Setting up Offshore company, Free Zone company and Mainland or Limited Liability Company (LLC) in UAE below -

UAE is the leading business hub. It offers access to a market of outstanding potential for overseas companies to plan to set up their offshore company. Among its key characteristics are:

  • A growing market – Dubai’s imports have more than doubled since 1989; regional economic growth and liberalization is set to boost demand
  • A prosperous market – strategic location at the heart of one of the world’s richest regions
  • A diversified market – wide import requirements and opportunities for suppliers of most products
  • An accessible market – served by more than 170 shipping lines and 86 airlines; An open market – no exchange controls and quotas or trade barriers
The Business Environment that UAE offers to all incoming businesses is that of a highly developed economy. The infrastructure and services match the highest international standards, facilitating efficiency, quality and service. Among the benefits are:
•   Free enterprise system
•   Highly developed transport infrastructure
•   State-of-the-art telecommunications
•   Sophisticated financial and services sector
•   Top international exhibition and conference venue
•   High quality office and residential accommodation
•   Reliable power, utilities etc
•   First class hotels, hospitals, schools, shops etc. and cosmopolitan lifestyle

Doing business in the UAE is very attractive due to the following reasons

  • No personal income and capital taxes
  • No corporate taxation
  • 100% repatriation of capital and profits
  • No currency restrictions
  • Competitive import duties (5% with many exemptions)
  • Modern efficient communication facilities
  • Abundant and inexpensive energy supply
  • Simple staff recruitment procedures
  • Competitive freight charges
  • Competitive real estate costs
  • Easy access to both sea and airports

There are no exchange controls in the UAE and its currency, the UAE Dirham, is freely convertible. The Dirham is

Linked to the US dollar, the currency by which oil prices are measured. The exchange rate has remained at Dh 3.675 = US$ 1 since 1977.

UAE Offshore Company
UAE offshore company is a legal entity established in UAE offshore financial center, being protected by specific legislation which guarantees a status of full tax exemption, except for a small yearly license fee, and generally a high level of privacy. It is an entity specifically designed to be used by non residents only.
UAE offshore company can be an extremely resilient corporate entity commonly used in intercontinental tax planning and can be amalgamated into a broad variety of business agreements. Tax augmentation, benefit (asset) protection and confidentiality are just some of the reimbursements which can be obtained by a proper application of an offshore company.
The International Business Companies (IBC) Registry allows foreign investors to register offshore companies as RAK Offshore without the need to establish a physical presence in the UAE. Companies are usually incorporated within 24 hours. Any non-resident individual or corporate entity can register a company. Many jurisdictions are considered only as tax havens. The United Arab Emirates is a real country with a real economy with a population of approximately more than 4 million. It has an established history of international trade, finance and business and today it is one of the fastest growing countries in the world with one of the highest standards of living. The choice of a suitable jurisdiction is an important decision and requires careful considerations.
Important aspects to be examined and which RAK (Ras Al Khaimah) offers may be outlined as follows.
  • The availability of a modern and flexible legislative framework
  • Simple incorporation and filing requirements
  • State of the art banking system
  • State of the art telecommunication facilities
By setting up UAE offshore company, businesses can expand their commercial activity within UAE. The Emirate of Ras Al Khaimah (RAK) has launched associate degree offshore facility. The International Business corporations (IBC) written account permits foreign investors to register offshore corporations as RAK Offshore, a division of RAK Investment Authority (RAKIA) while not the necessity to ascertain a physical presence within the UAE.
United Arab Emirate’s geographical proximity and cultural similarities makes it a prime location for businesses from countries within the Gulf and also the near East. These countries have already got sturdy business links with the United Arab Emirates. RAK Offshore is additionally seemingly to profit from the very fact that some countries within the region suffer from political unrest and/or quality protection problems.
1. No Taxation  2. Anonymity  3. Asset Protection  4. Ease of Reporting  5. Low Operating Costs and Fees
•  General Trading
•  Holding Company
•  Shipping and ship management companies
•  Investments and Joint Investments Company
•  Consulting and Advisory Services
•  Property Owning
•  International & Professional Services
•  Commission Agents Company
•  100% income & corporate tax exemption
•  100% capital and profit repatriation
•  100% ownership in Free-zones
•  No Import / Export taxes
•  No Capital Gains Tax
•  No Value-added Tax
•  No Withholding Tax
•  Proximity to global markets
The United Arab Emirates is a ‘real’ country with a ‘real economy’ with a population of roughly four million. It has a long-time history of international trade, finance and business, and nowadays it’s one of the quickest growing countries in the world with high standards of living.
•  It doesn’t get to have physical offices within the UAE
•  It may not keep it up business inside the UAE
•  It may not acquire UAE Residency Visa
•  It may have non UAE resident as director or shareholder
•  It may have UAE resident as director or shareholder
•  It may have company shareholder/corporate director
•  It doesn’t need the shareholder/director to be physically present within the UAE for incorporation
•  It may not do banking and insurance business while not special license
•  It may maintain bank accounts and deposits within the UAE or worldwide
•  It may hold shares in different UAE and worldwide corporations
Overview – UAE Free Zone Company Formation
The free trade zones are established with the particular purpose of facilitating investment. The procedures for finance within the zones are comparatively straightforward. The companies operational within the UAE free zones are treated as being off-shore or outside the UAE for legal purposes.
The free zones are appropriate for firms aspiring to use UAE as a regional producing or distribution base, with the majority of their business outside the UAE. Find out more about uses of UAE Free Zone Company. The incentives for free of charge Zone Businesses are
•  100% Foreign Ownership
•  Can be formed by only one individual
•  You can open bank account in Dubai
•  100% Secrecy maintained
•  0% Tax
•  Less Renewal Charges
•  Can be liquidated anytime
•  You can do international business
•  Can do multiple activities
•  Can hold Properties
To the potential capitalist, the UAE presents favorable business surroundings. Wonderful infrastructural facilities including skilled experience and personalized services provide UAE the edge. Client needs are met within the shortest time frame being able to enjoy the subsequent facilities.

