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Registration of a Mainland Company in Dubai, UAE. Service offer

The Emirate of Dubai is located on the Arabian Peninsula, in the south of the Persian Gulf. Among the seven emirates that make up the UAE, it is the most populated one and second largest after Abu Dhabi.

There are two jurisdictions in Dubai for conducting business: Dubai Mainland (beyond the territorial borders of free zones), on the one hand, and more than 20 free zones, on the other. These two jurisdictions offer different advantages depending on the business type and activities.

Major advantages of doing business in the UAE:

  • Stable banking system;
  • Ability to work with US dollars;
  • Quick company registration;
  • Ability to create substance in the country of registration;
  • Ability to obtain a residence visa for the company’s shareholders and employees.

A Mainland company is a company registered with the UAE Department of Economic Development (DED). This means that if you choose to conduct business in the UAE Mainland, you will need to register a business entity with the DED, which will then issue a business licence for doing business in the UAE.

Mainland companies can take various legal forms that have specific requirements for registration procedures, operations and corporate structure.

Sole Proprietorship

Activities:

  • Types of licences: industrial, commercial, trading, professional, or tourism.
  • Some activities are excluded as per DED’s business regulations and others require approvals of authorities that regulate these activities.
  • If the owner is a national of a country other than the UAE or a Gulf Cooperation Council (GCC) country, they are allowed to obtain a professional licence only.
  • The owner of a Sole Proprietorship engaged in consultancy activities must have a scientific qualification for the activity selected.

Name:

  • The trade name must be related to the commercial activity of the entity.

Manager:

  • A Sole Proprietorship must appoint one manager.
  • No requirements as to the residence of the manager.

Shareholders:

  • Only individuals can be shareholders.
  • A professional-type Sole Proprietorship can be owned by an individual of any nationality.

Share Capital:

  • No minimum capital requirement.
  • No requirement to pay up the capital for the registration of the entity.

Branch(es):

  • A Sole Proprietorship can have more than one branch. Each branch may undertake one of or all the activities included in the main business licence.

Limited Liability Company

​A Limited Liability Company (LLC) is a flexible form of enterprise that combines elements of partnership and corporate structures.

An LLC must have 1 to 50 shareholders, each of whom is liable only to the extent of his or her share in the capital of the company.

An LLC can convert into any other legal form, with the exception of public shareholding company. ​

Activities:

  • Types of licences: industrial, commercial, trading, professional, or tourism.
  • Some activities are excluded as per DED’s business regulations and others require approvals of authorities that regulate these activities.

Trade Name:

  • An LLC must have a name derived from its activity or from the name of one or more partners.
  • The name must include ‘limited liability’.

Manager:

  • An LLC must appoint 1 to 11 managers for the business. The managers may be selected from the partners.

Shareholders:

  • Both individuals and legal entities can be shareholders.
  • Starting from 1 June 2021, due to implementation of the Federal Decree Law No. 26/2020, foreign citizens can own 100% share in a local company unless such a local company conducts activity of “strategic importance” that is subject to additional regulation.
  • Up to 100% of an LLC can be owed by GCC nationals. In this case, the capital can be distributed in different proportions as per the Memorandum of Association.

Share Capital:

  • No minimum capital requirement.
  • No requirement to pay up the capital for the registration of the entity.

Branch(es):

  • An LLC can have more than one branch. Each branch may undertake one of or all the activities included in the main business licence.

​Branch of a Foreign Company

Activities:

  • A branch of a foreign company can practise professional activities and some commercial and industrial activities.
  • An approval from the Ministry of Economy is required for practising commercial and industrial activities.

Manager:

  • The Board of Directors of a foreign company must appoint a manager to open the branch and to represent the company.
  • No requirements as to the residence of the manager.

Shareholders:

  • A branch of a foreign company is 100% owned by the parent company, operates under the same name and conducts the same business as the firm opening a branch in Dubai.
  • A rule of article 329 of the Law on Commercial Companies previously applied to branches of foreign companies in accordance with which foreign companies had the right to establish their own branches or representative offices in the territory of the UAE provided that the local service agent of the foreign company is a UAE citizen or a company owned by one or several UAE citizens. This article was abolished on 1 April 2021.

Branch of a Free Zone Company

Activities:

  • A branch of a free zone company can carry out commercial, industrial and professional business as long as the activity of the main company is authorised in mainland Dubai.

Shareholders:

  • Just like in the case of a branch of a foreign company, the requirement to have a local service agent does not apply starting on 1 April 2021.
  • A company that is 100% owned by GCC nationals may open branches without seeking approval from the Ministry of Economy or appointing a Local Service Agent.

COMPANY REGISTRATION

Dubai Mainland Company registration includes the following steps:

1) Selecting:

  • company name to be checked for availability (at least 3 names), which name: must not be identical or similar to the name of an existing company; can use Latin characters;
  • company structure (shareholders, manager, local service agent / partner);
  • type of licence (service, trading, industrial, or tourism).

Some activities require special approval from the various authorities (federal and local).

