Dubai is witnessing immense growth and development in becoming a commercial hub globally due to its industrial transformation. The entire business culture has evolved due to global exposure and the government initiatives taken to promote entrepreneurial growth in the Emirate.
Civil companies in Dubai are getting extremely popular due to the increase in public-private partnerships and several government initiatives. They have contributed significantly to the diversification of the economy, making it a promising opportunity for local and international investors.
This article will examine the requirements for opening a civil company in Dubai, including the activities permitted.
Back to topWhat is a Civil Company?
A civil company is a type of non-commercial corporation which includes two or more individuals offering more than one service in recognised fields.
Larsen and Toubro (L&T) is an excellent example of a civil company as it renders services in engineering, building, manufacturing, technology, and financial services.
Back to topThings to Consider Before Setting Up a Civil Company
Here are a few pieces of necessary information that need consideration for a civil company formation in Dubai:
- A local service agent (LSA) is needed to set up a civil company. You will need to sign a service agent agreement when appointing a local agent for your company.
- The minimum number of partners in a civil company is two with the maximum being fifty.
- Each partner is jointly responsible for the company's liabilities.
- Full foreign ownership is allowed for most of the civil company activities. In case you are engaged in engineering-related activities, the LSA needs to hold 51 percent of the company shares.
- You can change your company’s business structure, considering you meet certain criteria and requirements set by the Department of Economic Development (DED).
- Setting up of multiple branches of the civil company in Dubai is allowed. Each branch can carry out one or all activities falling under the primary trade name.
- The trade name must reflect the commercial activity undertaken by the business.
Benefits of Starting a Civil Company
Let’s take a look at the benefits of civil company formation in Dubai:
Simple setup process
Company setup in Dubai is easy if you fulfil all the criteria laid down by the DED. There is no minimum capital requirement for starting your civil company in Dubai.
Multiple Visas
You can apply for and sponsor multiple visas if you set up a civil company in Dubai.
Variety of Business Activities
You can choose from a wide range of business activities for forming a civil company in Dubai. These activities include consultancy, education, healthcare, financial advisory, engineering, legal services, media and communication among others.
LSA Support
Starting your business on the Mainland requires the local agent to hold 51 percent of the company shares. The LSA has no financial ownership and only acts as an intermediary between the government and your company, if necessary.
Back to topHow to start a civil company in Dubai?
To form a civil company in Dubai, you need to follow the steps mentioned below:
Register Trade Name
Deciding the trade name plays a huge part as the name is directly aligned with the nature of services provided and helps in promoting the brand image. You need to submit the trade name application to the DED for approval and obtain the trade name certification.
Hire a local agent
Hiring a local agent is necessary to establish a civil company in Dubai. It ensures that the company complies with all the regulations and that the incorporation process goes smoothly.
Office Location
Choosing the right location for the business is necessary for the application process, as the authorities need proof of business operation being conducted.
Approval from Authorities
To obtain the initial approval, fill out the application form and attach the necessary documents such as a trade name certificate, a copy of the partner passport, the LSA, a Memorandum of Association (MoA), a service agent agreement to appoint a local agent, etc. You might need additional permits and approvals depending on the business activity from concerned authorities.
Acquire License
After complying with all the regulations laid down by the DED and paying the required fees, you will receive your civil company license. It will allow you to legally conduct your business operations in Dubai.
Establishing a company in Dubai, especially for foreign investors involves following a detailed process. Commitbiz experts can guide you with the entire business setup process by offering end-to-end business services. To know more, connect with us.
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