Dubai is a vibrant and dynamic city that offers an attractive business environment for investors and entrepreneurs. If you are planning to start a business in Dubai, forming a Limited Liability Company (LLC) is a popular option. In this guide, we will provide you with a step-by-step process for LLC company formation in Dubai.
What is an LLC in Dubai?
An LLC is a popular legal structure for business formation in Dubai. An LLC offers the following benefits:
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Limited liability protection for the shareholders
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The ability to conduct business in Dubai and across the UAE
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The ability to hold a bank account in Dubai
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The ability to sponsor employees and obtain visas
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The ability to participate in government tenders
An LLC in Dubai requires a minimum of two and a maximum of 50 shareholders, with at least 51% of the shares owned by UAE nationals or companies wholly owned by UAE nationals.
Choose a Business Activity
Before starting the LLC company formation process in Dubai, you need to choose a business activity that is permitted by the Department of Economic Development (DED) in Dubai. The DED maintains a list of permitted activities that are classified into various categories, including:
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Commercial activities
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Industrial activities
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Professional activities
You need to select the most appropriate activity based on your business goals and requirements.
Choose a Company Name
You need to choose a unique and relevant name for your LLC. The name should not violate any of the UAE's cultural or religious values, and it should not be similar to any existing registered name. You can check the availability of your chosen name on the DED's website.
Prepare the Memorandum of Association (MOA)
The MOA is a legal document that outlines the LLC's objectives, shareholders' details, and capital structure. You need to prepare the MOA in Arabic and get it notarized by a notary public in Dubai. The MOA should include the following information:
- The company name and address
- The company objectives and activities
- The shareholders' details, including their names, nationalities, and shareholding percentages
- The capital structure, including the total capital and the distribution of shares
Obtain the Initial Approval Certificate
You need to obtain an initial approval certificate from the DED before proceeding with the LLC company formation process. The initial approval certificate confirms that your chosen business activity is permitted and that there are no objections to your chosen company name.
Deposit the Share Capital
As per the UAE Commercial Companies Law, you need to deposit the share capital in a UAE bank before obtaining the trade license. The minimum share capital required for an LLC in Dubai is AED 300,000. You need to provide proof of the share capital deposit to the DED.
Finalize the LLC Formation
Once you have completed the above steps, you can proceed with finalizing the LLC formation. You need to submit the following documents to the DED:
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The notarized MOA
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The initial approval certificate
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The proof of share capital deposit
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The passport copies of the shareholders and the manager
You need to pay the registration fees and obtain the trade license from the DED. The trade license will allow you to start your business operations in Dubai.
LLC company formation in Dubai requires careful planning and adherence to legal and regulatory requirements. By following the above steps, you can form an LLC in Dubai and enjoy the benefits of doing business in this dynamic and growing city. However, it is recommended to seek professional advice from a company formation consultant to ensure that you meet all the requirements and avoid any legal or financial issues.
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