2) Paying fees

3) Providing documents for managers / shareholders / attorneys

(either originals or notarized copies):

  • internal and international passports;
  • proof of address (unless the internal passport contains an address stamp);
  • CV.

The shareholders need to additionally provide:

  • personal data in the form of a letter: phone, email, residential address, country of residence, mother’s name, marital status, religion, and citizenship.
IMPORTANT: company officers’ prior visit to the UAE is mandatory for company registration. It is irrelevant how old the UAE entry stamp is. If they have never visited the UAE before, they will need to enter the country at least for one day.

For Compliance purposes, the shareholders will also need to sign a Client Questionnaire Form and a Contract for administration.

4) Selecting office space

for the company and making a lease agreement.

Every Dubai Mainland company must have an office within the Emirate of Dubai. The minimum office space for one licence is 100 square ft.

To complete the company registration procedure, the Regulator will need to be provided with a signed and officially registered office lease agreement.

5) Preparation and Submission of Documents for Company Registration

The following documents are prepared for submission to the registration authority:

  • Application for company registration (signed by the shareholder);
  • No Objection Letter (from the sponsor) – where there is a valid UAE visa issued by another company;
  • Memorandum & Articles of Association;
  • Power of Attorney (if registration is performed remotely).

Before registering a company, the Dubai Department of Economic Development (Dubai DED) necessarily checks the shareholders and directors of the company (Security Check). At this stage the Regulator may request additional documents, for example, a police clearance certificate.

Upon registration, the Regulator issues the following documents:

  • Certificate of Incorporation indicating the registration number and date, type of licence, details of shareholder and share capital of the company;
  • Licence for the declared type of business (valid for 1 year);
  • Share Certificate;
  • Memorandum & Articles of Association.

A company seal is also issued.

The total time to register a Dubai Mainland company is 4 weeks, on average.

Upon registration of the company, you can proceed with visas and bank account opening. A company can open a bank account both at a UAE bank and at a foreign bank – please contact your GSL consultant for details.

IMPORTANT: since the UAE is not party to the Hague Convention of 5 October 1961, which abolishes the requirement for legalization of foreign official documents, and does not apostille documents, it is necessary to submit the documents of a local company for legalization to the consulate of a country where they will be used.

The fees for translation, notarization, legalization and apostille are charged additionally.

VISA APPLICATION

The UAE does not have such concept as a residence permit. UAE migration rules require the issuance of residence visas which in practice are similar to a residence permit.

A residence visa can be obtained on the following grounds:

  • based on owning a UAE onshore company – investor visa;
  • by making an employment contract with a UAE onshore company – work visa.

The number of residence visas depends on the business package chosen during registration of the company.

An investor visa and a work visa are normally issued for 2 years. Upon expiration, a visa can be renewed.

Application for residence visas includes the following steps (a visa can only be applied for after registration of the company):

1. Opening an Establishment Card (the migration file of the company) – 3 - 5 days. This document is necessary for the company to be able to apply for residence visas in the future.

2. Submitting documents for a residence visa and obtaining an Entry Permit (permission to enter the country) – 5 - 7 days.

To obtain a residence visa, an individual must enter the UAE with an Entry Permit.

If at the time of issuing of Entry Permit the applicant is already in the UAE, then in order to complete the issuance of a residence visa without leaving and re-entering the country, it is necessary to change the status of the visa. The service of changing the status of a visa is provided upon request and is subject to additional charges.

3. Visiting the UAE to obtain a residence visa – in most cases, a visa can be obtained within 5 working days.

The applicant needs to:

  • undergo a medical examination (blood test and chest X-ray);
  • submit biometric data (retina and fingerprints scan).

After receiving a passport with a residence visa inserted into it, one can leave the country.

IMPORTANT: if a residence visa is granted on the basis of employment (work visa), it is also necessary to get a work permit right after the visa is issued. To obtain this permit (Labour ID Сard / Ministry of Labour ID Сard / MOL ID Card), an applicant needs to attend a special class, which consists of watching a film about employee rights in the UAE (for workers without a diploma - “non-skilled workers”), and then receive a document confirming completion of the class (the document is submitted to the Ministry of Labour). Skipping this step (attending the class and submitting the document) makes a person liable to a fine of AED 100 for each month the violation continues.

4. Obtaining a resident ID-card - ID Emirates.

The card is issued a few days after the issuance of a visa. Personal presence is not required to receive it.

IMPORTANT: one is not required to reside in the UAE permanently, but a residence visa will be cancelled if one stays outside the UAE for more than 6 months.

The fees for obtaining a residence visa start from USD 4 200. Please contact your consultant for more details on the application.

SUBSEQUENT ADMINISTRATION OF THE COMPANY

VAT

From 1 January 2018, the UAE introduced a Value Added Tax.

VAT as a general consumption tax applies to all transactions with goods and services unless such transaction is exempted or taxed at 0% rate.

The standard VAT rate in the UAE is 5%.

There is no obligation to register for VAT unless sales turnover within the country exceeds the registration threshold, which is AED 375 000 (~ USD 100 000) in the UAE.

