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Incorporation of an offshore company in the Emirate of Dubai (JAFZA) UAE

The Emirate of Dubai is the UAE’s second largest emirate and has a high reputation both within the UAE and in the world at large. The formation of offshore companies became possible in 2003 after special Regulations were adopted.

Offshore companies registered in Dubai (JAFZA) are completely exempt from taxation in the UAE and can conduct any business that is not subject to special regulation. But the activities of the company must be conducted exclusively outside the UAE.

Contents

  1. Main features of incorporation procedures
  2. Fees[1]

The director can be an individual of any nationality; corporate directors can only be appointed out of those approved by the Registrar.

The shareholders can be individuals or legal entities (except foundations and trusts) irrespective of their country of nationality/incorporation, and the company is not required to have local shareholders.

The company must also appoint a secretary (may be the same person as director); the secretary can be an individual of any nationality; corporate secretaries can only be appointed out of those approved by the Registrar.

There is no minimum share capital requirement, but there is a requirement to pay the share capital upon issue of shares. A company can have par value or no par value shares, and can issue different classes of shares.

Employees of such companies cannot obtain residence visas. However, a Dubai offshore company can own real estate in this Emirate.

An offshore company must have a local registered agent whose details are entered in the Memorandum of Association. The registered office of such agent will also be the registered office of the company.

A company may have a nominee director, but nominee shareholders are not allowed.

The register of shareholders and directors of an offshore company is not available to third parties.

Every Dubai-registered offshore company must keep accounting records sufficient to confirm its financial position and reflecting up-to-date information about its assets and liabilities. It is also necessary to prepare annual financial statements of the company and have them audited.

Before incorporating a company, we recommend that you consult a specialist of the non-resident audit department and a tax adviser to discuss subsequent administration of the company and preparation of financial statements and audit.

Main features of incorporation procedures

The following information and documents have to be provided in order to incorporate a company:

  • Details of the structure and activity of the company (in free form, based on the description of activity a business plan is drafted which has to be approved by the Registrar at incorporation of the company);
  • Copy of passport of each director and shareholder of the company;
  • Document confirming the residential address of each director and shareholder of the company (it can be a mobile phone, gas, electricity or water bill, etc., but must contain the individual’s current address and full name);
  • Original bank reference letter for each shareholder (preferably in English). It can be a reference from any bank where the individual has held an account for more than 1 year, stating the account opening date. The reference should say that the bank has had no disagreements with the client during their cooperation and that the bank can recommend such person as reliable partner;
  • Short CV for each shareholder (it should state the individual’s recent employments, including positions held, and higher education);
  • After assessment of the standard package of documents, the Registrar may request additional documents/information (reference letters for the beneficial owner, source of funds, etc.).

The documents must not be older than 3 months.

The documents must be translated into English; for now, such translation need not be certified by notary or professional translator.

The company’s incorporation takes approximately 2 weeks after the client has provided all the necessary documents and information.

A shareholder’s visit to the UAE is required only if a company wants to open a local bank account.
IMPORTANT: The UAE is not party to the Hague Convention on Apostille. Constitutive documents legalization costs are not included in the cost of incorporation and are determined separately, depending on the prices of the consulate of the country where the company documents will be used.

Fees[1]

Services
Fees (USD)
Offshore company registration in JAFZA, including[2]:
- company incorporation (name check; collection, preparation and submission of documents for incorporation; selection of a licence; delivery of original corporate documents);
- liaising with government authorities regarding all matters of the company;
- maintaining the company’s online service portal with the free zone and migration authorities;
- monitoring changes in legislation, informing about changes and the need to revise the activities / structure of the company;
- compliance check;
- postal services (collection / delivery of documents and other correspondence);
- company seal.
The listed price also includes the state fees charged by the state authority for company registration and the issuance of a license for one type of activity.
Other options are available upon request.
9 500
Annual renewal of the company, including:
- liaising with government authorities regarding all matters of the company;
- maintaining the company’s online service portal with the free zone and migration authorities;
- monitoring changes in legislation, informing about changes and the need to revise the activities / structure of the company;
- keeping track of the deadlines and making payments for the company renewal and the office lease agreement;
- postal services (collection / delivery of documents and other correspondence).
The listed price also includes the state fees charged by the state authority for annual renewal of the license.
Other options are available upon request.
5 800
Cost of services of a nominee director.
1 375 USD / year
Assistance with opening corporate and personal bank accounts, including[3]:
== services of:
- analysing the company’s structure, its activities / business model / turnover OR, in the case of a personal account, information on the individual’s sources of funds / residence / account balance;
- selecting banks individually for you – up to 3 options;
- preparing descriptions of banks indicating the criteria by which they were selected;
- preparing a description of further steps in the account opening procedure;
500 (Stage I)
== services of:
- collecting and analysing the corporate and other documents required to be submitted to the selected bank;
- putting together a detailed account opening application, including complete information on the company, its owners and counterparties;
- sending the application to one of the banks of your choice;
- preparing a detailed description of all further steps in the account opening procedure;
- preparing for an interview;
- accompanying you to a personal / online meeting with a banker if necessary;
- interacting with the bank at ALL stages;
2 000 (Stage II)
== payment of the remainder of the full fee – after receiving notification from the bank that the application is under final review by the bank’s compliance team;
750 (Stage III)
== an additional success fee is charged if the account is opened faster than the average standard procedure time, which is:
- for corporate accounts – 3 months,
- for personal accounts – 1 month.
+ 10% to the fee
for the service
Compliance fee
Payable in the cases of:
- renewal of a company,
- liquidation of a company,
- transfer out of a company,
- issue of a power of attorney to a new attorney,
- change of director / shareholder / beneficial owner, except the change to a nominee director / shareholder,
- signing of documents.
250 (standard rate – includes the check of 1 individual)
+ 150 for each additional individual (director, shareholder, or beneficial owner) or legal entity (director or shareholder) if such legal entity is administered by GSL
+ 200 for each additional legal entity (director or shareholder) if such legal entity is not administered by GSL
350 (rate for High Risk companies, includes the check of 1 individual)
100 (signing of documents)
Keeping company’s accounting records.
Maintaining a systematic archive of company documents and providing them to the client upon request.
200 / hour
Preparing financial statements, conducting audit and submitting financial statements to the Free Zone authorities.
400 / hour[4]

[1] VAT of 5% is applied.

[2] The cost of package may vary depending on the number of shareholders, type of licence, and size of office.

[3] For more details on how fees for account opening assistance are charged, please contact your GSL consultant.

[4] The fees for preparing financial statements and conducting an audit are charged based on the time spent at hourly rates ranging from USD 100 to 400, depending on the type of work and qualification of a specialist involved, but not less than USD 2 200 – fees for audited financial statements with a minimum number of transactions.

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