Mainland Dubai Company Formation
What Are Mainland Companies?
Mainland Companies are one of the most developed business entities that are directed by the Federal Law No. 2 of 2015 (the New Commercial Companies Law, (NCCL)) comes into effect 1 July 2015. The NCCL replaces the previous Commercial Companies Law (UAE Federal Law No. 8 of 1984, as amended, (CCL)). Mainland companies are regulated by the UAE legal structure and government policies and are located within the limitation of commercialized geographical areas falling under the jurisdiction of the Emirates government.
As per the mainland company incorporation law, UAE national has to mandatorily hold at least 51% of total equity in any commercial company, except in the following cases:
- Activities with 100% GCC ownership
- Businesses located in the Free Zones
- Instances where GCC companies (wholly owned) enter into a partnership with UAE national
- Where the law requires 100% local ownership
Why Setting Up Mainland Company In UAE Makes Sense?
United Arab Emirates (UAE) is one of the most popular trading environments in the Gulf and an ideal location for mainland company set up due to its strategic location (situated midway between Africa and CIS countries, and Europe and the Far East), vibrant economic policies, and positive planning.
Well-planned enterprising initiatives, various tax incentives, avoidance of double taxation, and abundance of natural resources like oil have enabled service, industry and trade sectors to flourish in the UAE, and have played a crucial role in making it a dynamic business hub.
Advantages Of Setting Up Mainland Company In United Arab Emirates
There are many advantages of mainland company incorporation in UAE, these are:
- Ease of getting office space at affordable rates with the flexibility to rent/lease office anywhere
- Flexibility to do business in any part of the UAE
- No restrictions in processing legal documents
- No yearly auditing
- No corporate or personal taxes
- No limitations in getting employment visas and easy recruiting process
- No requirement for minimum capital
- No need for the local sponsor to avail Professional Licenses
Permissible Legal Entities In Mainland Company Setup
Any investor planning to establish a mainland company in UAE can set up his / her business establishments in any of the following ways:
Branch Of Foreign Companies
- No shareholder requirement
- Foreign companies are not allowed to practice their primary business, or incorporate branches in the Mainland, or engage in trading activities unless licensed by the Ministry of Economy
- Necessary approvals and license need to be taken from the concerned authorities to practice business in Mainland
- The license mandates a national agent to act on the behalf of the company
- Type of business practiced should be stated
- Proposed business activity for a branch of foreign Company should be within the domain of the activities performed by the parent company
- These are also known as civil companies
- Minimum of 1 and a maximum of 50 shareholders are allowed
- In order to carry out professional practice in the UAE, foreign investors can set up a partnership firm / professional company
- Unlike LLC companies, there is no restriction of 51% local equity to establish professional firms
- E.g.; Consultancy firms like, Marketing consultancy, Management consultancy, etc.
Limited Liability Company (LLC)
- LLC is the most common form of business in UAE
- LLC can be established with a minimum of 2 and a maximum of 50 partners
- The percentage of individual's share in the capital decides the liability to each partner
- UAE Commercial Company Law allows foreign companies to open Branch/Representative offices without any shareholder
- Representative Offices are not allowed to perform trading or manufacturing activity and cannot even invoice as these are essentially the parent company's marketing arms
Public Shareholding Companies
- Companies performing public shareholding, financial, banking or insurance activities are known as public shareholding companies
- For a public shareholding company, the minimum capital required is US$ 2.725 million, therefore its suitable for large projects or operations
Points To Note While Setting Up Mainland Company In UAE
1. Business License Types
Three types of business licenses are permitted for mainland companies in UAE, these are:
This is not limited under new CCL: "The management of an LLC can be undertaken by one or more directors/managers as determined by the company's memorandum and articles of association or the general assembly of the company (article 83 of New CCL)."
- There can be minimum 1 director at a maximum to be defined by owners in a mainland company
- Usage of religious words and certain words like UAE and Dubai etc. is prohibited
- It is mandatory for the shareholder to be present in the UAE at least once while getting the initial approval
- Bank Accounts
- Bank accounts can be opened in any UAE's major bank
- Abu Dhabi Chamber of Commerce
- Dubai Chamber of Commerce
- Sharjah Chamber of Commerce
- Governing law
- Companies are subjected to the UAE law
- Periodic meeting of shareholders and Board meeting can be conducted in the UAE
- No taxes are levied by the government on capital gains, profits, etc.
- Visa eligibility
- Visa eligibility for the employee and dependent depends on the company type, office size, and activities performed
Documentation Formalities In Mainland Company Setup
Following documents are required to establish a mainland company in UAE:
- 1. Passport copies of the expatriate shareholders, directors & managers along with the visa page and entry stamp (when shareholders enter UAE)
- 2. If the shareholder/ manager is on employment visa of any company in UAE, a No objection certificate is required
- 3. Valid and clear passport copy and the National ID card copy of the UAE National Partner
- 1. True Copy of Certificate of Incorporation and the Memorandum and Articles of Association legalized from UAE embassy.
- 2. List of shareholders in Arabic
- 3. No objection certificate from the free zone/offshore authority if the company is a shareholder in proposed LLC
- 4. Original Board Resolution for setting up the company with Power of Attorney Notarised and legalized from the UAE embassy
Additional Documents For Professional Firms and Public Shareholding Companies:
CV and Degree Certificate Documents have to be:
- Certified as true copies by the Notary Public in the country of origin
- Legalized by the UAE Embassy in the country of origin
- Legalized by the Ministry of Foreign Affairs in UAE
Commitbiz For Mainland Company Formation In UAE
Commitbiz is a reputable company that has been facilitating mainland company incorporation for small, medium and large establishments. We assist our clients with mainland company set up in the United Arab Emirates by taking care of their business requirements from start till end.
Our Business development team believes in complete operational transparency and works towards ascertaining clients' business growth by limiting their tax liabilities and protecting their assets with free money repatriation. The willingness of our team to tread an extra mile to provide a trouble-free and customer-friendly working environment, coupled with their extensive domain expertise has helped us understand the unique needs of our clients and serve them satisfactorily. We act as the registered agent for our clients in UAE for mainland company formation, and assist them with:
- Handling bank accounts in UAE and other jurisdictions
- Taking care of administrative and accounting services
- Providing professional audit and assurance services
- Assisting in Banking, trade finance, and legal documentation
Commitbiz not only provides strategic business inputs and state-of-the-art amenities to its clients but also handles legal documentation formalities, to ensure smooth and hassle-free business incorporation process in the UAE. Contact us for your mainland company setup requirements in UAE; our team will be glad to assist you.