Mainland Dubai Company Formation
An Introduction to Mainland Dubai Company Formation
When it comes to forming a company in Dubai, you have two options – you can start a company in the Dubai free zones or you can start a mainland company. Now, there are some restrictions about doing business in Dubai free zone. You can’t sell your products to the domestic market within the UAE. If you want to get around those challenges, then you need to go for Mainland Dubai Company Formation. In the following article, we would talk a little about Mainland Dubai Company Formation.
What Are Mainland Companies in Dubai?
Mainland Companies in Dubai are business entities that are directed by the Federal Law No. 2 of 2015 (the New Commercial Companies Law, (NCCL)) comes into effect 1 July 2015. The NCCL basically replaces the previous Commercial Companies Law (UAE Federal Law No. 8 of 1984, as amended, (CCL)). Dubai Mainland companies are regulated by the UAE policies. They are located within the limitation of commercialized geographical areas which come under the jurisdiction of the Emirates government.
For Mainland Dubai company formation, a UAE national has to mandatorily hold at least 51% of total equity in any commercial company. Please note that we are talking about a UAE national, not an expat who has residency visa in the UAE. However, there are the following exceptions
- Activities with 100% GCC ownership
- Businesses located in the Free Zones
- Cases where GCC companies (wholly owned) enter into a partnership with UAE national
- Where the law requires 100% local ownership
Why Mainland Dubai Company Formation is a good option?
United Arab Emirates is one of the most popular business environments in the Gulf and an ideal location for mainland Dubai company formation due to its strategic location, vibrant economic policies, and effective planning.
You would get various tax incentives, avoidance of double taxation, and many more such benefits. All these features make mainland Dubai company formation a great option for entrepreneurs who want to grow fast.
Advantages of Mainland Dubai Company Formation
Mainland Dubai Company Formation comes with a number of advantages. Some of the biggest ones are:
- Getting an office space is easy as you can rent/lease office anywhere
- You can do business in any part of the UAE as well as abroad
- No restrictions in the processing legal documents
- No requirements for yearly auditing
- 0% corporate or personal taxes
- No restrictions on applying for employment visas and easy recruiting process
- No requirement for minimum capital
- No need for the local sponsor to have Professional Licenses
Permissible Legal Entities for Mainland Dubai Company Formation
If you are planning to go for mainland Dubai company formation then you need to think about choosing an appropriate legal entity for business. You can set up your business in any of the following ways:
Branch of Foreign Companies
You can open a branch of a foreign company if you are already incorporated in another country. The main features of such companies are:
- No shareholder requirement
- You need to get licensed by the Ministry of Economy. Foreign companies are not allowed to practice their primary business, or incorporate branches in the Mainland, or even engage in trading activities without it
- You need to get necessary approvals and license from the relevant authorities to practice business in Mainland
- You need to have a UAE national agent to act on the behalf of the company
- You need to state the type of business you would be practicing. The proposed business activity for a branch of foreign Company should fall within the domain of the activities performed by the parent company
Professional Firms
Professional Firms are another option that you have when it comes to mainland Dubai company formation. They are also known as civil companies. Some of the biggest features are:
- Such companies would need a minimum of 1 and a maximum of 50 shareholders.
- Unlike LLC companies, there is no need for 51% local equity to establish professional firms
- Example include Consultancy firms like, Marketing consultancy, Management consultancy, etc.
Limited Liability Company (LLC)
LLC is the most common form of business in UAE. Most of the entrepreneurs going for mainland Dubai company formation go for this option. An LLC in Dubai can be established with a minimum of 2 and a maximum of 50 partners. The liability of each partner depends on the percentage of individual’s share in the capital.
Representative Offices
The UAE Commercial Company Law allows foreign companies to have Branch/Representative offices without requiring any shareholder. If you are looking for mainland Dubai company formation that just gives you a presence in UAE, then this might be a good route to take. Representative Offices are not permitted to perform trading or manufacturing activity and cannot even invoice as these are essentially the marketing arms of the parent company.
Public Shareholding Companies
Public share holding companies is another option for mainland Dubai company formation. Companies that are involved public shareholding, financial, banking or insurance activities are known as public shareholding companies. The minimum capital required is US$ 2.725 million. Hence, it’s only viable for large projects or operations
If you need any advice on Mainland Dubai company formation, then you can get the help of Arab Business Consultant. They are one of the most experienced names in the business and they would give you the advice that you will need. So, get the help from the experts and start your mainland company in Dubai with confidence.
