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business setup in Dubai

Business Setup in Dubai: Mainland, Free Zone and Offshore

There are three main business jurisdictions in the UAE: the Mainland, Free zones, and Offshore. Investors can select the appropriate business jurisdictions based on their needs. However, for a successful business setup in Dubai, investors must know well all these kinds of business.

In this article, you will learn everything about how to have a successful business setup in Dubai with any of these business jurisdictions.  The three business jurisdictions of the UAE are distinct, each with its own set of advantages and benefits for investors. Let us observe:

  • A company from the UAE’s Mainland
  • What is a free zone company setup like?
  • What are offshore companies?
  • How can Connect Group help you?

A Company from the UAE’s Mainland

The majority of Mainland companies in the UAE are registered as Limited Liability Companies. The professional license category, also known as a Civil Company, is the next most common company type in the UAE’s mainland. There are other Semi-Government Public and Private Joint-Stock Companies on the Mainland.

The Licensing Authority for registering a Limited Liability or Civil Work Company in Dubai is the Department of Economic Development. Global investors can select from a variety of business license types and activities to establish a company in the UAE.

Additionally, nearly 122 business sectors are on the list of those that permit 100% ex-pat ownership with no minimum share capital requirements. Without the need for a local sponsor, a foreign ex-pat can register a company on the Mainland.

There are numerous benefits for investors in establishing a company on the UAE’s Mainland. It is an excellent choice for large-scale commercial and industrial buildings, as well as retail establishments. One of the major business license categories on the Mainland is the Service License or Professional License.

100% Foreign Ownership for Mainland Businesses

The recent cabinet decision allows expatriates to own their companies outright and eliminates the need for local sponsors or service agents. The majority of business activities on the Dubai Mainland are owned entirely by foreign investors.

Foreign investors can obtain a trade license by engaging in business activities such as:

  • Consulting
  • Commercial
  • Industrial
  • eCommerce

Hence, the process of forming a Mainland company is simple and quick.

Key Highlights of Mainland Company Formation

Depending on the business activity and type of company, Mainland company registration may necessitate certain pre-approvals. Then, it will allow the company to trade throughout the UAE, GCC, and beyond.

Mainland businesses have complete freedom in carrying out a wide range of business activities, including those in the industrial, commercial, and professional sectors.

Investors can do the following without difficulty:

  • Renting office space
  • Retailing shops and showrooms in the UAE
  • Conducting business in the UAE and the rest of the GCC region

Obtaining a UAE Residence Visa, sponsoring employees, and opening a corporate bank account in UAE is easier with a Mainland license. This is because the company has a physical address in UAE. Also, Our agency can help you in your business setup in Dubai Mainland, as well in Abu Dhabi Mainland and Sharjah Mainland.

Strategic industry pre-approvals

When compared to offshore companies, Mainland business setup is relatively simple. The offshore company will need a pre-approval depending on the business activity chosen to obtain a business license.

In contrast, the Mainland company registration process is instant when the company is engaged in:

  • Healthcare
  • Manufacturing
  • Other strategic business activities

 Hence the company license can be issued within hours.

Professional license from the UAE Mainland – How to Start a Civil Work Company?

You can register a Civil Work Company with the DED, Dubai, under the professional license category. Civil Work Company allows professionals to bid on government orders and tenders.

The steps for establishing a civil work company in Dubai are as follows. Civil work companies assist professionals in establishing their business ventures on Dubai’s mainland. Connect Group will assist you in establishing a Civil Company in the UAE.

Our team of expert Mainland Company Formation Consultants will guide you through the entire process. Also, they will handle all related activities to ensure you obtain the Civil Work Company License at the lowest possible cost. Thus, our team will assist you in the following areas:

  • Choosing a trading name and obtaining pre-approval for the Civil Company.
  • Completing the Application form and submitting the shareholder information to the DED.
  • Preparing the office space’s Tenancy Agreement.
  • Preparing the Local Service Agent Agreement and Appointing an LSA for the Civil Company
  • Making the necessary fee payment for the Professional License.
  • Obtaining and delivering the investor’s Professional License
  • Applying for the investor visa and coordinating the opening of the company’s bank account
  • In a nutshell, the Professional License from the UAE Mainland is one of the most popular business license categories. This is among foreign investors looking to expand their business network in the UAE.

What is a Free Zone Company Setup Like?

Free Zone companies benefit from 100 percent foreign ownership, tax-free status, and no import/export duties. There is also a VAT exemption for free zone designation, and investors have access to world-class business infrastructure and amenities.

Free Zones provide a low-cost business setup in Dubai without the need for a local partner or agent. It has fully furnished office space, readymade warehouses, and light manufacturing units for investors to use.

Additionally, a free zone company’s shareholders, directors, and employees are eligible for a UAE residence visa. Keep in mind that in Connect Group, we offer visa services.

Business Advantages of the Free Zones

Simple setup

In most free zones, the setup process is extremely simple. The exact application process will vary depending on your business activity and Free zone of choice. However, in many cases, you will only need to provide some basic requirements for setting up your company, such as passport copies and business paperwork.

Typically, the entire process takes only a week or two. Many free zones also provide Flexi-desk and virtual packages. Those allow you to use the Free Zone address and facilities on an as-needed basis.

Simplicity is greatly attractive for investors around the world. Also, they always look to save time. Thus, a free zone company setup in Dubai is a great option for them. Additionally, if you are an investor, you will not be alone in the process.