•  Liberal labor laws.
•  No restrictions on hiring expatriates
•  100% ownership in Free Zones
•  No trade barriers or quotas
•  Easy Licensing Procedures
•  Simple Import, Export Policies

•  Strong appreciating and fully convertible currency
•  Low Inflation
•  Easy funding from International Banks
•  100% income and corporate tax exemptions
•  No Foreign exchange controls
•  100% capital and profit repatriation

The United Arab Emirates (with UAE free zone Company) has several advantages meant for modern age. Though it’s sparsely inhabited and coated in desert, its longitudinal position makes it a natural central point for liaising with financial markets in America, Europe and Asia in a very time of skyrocketing economic globalization. Its position additionally makes it a perfect hub point for an age of jet travel. And, of course, it’s vital oil deposits.
•   Issue of visit and residence visa
•   Open door policy
•   Single window clearance for permits and consents
•   Each capitalist gets personal attention
•   Cost and time savings
•   Smart roads, drain and waste material facility
•   Prepared ready of power, water and gas at competitive costs
•   Smart telecommunication facility and immediate phone and broadband affiliation
•   Capitalist breaks ground within three months of signing lease contract as against 12-18 months elsewhere
•   Wonderful native and international banks for funding project finance
•   Proximity to entire gulf and international markets
•   Cheap hotels, sports and leisure facilities

•   It may not do banking and insurance business without special license
•   It can have non UAE resident as director or shareholder
•   It must have physical offices within the UAE
•   It may acquire UAE residency Visa
•   It can have UAE resident as director or shareholder
•   It may maintain bank accounts and deposits within the United Arab Emirates
•   It may hold shares in alternative UAE and worldwide firms/companies
•   It is not duty-bound to keep up its books and records
•   It may own property within the UAE
•   It may own yachts registered within the UAE
Main Land Company Setup
UAE mainland consists of all Business Entities which are directly registered under, each emirates government (other than specific free trade zones) and its authorities with the limitation of commercialized geographical areas. These main land setups directly represent the Government policies and its legal structure towards its most developed economy.

The basic requirement for all business activity in UAE is one of the following three categories of licenses:
•  Commercial licenses covering all kinds of trading activity
•  Professional licenses covering professions, services, craftsmen and artisans
•  Industrial licenses for establishing industrial or manufacturing activity
Some categories of businesses require approval from ministries also. For example, banks and financial institutions from the Central Bank of the UAE, manufacturing from the Ministry of Finance and Industry; and pharmaceutical and medical products from the Ministry of Health, branch of foreign company from the ministry of Economy and Commerce. More detailed procedures apply to businesses engaged in oil or gas production and related industries.

