Dubai, an emerging business destination in the United Arab Emirates (UAE), is home to numerous business setups. A growing economy and easy accessibility to the neighbouring markets make it a feasible option. Access to advanced infrastructure and business-friendly initiatives rolled out by the government also attract entrepreneurs from across the world.
When it comes to setting up a business in Dubai, you can opt for a business structure among multiple options. A Limited Liability Company (LLC) is a popular choice. If you are considering Dubai for registering an LLC, this guide helps you understand every detail about an LLC in Dubai.
What is a Limited Liability Company?
A limited liability company is a legal business entity that limits the liability of shareholders to the number of shares they hold. In addition to that, it offers flexibility regarding tax management. An LLC in Dubai can be started with a minimum of two (2) and a maximum of fifty (50) shareholders.
As per the amendment in the law, most LLC setups in Dubai do not require any local sponsor. You have to appoint one to conduct certain business activities and own 51 percent of the company shares.
You can avail numerous facilities for LLC formation in Dubai such as opening a bank account, obtaining a tax identification number (TIN) and overseeing the business under its own name, among others.
Types of Licenses Required for LLC formation in Dubai?
To operate an LLC in Dubai, you have to avail a license. Some of the different types of licenses include commercial, professional and industrial.
A commercial license allows conducting trading activities while a professional license enables qualified individuals to practise in the relevant field. An industrial license allows you to manufacture and conduct industry-related business activities in Dubai.
Process of Opening an LLC in Dubai
To establish a Dubai LLC, the following process must be followed:
1. Decide Trade Name: The initial step involves selecting a trade name for the LLC. The chosen name must be unique and shouldn’t hurt any religious sentiments.
2. Finalise Business Activity: Choose the business activity which you want to conduct in Dubai.
3. Select Appropriate Jurisdiction: Determine the business jurisdiction between mainland and free zones to start the LLC.
4. Obtain Initial Approval: Fill and submit the application form to the relevant authority and obtain initial approval.
5. Documentation: Submit all the necessary documents like the Memorandum of Association (MoA) to the regulating authority.
6. Avail License: Depending on the business activity, relevant licenses and permits need to be obtained from the authorities.
Documents to Submit for Opening an LLC in Dubai
There are certain documents that you have to submit to the relevant authorities for LLC registration in Dubai. Some of these include:
- Passport copies of the investor and local sponsor
- Copy of Emirates ID
- Copy of the No Objection Certificate (NOC)
- Copy of attested tenancy contract
Benefits of LLC Formation in Dubai
You enjoy numerous benefits for starting a limited liability company in Dubai. Some of them are listed below:
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- Affordability is one aspect which every investor looks for and LLC is one of the most affordable business entities.
- The personal assets of the shareholders are protected.
- The Department of Economic Development (DED), Dubai approves a wide range of business activities to be conducted for setting up a Dubai LLC .
- With the establishment of an LLC in Dubai, you are eligible to have an investor visa enabling you to become a resident of Dubai. You can also apply for multiple visas to sponsor your family and employees.
- You can trade anywhere in the UAE and Gulf Cooperation Council (GCC) countries.
The advantages of a limited liability company in Dubai are endless. So if you are considering opening one, avail professional assistance to avoid any kind of hassle.
Business Setup Worldwide is a management consulting firm having years of experience with company formation in Dubai. Getting in touch with them will enable easing the entire company formation process.