The Emirate of Sharjah has a lot of opportunities for new businesses and businessmen. Presence of history and culture in Sharjah appeal to the people, which makes the entrepreneurs set up their businesses here. This is not all that Sharjah offers. There is so much more you can get benefit from. Sharjah is cost-effective, has an active seaport, and is full of cultural wealth and heritage.
To register your business in Sharjah, one must decide on a corporate entity first. Public and Private Shareholding company is one of the seven legal entities permitted in Sharjah.
Public Shareholding Company in Sharjah
A public shareholding company is a company where the capital is divided into equal shares; in such companies, the shareholder's liability is limited to the number of shares. Also called a Public Joint Stock Company must have at least ten founder members, and its management should be conferred in a (BOD) Board of Directors entailing a minimum of three to a maximum of fifteen persons whose term of office may not surpass three years. The Chairman and majority of the Directors in a public joint-stock business must be a UAE national and should hold maximum, i.e. 51% shares in the industry. Banking, insurance, or financial activities are generally run as a public shareholding company.
Characteristics of a Public Shareholding Company in Sharjah
- A PJSC must have at least ten founding members.
- The management should be conferred in a board of directors consisting of a minimum of three to a maximum of fifteen people whose term of office may not surpass three years.
- The Chairman and majority of the Directors in a public joint-stock business must be a UAE national and should hold maximum, i.e. 51% shares in the company.
- The minimum capital required for setting up a shareholding company in Sharjah is AED 10 million.
- In most cases, financial, local banking, or insurance ventures must be run as a PJSC. At the same time, international companies practising the same activities can open as a branch or a representative office in Sharjah.
Private Shareholding Company in Sharjah
A Private Shareholding Company is a company incorporated by several persons, not less than three. Unlike a public joint-stock company, a private joint-stock company cannot invite the public to subscribe to its shares. The minimum share capital to form a private shareholding company is AED 2 million. The Chairman and majority of the Directors in a private shareholding company must be UAE nationals. The private shareholding company's incorporating documents must preclude the public offering of shares. Except for the preceding, all the provisions which apply to the public shareholding companies shall apply to the private shareholding companies, and the incorporation of the company shall be following the procedure and conditions followed in respect thereof except for the public subscription in the company's shares
Characteristics of a Private Shareholding Company in Sharjah
- It is mandatory to obtain approval from the Ministry of Economy to set up a private shareholding company in Sharjah
- Any industrial or commercial type of business is eligible for creating a Private Joint-Stock Company. Professional activities do not compliment this legal form.
- Shareholders/Owners of any nationality can own a private joint-stock company in Sharjah following the business regulations of the Sharjah Economic Development Department (SEDD).
- UAE nationals are to own at least the maximum, i.e. 51% of a Private Shareholding Company (Private Joint-Stock Company), and GCC nationals can hold up to 100%.
- The trade name should be pertinent to the commercial activity of the firm. Trade names must include one or more of the partners' names and annexed by the phrase "Private Shareholding Company."
- An appointed manager is mandatory as per DED business regulations for a private partnership company.
Procedure to Register a Public / Private Shareholding Company in Sharjah
- Submit the application to the Sharjah Economic Department Development (SEDD) and the Ministry of Economy for registration in the Commercial Register following the terms and conditions outlined in the Commercial Registry Act and its implementing regulations within 15 days from the date of the Minister's decision to declare the incorporation of the company
- Submit an application to the SEDD regarding the establishment of the company.
- A committee is formed by the Ministry of Economy that includes a representative of the Ministry of Economy and the SEDD, assigned with the task of submitting a recommendation for (or against) the opening a company to the head of the department.
- The head of the department gives a decision for incorporating the business.
- The decision conveyed by related documents is submitted to the Ministry of Economy for the final decision to open the joint-stock company.
- The business name of the public joint-stock company in Sharjah must be escorted by the phrase "public company," and the trade name for a private joint-stock company must be accompanied by the word "private joint-stock company."
- The company may not engage in activity until after registration in the trade registry by the appropriate governmental authority.
- Two certified copies of the company's Memorandum and Articles of Association duly authenticated
- Feasibility Study
- Two copies of the list of board members and place of birth & nationality of each of them
- Copy of Memorandum of Association and decree certified by the notary public
How can we help?
Company formation in Sharjah is a lucrative proposition, and one must select the most appropriate legal entity to represent one's business. Commitbiz offers a wide range of highly consistent business management services that can help you in the realization of your business initiatives in Sharjah. Our team of professionals specializes in company incorporation, registration, accounting, tax advisory, and bookkeeping services. If you are looking to set up a company in Sharjah or anywhere in the UAE, do contact us. We'll be glad to assist you.