51% participation by UAE nationals is the general requirement for all UAE company formations except:
•  Where the law requires 100% local ownership
•  In the Free Trade Zones where 100% foreign ownership is permitted
•  In activities open to 100% AGCC ownership
•  Where wholly owned AGCC companies enter into partnership with UAE nationals
•  In respect of foreign companies registering branches or a representative office in Dubai
•  In professional or artisan companies where 100% foreign ownership is permitted
Procedures governing the operations of foreign business interests
In practice, however, Dubai company formation procedures are similar to the general system other emirates follow, whereby foreign owned offshore companies operate in one of three ways: with a local sponsor, through partnership with a UAE national or company, or through a private limited company or public shareholding company incorporated by Ruler’s decree. Since 1984, steps have been taken to introduce a codified company law applicable throughout the UAE. Federal Law No. 8 of 1984, as amended by Federal Law No. 13 of 1988 – the “Commercial Companies Law” – and its by-laws have been issued. In broad terms the provisions of the Law are as follows: The Federal Law stipulates a total local equity of not less than 51% in any commercial company and defines seven categories of business organization which can be established in the UAE. It sets out the requirements in terms of shareholders, directors, minimum capital levels and offshore company incorporation procedures. It further lays down provisions governing conversion, merger and dissolution of companies.
Federal Law No. 8 of 1984, as amended by Federal Law No. 13 of 1988 – the Commercial Companies Law – and its by-laws govern the operations of foreign business. In broad terms the provisions of these regulations are as follows:
The Federal Law stipulates a total local equity of not less than 51% in any commercial company and defines seven categories of business organization, which can be established in the UAE. It sets out the requirements in terms of shareholders, directors, minimum capital levels and incorporation procedures. The seven categories of business organization defined by the Law are:
•  General partnership company
•  Partnership-en-commends
•  Joint venture company
•  Public shareholding company
•  Private shareholding company
•  Limited liability company (LLC)
•  Share partnership company
General partnership companies are limited to UAE nationals only. The Dubai government does not presently
encourage the establishment of partnership-en-commends and share partnership companies.
A joint venture is a contractual agreement between a foreign party and a local party licensed to engage in the desired activity. The local equity participation in the joint venture must be at least 51%, but the profit and loss distribution can be mutually agreed. Joint ventures are suitable for companies working together on specific projects.
The law stipulates that companies engaging in banking, insurance or financial activities should be run as public shareholding companies. Foreign banks, insurance and financial companies, however, can establish their presence in Dubai by opening a branch or representative office.
Shareholding companies are primarily suitable for large projects or operations, since the minimum capital required is Dh. 10 million (US$ 2.725 million) for a public company and Dh. 2 million (US$ 0.545 million) for a private shareholding company. The chairman and majority of the directors must be UAE nationals and there is less flexibility of profit distribution than is permissible in the case of limited liability companies.
A limited liability company can be formed by a minimum of two and a maximum of 50 persons whose liability is limited to their shares in the company’s capital. Most companies with expatriate partners have opted for this form of company.
In Dubai, the minimum capital is currently AED 300,000 (US$ 82,000), contributed in cash. But now it is not mandatory to show this amount deposited in bank account during registration of the company.
While foreign equity in the company may not exceed 49%, profit and loss distribution can be mutually agreed. Responsibility for the management of a limited liability company can be vested in the foreign or national partners or a third party.
The Commercial Companies Law also covers the formation and regulation of branches and representative offices of foreign companies in the UAE and stipulates that they may be 100% foreign owned, provided a local agent is appointed.
Only UAE nationals or companies 100% owned by UAE nationals may be appointed as local service agents. Local agents – also sometimes referred to as sponsors – are not involved in the operations of the company but assist in obtaining visas, labor cards, etc. and are paid a lump sum and/or a percentage of profits or turnover. In general, branches and offices of foreign commercial companies are not licensed to engage in importing activity except for re-export or in the case of products of a highly technical nature. To establish a branch or representative office in Dubai the following documents are required:
•  Company registration certificate
•  Board of directors’ resolution for establishing a branch
•  True copy of company’s memorandum / articles of association
•  Power of Attorney to the representative
•  Financial statements for the last two years
•  Local service agency agreement
•  Details of local service agent
•  Company profile