Setting Up Business
Setting Up Business in the UAE
All businesses (of all types) operating in the UAE must be licensed. Licensing procedures are regulated by both the federal government and individual emirates, and requirements and regulations vary from emirate to emirate. Depending on their types, new companies are either registered with the ministries of economy/economic departments, local chambers of commerce, or free trade zones.
The primary federal legislative framework controlling commercial activities in the UAE are the Commercial Companies Law and the Trade Agencies Law. These documents can be downloaded from the website of the Ministry of Economy (www.economy.ae). Apart from that, the individual emirates have slight variations
in their requirements.
The Commercial Companies Law Recognises the Following Forms of Companies in the UAE
- Public Joint Stock Companies
- Private Joint Stock Companies
- Limited Liabilities Companies
- Limited Liability Partnerships
- Branch Offices
- Representative Offices
- Professional Firms
- Free Zone Companies and Free Zone Enterprises/Establishments
Setting Up a Company Outside of a Free Trade Zone
Any company, located outside of free trade zones and other designated areas, must have a minimum of one UAE national partner who owns at least 51 per cent of its capital; however, the partners may make an agreement to share the profits in different proportions from their share of capital. Since 2005, GCC nationals have been able to enjoy 100 per cent ownership of a company in the UAE.
Main Steps Invloved
- Submission of application and proposed company name to the relevant authority for initial approval
- Drawing of the company’s memorandum of association, notarization by a notary public
- Deposit of the required initial capital in a bank – receipt of a bank certificate
- Submission of documents to the relevant authority for approval
- Approval for the use of premises from the relevant municipality
- Filing of company documents with the relevant authority and receipt of trade licences and commercial registration certificate
- Registration with the relevant chamber of commerce and industry in the emirate
- Registration of employees with the Naturalization and Residency Department
- Registration of employees with the Ministry of Labour
- Registraton of native employees (UAE nationals) with the general authority for pensions and social security
Procedures for Setting Up a Company in a Free Trade Zone:
All types of licences issued by a free trade zone are only valid in the free zone. The establishments or companies located in free trade zones, cannot display, trade, or offer their products or services directly within the local U.A.E. market; however, they are permitted to operate outside of the U.A.E., and within the U.A.E., they may operate through an Agent, Representative, Distributor or Mother Company, with a licence issued by the relevant U.A.E. authorities and pay the applicable import customs duty (usually 5 per cent) when goods are released into the local U.A.E. market. Potential customers may visit the premises of a free zone licensee, in the free zone, for the purpose of viewing goods or seeking any consultancy service, and free zone entities may directly purchase services and products, from and within the UAE, without an agent.
Related Links
www.uaefreezones.com
