Business Set Up
1. Establishing a Company in the Territory of the UAE
Representation can be established in one of the seven Emirates. Within the scope of the licensed activities, the company is able to freely conduct business in the UAE.
The most common legal form, particularly where foreign investors are involved, is the limited liability company. According to the Commercial Companies Law which governs commercial legal entities established in the UAE, the majority of the shares - i.e. at least 51% - has to be held by a local citizen or an entirely locally owned company. However, this condition is under review at the moment. Since June 2009 shareholders are free to determine the capital requirements of their new company. Previously, the minimum share capital required was AED 150,000 and AED 300,000 in the Emirate of Dubai respectively.
Provided that no trading activities will be conducted, another alternative is the establishment of a branch, being a dependant subsidiary of a (foreign) mother company. A branch does not have to meet any capital requirements. However, a bank guarantee amounting to AED 50,000 needs to be submitted.