Tax and Duty

The tax regime is perhaps the most compelling reason to choose a free zone. If you set up your business in an FZ, you will benefit from 0% corporate and personal tax. Nevertheless, you will also be exempt from VAT, which is currently set at 5%.

But that is not all. Businesses in free zones are also exempt from import and export taxes and have no currency restrictions. You can contact us to know more about our tax consultancy services.

Trading within the UAE

Although Free zone businesses are not permitted to trade directly with the UAE’s local market, this is easily overcome. Working with a locally appointed distributor who can market your goods and services for a fee is one option. Alternatively, you can establish your free zone business and then later open branch offices throughout the Emirates.

These branch offices can be used to market your product or service and conduct business on the UAE mainland.

Foreign Ownership is Prevalent

Another significant advantage of establishing a business in a free zone is foreign company ownership. Most foreign entrepreneurs who want to set up shop on the UAE Mainland must collaborate with a local partner.

This is not the case in the UAE’s free zones. If you establish a business here, you will retain complete ownership. This is, without any doubt, a great advantage for foreigners. If you were worried about sharing before, now you can come and start with your business setup in Dubai.

Help and Assistance

The Free zone authorities are available to help with setup and beyond. Most free zones assist shareholders and any applicable dependents, such as spouses or domestic staff, in applying for visas. Many will also assist you in:

  • Opening corporate bank accounts
  • Advise you on the best bank to meet your needs
  • And even arranging in-branch meetings for you

In terms of ongoing business support, it is not uncommon for free zones to provide business advice and networking services. They also provide access to startup hubs and growth initiatives to assist new businesses in getting started.

Privacy Safeguards

Finally, free zones are especially popular with privacy-conscious entrepreneurs. This is because there is no open directory of company ownership, and company information such as shareholder details is never disclosed to the public.

One of the most important things for a businessperson is to keep their privacy. And the fact that free zones offer you that advantage only makes them more desirable. 

What are Offshore Companies?

Offshore companies are registered with a business center’s offshore jurisdictions. The offshore jurisdictions in the UAE are RAKICC, Ajman, and Jafza. Offshore companies are not subject to the legal and business regimes of the UAE Mainland or the UAE Free Zone Authority.

Offshore companies are also exempt from VAT (Value-Added-Tax) in the UAE. This is because they are deemed to be outside of the UAE and do not have an onshore/resident status. Companies are unable to open office spaces in the UAE or apply for UAE Residence Visas for their employees.

Thus, it is an excellent choice for investors who want to engage in international trading.

RAKICC Stands for Ras Al Khaimah International Corporate Center

RAKICC is one of the UAE’s most popular offshore business centers. The following are the main highlights of RAKICC Offshore:

  • 100 percent foreign ownership and owner confidentiality. This means there will not be public documentation, no audit reports for renewals, and no share capital requirements.
  • Strong offshore infrastructure and a simple company formation process.
  • With the virtual license obtained, you will be able to buy and own properties in the UAE.
  • You will be able to direct your business from anywhere in the world.

It is an excellent choice for businesses considering international market expansion. Besides, offshore companies are popular among foreign investors due to their tax-free status. And of course, Connect Group can help you.

Offshore Jebel Ali Free Zone Authority (JAFZA)

The Jebel Ali Free Zone Authority governs JAFZA Offshore. Offshore companies listed with JAFZA will have direct access to one of the world’s largest shipping ports, making global trade easier.

Highlights of JAFZA Offshore

Some factors entice investors to establish an offshore company in JAFZA, such as the:

  • Exemption from taxation.
  • Absence of personal and corporate tax.
  • Absence of import-export duties, currency restrictions.

There are numerous business advantages to forming a JAFZA offshore company, such as:

  • No minimum capital requirement.
  • Mandatory appointment of directors and secretaries.
  • Annual reporting requirements.

After receiving pre-approval from the developer and Free Zone authorities, offshore companies in JAFZA can purchase real estate in Dubai. Similarly, by investing in company shares, offshore companies can become owners of Mainland and Free Zone companies.

Offshore Ajman

Ajman is another option for offshore company formation. With a relatively low price, it is an excellent option for the investor.

Keep in mind that Ajman Offshore is the most affordable offshore business jurisdiction in the UAE. The companies can conduct business outside of the UAE and can buy property in the emirate of Ajman.

To register an offshore company, a shareholder and director must be present, and the company must be present. There is no minimum share capital requirement in Ajman Offshore.

Hence, an offshore company is a great option for businessmen around the world who want to save money. Moreover, Ajman Offshore is attractive for investors.

How can Connect Group Help You?

Now you know the main characteristics of each one of these business jurisdictions. Hence, the following step is deciding which one suits your business needs. When you do, you will need to start with the paperwork process. And there is where we can come in to make the process easier.

In Connect Group, we are specialists in company formation with more than 20 years in the market. Thus, your business setup in Dubai will be successful since we are going to handle all the paperwork. In addition to this, we will be with you in the entire process. As a result, you will be stress-free, which will be great for your health.

Would you like to contact Connect Group to obtain more information on how to have a successful business setup in Dubai in any of these business jurisdictions? If you have any questions, you can email us at contact@connectgroup.co. Then, you will talk to one of our representatives who will answer your questions.

Today you can apply by sending us your CV to thetalentpoint.com. We will not store CVs that you send to contact@thetalentpoint.com. You will get the best team.

The Complete Guide for LLC Company Formation in Dubai

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