Limited Partnership in Ras Al Khaimah

Ras Al Khaimah, or RAK, has witnessed a significant rise in entrepreneurial activities. The Emirate is committed to welcoming various business sectors, industries and entities. A Limited Partnership (LP) is a business entity that has become popular for many businesses. It combines the benefits of a partnership and a company, offering limited liability to the partners along with operational flexibility.

In this article, we look at what a limited partnership is, the requirements, benefits and the process involved in setting up a limited partnership in Ras Al Khaimah. 

What is a Limited Partnership?

A limited partnership is formed between a minimum of two partners i.e., a general partner and a limited partner. The entity allows for varying levels of involvement and expertise among partners, facilitates the management and distribution of assets, and is ideal for real estate investments.

Features of a Limited Partnership in Ras Al Khaimah

Before setting up a limited partnership in Ras Al Khaimah, you need to know its features. Let us take a look at them-

i) The limited partners contribute money or assets to share in the partnership’s profit and loss. Whereas, the general partners are responsible for the day-to-day activities of the business with unlimited liability.

ii) You and your partners must share the profits equally or in an agreed-upon ratio as per the partnership agreement.

iii) Individuals or companies have access to partner’s associates.

iv) A limited partnership is recognised as an independent entity. This means your business can own properties, bear responsibilities in its own name, negotiate, and litigate.

v) There is no minimum capital contribution or concept of shares.

Benefits of Establishing a Limited Partnership in Ras Al Khaimah

Some of the benefits you can access for setting up a limited partnership in Ras Al Khaimah are listed below – 

a) The partnership offers protection to all the partners. 

b) The partners enjoy freedom with regard to the management structure and profit distribution. 

c) The registration process involves fewer legal regulations, registering the partnership agreement and obtaining necessary licenses.

d) Limited partnerships in RAK provide easy access to the UAE market and opportunities for business expansion due to factors like strategic location, transportation, and logistics infrastructure.

Documents Required for Opening a Limited Partnership

For business setup in Ras Al Khaimah, the following documents are required to be submitted to the relevant authorities –

  • Passport copies of all involved partners.
  • Visa details for expatriates.
  • Original rent contract.
  • Copy of the Managing Director’s passport.
  • Approval from governmental bodies.
  • Copy of the Emirates ID card (applicable for partners of UAE national).
  • Proof of capital through a letter from a bank or account statements from an authorised auditor, as requested by the department. 
  • No objection certificate (NOC) for expatriate partners authorised by the Chamber of Commerce. 
  • A copy of property ownership after obtaining approval from the inspection division at the RAK Department of Economic Development.
  • Certification of partnership contract by the notary public present at the DED.
  • Certification of partnership contract by the Ministry of Economy. 

Steps to Set Up a Limited Partnership in RAK

In order to establish an LP in Ras Al Khaimah, you need to follow a detailed process. Let’s take a look at the process to ensure a hassle-free experience - 

Step 1 - Choose an appropriate business activity.

Step 2 - Register a suitable trade name for your business and obtain approval from the authorities by adhering to the legal requirements.

Step 3 - You need to apply for initial approvals from relevant authorities.

Step 4 - Submit necessary documents to the authorities at Ras Al Khaimah Department of Economic Development.

Step 5 - Finalise an office space to conduct business operations.

Step 6 - Apply for the relevant business license that complements the chosen business activity.

Step 7 - Make payments of the requisite fees.

Once the above steps are completed, the authorities shall review the application and issue an incorporation certificate.

A limited partnership in Ras Al Khaimah offers a unique and attractive business structure for entrepreneurs like you. It is a balanced combination of active and silent partners providing flexibility and liability protection. The benefits and favourable factors of RAK make LP an ideal entity with the potential for profitability and scope.

Connect with Commitbiz as we can help you complete the setup procedure in no time. We ensure to offer top-quality services and help in any business-related activities. Book a call with us and build your dream business today!

FAQs

Are limited partnerships required to disclose financial information publicly in RAK?

Limited partnerships in RAK are not obligated to disclose financial information publicly, thereby providing privacy and confidentiality to all business partners.

Are there any restrictions on the types of businesses operating as limited partnerships in RAK?

While RAK welcomes a variety of business activities, certain sectors may require special licenses or approvals.

Are there any requirements for appointing auditors for a limited partnership in RAK?

Limited partnerships may be required to appoint auditors to conduct annual financial audits, depending on factors such as the nature of the business and the partnership agreement.

Is it possible for a limited partnership in RAK to change its business activity after registration?

Limited partnerships may modify their business activities after registration, but such changes may require amendments to the partnership agreement and approvals from relevant authorities.

What role does the registered agent play in operating a limited partnership in RAK?

The registered agent is the partnership's legal representative and facilitates communication with regulatory authorities. They may also assist with administrative tasks, compliance matters, and liaising with legal advisors.