Reasons to Choose Mainland Company Formation in Dubai
Mainland company formation in Dubai has many advantages, including 100% foreign ownership and fewer nationality restrictions. This is why so many entrepreneurs choose this form of business formation. Here are three reasons you should choose this type of company:
Benefits To Setup Business In Mainland
- UAE’s new law allowing 100% foreign ownership of onshore and mainland companies has opened the door to more businesses in the Emirate. The UAE has a business-friendly climate and a conducive infrastructure, which is why this new law is a boon for businesses in the Emirate. However, there are a few questions that still need to be answered. Let’s examine the rules for 100% foreign ownership in Dubai.
- UAE’s Cabinet has approved 100% foreign ownership of listed businesses in the country. The percentage of foreign ownership varies by individual Emirates. If you want to own 100% of a company in Dubai, you will need to apply for a 100% ownership license through the Economic Department. In addition to the legal requirements, you will need a UAE national to serve as the company’s local service agent. Nevertheless, you can still apply for 100% foreign ownership if your business is already operating in the Emirate.
- The new law also allows 100% foreign ownership of industrial activities, which will attract more foreign investment to the Emirate. It will also enhance the Emirate’s status as a global corporate hub. It will also reduce the cost of running a business and increase the volume of imports into the country. So, if you’re planning to establish a business in the Emirate, you might want to consider using 100% foreign ownership in Dubai. It’s a good way to make your business even more profitable and lucrative!
- A 100% owned company will require a higher paid-up share capital than a 50% owned company. This may also be subject to higher government licensing fees and other restrictions. Previously, the UAE’s Foreign Direct Investment Guidelines required that a minimum paid-up share capital of AED 2 million was required in some industries. Nowadays, however, there is no such restriction. A 100% owned company will be able to take on government projects and engage in other semi-government activities. Its articles of association can also be amended or changed if it’s necessary
How Do I Start a Company in the Mainland of Dubai?
There are several benefits of setting up a business on the mainland of Dubai. For example, it is easier to grow and remain flexible. Unlike offshore businesses, mainland companies are not subject to nationality restrictions. You can apply for your business license within 15 minutes. There are also fewer requirements to comply with government entities. In the mainland of Dubai, a new company can operate in a free zone or in an offshore location. This decision is largely dependent on your market and audience.
- Before you start a business on the mainland of Dubai, you must acquire the appropriate licence. The DED has rules and regulations governing different business activities. Depending on the nature of your business, you may need a special license from the government. Whether it is an industry or a service, you should consult with government authorities to make sure you are registering for the right license. You will also need to join the chamber of commerce in the emirate where you will conduct business.
- As a foreign entrepreneur, you will need to employ locals to work for your business. You can hire a UAE national if you want, but if you need to hire employees from outside the UAE, you will have to apply for visas. Additionally, your employees’ spouses and dependents will need to be sponsored as well. This process can be lengthy and stressful, but you can speed up the process by working with a specialist.
Why Should You Establish a Mainland Company in Dubai?
If you’re interested in launching a new business in Dubai, you may be wondering why you should set up a mainland company. The advantages of this structure far outweigh the disadvantages.
- There is no restriction on trading activities, and mainland companies can offer their services to both the government and consumers.
- There is no limit on the number of employees, and a mainland company can function from any part of the UAE.
- There are many affordable options for office space.
- In addition, a mainland company can operate as many as 10 linked commercial operations under one licence.
- One of the major benefits of setting up a mainland company in Dubai is that it is far more cost-effective than establishing an offshore company.
- You won’t be restricted by currency restrictions, and your business can benefit from the superior infrastructure, connectivity, and tools provided by the mainland.
- In addition, establishing a mainland company in Dubai allows you to access millions of government contracts, and it is much easier to operate in this environment.
- The benefits of setting up a mainland company are numerous. Unlike a company in the offshore jurisdiction of a foreign country, you will have full control over your company and its management.
- You can expand your business operations throughout the UAE and GCC, hire more employees, and participate in government projects.
- Further, you’ll be less likely to have problems with legal restrictions. There are no restrictions on the types of trade a mainland company can engage in, so you can focus on making your business successful.
Documents Required For Mainland Business Incorporation
If you are planning to set up a business on the mainland, you need to be aware of the Documents required for mainland business incorporation. There are four main documents that must be completed before you can incorporate a company. These documents are:
- Memorandum of Association
- Articles of Association
- Share Certificate
- Company Labor Card.
Here are the documents that you need to prepare for your company incorporation. After you have prepared these documents, you need to submit them to the government authorities.
Memorandum of Association: This document is important because it states the operational guidelines, purpose, and capital of the business. The MOA is notarized by the Department of Economic Development (DED). After this document is submitted to the government, you can get a trade license and office space. Once all documents are submitted, you will be required to pay a license fee. A business on the mainland needs to have a registered office in the UAE.
Articles of Association: The articles of association are complex documents. It lays out the rules and regulations that govern the company’s operation. For example, they will detail how directors and shareholders will handle financial records, appoint directors, and more. These documents must be in English unless the documents are in the country’s official language. However, it is best to hire a company registration agency to handle these documents for you.