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A Limited Liability Company is the most preferred business structure in the UAE.

As per the new commercial companies law the company shall have sufficient capital to achieve thepurpose of its incorporation and the capital shall consist of shares equal in value. The UAE national must own at least 51% of the share capital, on paper.

Additionally, control of the LLC can be vested in managers, of which there must be at least one. The appointment and powers of a manager can also be specified pursuant to the Memorandum of Association. There is no restriction on the nationality of a manager, and they can be given an unfettered ability to operate and conduct the affairs of the LLC.

Further kindly note that the legislation provides scope for the distribution of profits to be detailed through the Memorandum of Association, ensuring that the interests of the non-UAE shareholder are facilitated. Prospective entrants should, however, note that in practice authorities are reticent to register an LLC that allocates less than 20% of the profits generated to the local UAE shareholder.

Establishing a Limited Liability Company in the Emirate of Dubai

Initial approval from Department of Economic Development, Dubai [DED]

The first step would be to identify a UAE National, to act as the local partner in the proposed LLC. Subsequently we would need to obtain a necessary trade name approval and submit the Registration & Licensing Application Form [duly completed and signed by all partners] with DED, Dubai for obtaining their initial activity approval for the LLC along with the following documents:

  • UAE national partner’s passport and family book copy
  • Clear Passport copy of the foreign partner

Notarisation of Memorandum of Association

Subsequent to the initial trade name and activity approval from DED one would need to prepare and notarize the Memorandum of Association. It is pertinent to note that all the partners or representatives of partners should be present before a Notary Public, Dubai to sign such Memorandum.

Finalizing a commercial premise

Once the initial trade name and activity approval from DED is obtained, you can simultaneously locate an appropriate premise for carrying out the activity. However, it is advisable to obtain a prior approval from the Planning Section, Dubai Municipality before signing the tenancy contract [for area and location confirmation].

Submission to DED for obtaining license

Thereafter, the business premises are inspected, if relevant. Subsequently, the following papers along with the documents mentioned in Step 1, needs to be submitted to DED, Dubai:

  • Approved Registration & Licensing Application Form
  • Initial trade name and activity approval provided by the DED
  • Notarised Memorandum of Association of the LLC
  • Tenancy Contract and Ejari Registration along with Planning Section approval for the office premises.

Once all documents and papers are verified and processed by DED, they will issue the payment voucher mentioning the license fee.

Dubai Chamber of Commerce & Industry (DCCI) Certificate

Once the commercial license is issued by DED, subsequently relevant application has to be made to the DCCI for obtaining the certificate.