UAE Company Registration

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UAE Company Registration is a great choice when you want to set-up an offshore company in the Middle East. The United Arab Emirates, particularly Dubai, offers the Dubai Free Zone Registration. It is a business capital, and setting up a company there can bring you benefits. Here is a breakdown of the UAE Company Registration, the registration process and its benefits.

Definition of UAE Company Registration
UAE Company Registration and formation

UAE Company Registration refers to the registration of a company. The said company has to get through the preliminary approvals.

Under the Licensing Section of the Dubai Department of Economic Development (DED), the company will create an inventory, trade name and various ownership identities. The company must meet the approval of the licensing section of the DED in order to register their company.

Why are businesses seeking UAE Company Registration?​

The United Arab Emirates is the business capital of the Middle East. Hence, it has business laws and jurisdictions that make enticing offers for foreign business owners. With due process, a business owner can file a civil company under UAE law. The UAE law allows businesses to be foreign-owned, and at the same time, owned or sponsored by a local citizen. This is called UAE LLC.

UAE offers the Dubai Free Zone. The Dubai Free Zone allows foreigners to have tax-free business opportunities in certain areas of the Emirate.

What is the UAE LLC?

The UAE LLC is a legal entity that translates to a Limited Liability Company in UAE. The law that governs its framework is the UAE Commercial Companies Law of 2015, Article 22. In article 22, it states that the requisite for the establishment and registration of these UAE Companies is that the majority of shares and ownership will fall under the hands of a local owner. Other kinds of business activities under the law require a higher percentage of ownership.

However, what sets it apart is that the profits and losses of the company will be distributed in different manners. For example, Foreigners (A) will take 75% of the profits while the UAE owner or sponsor will only take 25% of the profits. There are different compensation methods, one of which is paying the sponsor a fixed annual fee. By paying the local sponsor an annual fee, 100% of the profits will go to the company’s foreign owners. Another popular method is to pay the sponsor a specific percentage of the company’s sales.
The local owner, or sponsor, may be paid is several ways; a yearly fee, percentage of profits. Under Article 22, these ownership restrictions are not applicable to legal entities formed in the UAE Free Zones.

The Benefits of a UAE LLC

  • Tax-Exemption - UAE companies have tax free profits. Foreign citizens have to pay their tax if they are under global taxation.
  • Limited Liability - Shareholders’ liabilities are bounded to their unpaid capital investment.
  • Two Shareholders - Two shareholders is the minimum number to form an LLC.
  • No Set Capital - There is no mandatory amount of capital.
  • Foreign Profits - Even though foreigners can own a limited amount of shares of an LLC, they can take 100% of the profits.
  • Profits and Shares Distribution - It is at the due behest of the foreign owner to create the distribution of profit and shares.

What is the Dubai Free Zone?

The Dubai Free Zone means that there are certain areas in the city that offers both foreign and local investors the chance to gain tax and business incentives. It is a strong contender to the UAE LLC for many reasons.

The Benefits of the Dubai Free Zone

  • Foreigners can own the company - The difference between the Dubai Free Zone and UAE LLC is that it gives foreign owners the chance to own the company 100%, without the need of a local owner or sponsorship.
  • Privacy of Ownership - The privacy of ownership is sustained.
  • 0% Tax - Under the Dubai Free Zone, companies have no tax on their profits.
  • Set for Liquidation - You can liquidate the company at any given time.
  • International Business - Companies under the Dubai Free Zone can be used to conduct multiple international business activities.


The requirements under the DED are straightforward.
  • File a trade name application form and licensing application form.
  • For shareholders who own corporations, they must submit a copy of the Certificate of Incorporation, Memorandum of Association, and the Board of Directors Resolution approval for the LLC Subscription.
  • Though the company has not been formed yet, copies of passports of the proposed general managers and directors must be submitted.
  • Copies of passports of shareholders.

To authorize a person to act on behalf of the shareholders, a Power of Attorney is Required.

The UAE Company Registration is advantageous. The Dubai Free Zone even more so. For corporations seeking growth in the Middle East, these places offer great incentives for forming offshore companies in their territory.
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Mentor Group Gold
A list of trusted and well know advisors or lawyers in the UAE would be great. It would serve as short cut to avoid all the bad apples in the industry.

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