubai business setup.
Shares of LLC company setup in Dubai cannot be offered to the public subscription to establish or increase capital and loans. The DED Company formation cannot issue any negotiable stocks or shares to general public. LLC company incorporation in Dubai must appoint a UAE-accredited auditor in Dubai. If death of any partners happened, his/her share in the LLC company will be transferred to heirs of the deceased. The Dubai company setup shares are not issued in the form of negotiable instruments.
All Dubai Limited Liability companies must be owned at least 51% by UAE Nationals. An expat investor can own maximum 49% (professional license allows 100%) of share capital of Dubai company. GCC nationals are allowed to own 100% share capital of LLC Company setup in Dubai but if GCC national has an expat partner then 51% of company must be owned by the Emirati shareholder. The profit & loss sharing ratio can be changed from the shareholding but at least 20% should be with the local share holder of Dubai Business setup.
What We Offer in LLC company formation in Dubai?
Getting approvals and clearances from concern departments
Preparing Memorandum of Association and other necessary documents
Arranging the local partners
Assistance on bank account Opening
Assisting to find suitable office premises
Handle other documentation work
Assisting to arrange residence visa
For more details and discussion, please feel free to contact us.
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