Different Types Of Business Setups In UAE

Thanks to its uniquely diversified and expanding economy, and highly developed banking and financial sectors, the United Arab Emirates presents fertile ground for budding organizations. Entrepreneurs and start-ups are flocking to the country to set up businesses of the future. The government of the UAE has also aided and encouraged this migration through welcoming policies that cut down on bureaucracy, offer tax-cuts, and reduce the procedures involved in setting up a company.

Entrepreneurs and investors looking to set up a business in the UAE need to go through a simple registration process that varies according to the type of business being set up. The first step, therefore, is defining the type of company that the investor is looking to establish. Below are the four major types of business establishments that UAE’s laws allows for.

Limited Liability Company

A Limited Liability Company or an Onshore Company is the most common type of business registration in the UAE. This type of license is obtained when the purpose is for complete operating rights within the country. The license requires establishing real offices within the country and having one or more UAE residents as shareholders. The share of ownership for foreign investors in an LLC is limited to 49%.

Offshore Company

UAE offshore company incorporation allows an easy set up process for companies seeking to operate outside their country. The major organisations facilitating offshore company incorporation in the UAE are Jebel Ali Offshore Company (Dubai), RAK International Corporate Centre. Among the four types of companies listed here, an offshore company has the easiest incorporation process. It requires no license, is free of corporate taxes and can be incorporated with virtual offices.

Free Zone Company

Across the country, UAE has set up 35 free zones that offer attractive business establishment opportunities for entrepreneurs and organisations. Free Zone Companies can operate inside the UAE, though only within the free zone boundaries. Free Zone companies allow for 100% foreign ownership, 100% import and export tax exemptions and 100% repatriation of capital and profits. The licensing procedures require the establishment of a real office or a warehouse within the free zone.

Branch Office

A branch office is an extension of an international parent company and conducts business under its name. While a branch office is not allowed to import and export on its own, it can conduct other affairs of business within an established purview. These operations might need special licenses to be obtained from the Ministry of Economy. Branch offices require a UAE national to be appointed as a service agent for the branch.

If you’re looking to set up offices in the UAE, a registered company formation agency can help you navigate through the various details, procedures and licenses involved in the process.

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