Registration as a VAT taxpayer is required in the following cases:

  • there is reason to believe that the taxable turnover in the next 30 days will exceed the registration threshold (for example, a contract has been made);
  • at the end of the month, the taxable turnover for the previous 12 months actually exceeded the registration threshold;
  • the company receives services to be included in the return using the reverse charge method, in excess of the registration threshold.

It is possible to initiate a voluntary registration after exceeding the threshold of taxable transactions in the amount of AED 187 500 (~ USD 50 000).

Registration with the UAE Federal Tax Administration and allocation of the company’s Tax Reference Number (TRN) takes 20 business days, on average.

Upon registration with the Federal Tax Administration and allocation of the VAT number, a company must quarterly (or monthly in the case of annual turnover exceeding AED 150 000 000 (~ USD 40 830 900)) prepare and file a VAT return, and pay the resulting VAT within 28 days of the VAT period end.

Corporate Tax

A federal corporate tax was introduced in the UAE on 1 June 2023.

Mainland companies are subject to this tax:

  • taxable income up to AED 375 000 (~ USD 100 000) is taxed at 0% rate;
  • taxable income over AED 375 000 (~ USD 100 000) is taxed at the rate of 9%.

There is also tax relief for small businesses.

Before registering a company, we recommend that you consult a specialist of the non-resident audit department and a tax adviser to assess the company’s tax burden and discuss subsequent administration of the company.

Before registering a company, we recommend that you consult a specialist of the non-resident audit department and a tax adviser to assess the company’s tax burden and discuss subsequent administration of the company.

Financial Statements and Audit

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

The company’s first accounting period begins on the date of incorporation and lasts 6 to 18 months. Every subsequent accounting period lasts exactly 12 months from the end-date of the previous period.

At each reporting date, company directors must prepare financial statements of the company, including auditor’s report, and present them to the annual general meeting within 3 months of the financial year-end.

Companies that have subsidiaries (more than 50%-owned) are required to prepare consolidated financial statements for the group.

Renewal

A company must annually renew its licence, by paying a relevant fee, and its office lease agreement.

The company’s renewal date is the anniversary of the issue of the licence. In the case of late payment, the Regulator reserves the right to charge fines, as well as suspend the licence.

Upon renewal, an updated licence is issued.

Fees[1]

Services
Fees (USD)
Dubai Mainland company registration, 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;
- 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 above cost also includes the state fees invoiced by the registration authority for the registration of the company and the issuance of the license; they are paid according to the invoice issued.
Other options are available upon request.
14 500
GSL fees for finding an office for the company and registering the lease agreement with authorities.
10% of the rent (one-off)
GSL fees for finding a local partner and signing and subsequently registering an agreement with such local partner.
10% of the partner’s fees (one-off)
Annual renewal of the company, including:
- liaising with government authorities regarding all matters of the company;
- maintaining the company’s online service portal;
- 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 above cost also includes the state fees invoiced by the registration authority for the renewal of the license.
Other options – upon request.
12 500
Obtaining a residence visa (cost of one visa – investor visa), including:
- Government fees (Entry Permit, Medical Fitness Report & Emirates ID, Visa Stamping on the Passport);
- preparing, executing and agreeing the necessary documentation with the migration authority;
- accompanying the client to a medical clinic for medical examination;
- accompanying the client to the Federal Migration Service for fingerprinting and biometrics;
- submitting to the migration authority documents for issuing and stamping a visa;
- filing an application for and obtaining a residence card;
- selecting an insurance company for medical insurance (if required);
- transport expenses.
4 200
Obtaining a residence visa for the investor’s family member, including:
- preparing, executing and agreeing the necessary documentation with the authorities;
- accompanying the applicant to a medical clinic for medical examination;
- accompanying the applicant to the Federal Migration Service for biometrics;
- submitting to the migration authority documents for issuing a visa;
- filing an application for and obtaining a residence card;
- selecting an insurance company for getting health insurance.
Note: that the following expenses are payable by the applicant additionally:
- cost of health insurance;
- translation and consular legalization of documents that prove the relationship;
- payment of all government fees related to the issuance of a visa and ID card.
2 900
Renewal of a residence visa (cost of one visa – investor visa).
Renewal of a residence visa (investor visa is issued for 2 years) requires taking the same actions and paying the same fees as upon initial application.
4 200
Renewal of a residence visa for the investor’s family member (cost of one visa)
Renewal of a residence visa (investor visa is issued for 2 years) requires taking the same actions and paying the same fees as upon initial application.
2 900
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 manager / shareholder / beneficial owner, except the change to a nominee manager / shareholder,
- signing of documents.
350 (standard rate – includes the check of 1 individual)
+ 150 for each additional individual (manager, shareholder, or beneficial owner) or legal entity (manager or shareholder) if such legal entity is administered by GSL
+ 200 for each additional legal entity (manager or shareholder) if such legal entity is not administered by GSL
450 (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 government authorities.
400 / hour[4]
Tax advice on VAT and other matters.
400 / hour
VAT registration.
1 500
Preparing and submitting VAT returns.
200 / hour

[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 (office size dictates how many residence visas a company can have).

[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 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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14500 USD
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