How to Open an LLC in Dubai
26 March, 2015
Many business owners today want to start up a limited liability corporation when they move their business to Dubai. It offers a number of excellent benefits, including the ability to keep personal assets separate from the company liabilities. Many business owners see this as more advantageous than creating a general partnership or a sole proprietorship. In order to become a LLC, it will generally take between eight and fifteen days after filing all of the necessary paperwork.
What Does an LLC Need?
In order to form an LLC, you will need to have a minimum of two and a max of 50 shareholders. Their liability is limited to their shares. It's important to know that there is a minimum amount of capital required. This is 300,000 AED, which is currently just under $82,000. Although this does not have to be actually deposited in the bank account.
You will need to have a commercial name for conducting business activities. This name, once chosen, needs to be approved by the Licensing Department of the Dubai Economic Department. You will need to draw up a Memorandum of Association of the company, which must then be attested in the Dubai Courts by a Notary Public. The Dubai Economic Department needs to approve the company, and you need to apply for and enter the Commercial Register.
After you receive approval from the Dubai Economic Department, you will be entered into the Commercial Register. The previously mentioned Memorandum of Association will be published in the Bulletin of the Economy and Commerce Ministry. At that point, the Dubai Economic Department issues the license for the company. The last step is to register with the Chamber of Commerce and Industry of Dubai.
What Are the Benefits of an LLC?
An LLC is the most common and popular method of setting up a commercial company in Dubai. Even though there needs to be 51% of ownership from Dubai or UAE nationals, it is possible to share the profits and losses at a different ratio. The investor will receive an investor visa that is good for them and their family. Investors are able to create branches of their company, and they are able to manage the day-to-day affairs of the company without the local partner being present. Assets and capital are in the name of the company and not the local investor, even though the investor may have 51% of the company.
These are just some of the benefits of starting an LLC in the emirate of Dubai. It also happens to be relatively easy to set up the company, and there is little in the way of capital needs. Because of the low cost of starting up the LLC, it means that it's generally quite easy for mid and even small sized businesses to work in Dubai.
Help With the Setup
Even though it is easy, it can be a bit daunting for foreign entrepreneurs to understand everything they need to do. Working with a professional that can help you get through the process will make things faster and easier, and there's no chance of making an error.
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