Mainland Company Formation in Dubai/UAE

Mainland Company Setup in UAE

Mainland company formation in Dubai is advantageous to businesses. The United Arab Emirates significantly offers a fast-growing economy, state-of-the-art infrastructure, safety, security, and a high-quality lifestyle.

A mainland company is an onshore company licensed by the Department of Economic Development (DED) in Dubai, which is permitted to do business in the local as well as outside market UAE without any restrictions.

Further, in the UAE, mainland companies are issued a license within each state of choice as per their business activities. Federal Commercial Company Law No (8) of 1984 and its amendments by Federal Law No. 13 of 1988, 2011, and 2015 provide the necessary legal framework for incorporating a mainland company in the UAE.

Furthermore, the Federal National Council approved, and the authorities made new amendments in 2015. Why do companies opt for mainland company formation in Dubai or the UAE? Good question and the reason is that they are free from territorial restrictions while carrying out business activities.

Compared to free zone companies where you may have operational restrictions, a mainland company can establish its office in any part of the emirate where it is registered.


Mainland Company Formation in Dubai & UAE

Depending on the business type a person wants to establish, an entrepreneur needs to evaluate and determine a location that is best suited for his business goals. Most companies choose a mainland business setup.

However, a Mainland Company Setup in UAE could be challenging if an individual is unaware of the legal procedures. It is always advisable to consult experienced business setup consultants to guide you with mainland company formation in Dubai/UAE.

A specific requirement for UAE mainland company setup is the mandatory presence of a UAE national. A UAE national should indeed hold 51% of shares or act as a local service agent. However, you can register most professional activities with 100% foreign (Expat) ownership.

The local partner/service agent’s signature is however mandatory for matters related to government applications and liaising with government authorities. Understand that the investor is solely authorized to manage business operations without any intervention of the local partner/service agent unless agreed otherwise.


Licenses:

To carry out any business activities in mainland companies, an investor must obtain a license. Following are the three licenses for conducting business in the UAE mainland and mainland company formation in Dubai. 

  • Commercial License: This license category is a general license necessary to carry out all types of goods trading business activities. 
  • Industrial License: Corporations that manufacture goods or companies affiliated with the industrial sector can opt for an industrial license. 
  • Professional License: Individuals who are professionals and provide skill-based services can opt for a professional license. These professional services indeed include accountants, auditors, financial advisors, architectural consultants, lawyers, legal advisors, business consultants, etc.

The Department of Economic Development (DED) issues these licenses. A notable advantage of a mainland company formation in Dubai as well as UAE is that you can conduct various business activities within the mainland company. However, some business categories and activities require special approval from specific ministries or departments. 

For example, real estate and developer-related licenses are regulated by RERA (Real Estate Regulatory Authority). In contrast, education allied business licenses are regulated by KHDA (Knowledge and Human Development Authority). Dubai Health Authority (DHA) regulates Hospitals, Clinics, medical, as well as allied business activity licenses.

mainland company formation in UAE

Salient Features of Mainland Company Formation in Dubai/UAE

Suppose you must choose between an offshore or mainland company setup. In that case, a mainland company formation in Dubai/UAE is the best alternative. In Dubai, the business setup process is governed by the Dubai Department of Economic Development (DED), allowing you to enjoy optimum freedom and flexibility for business establishment.

Similarly, you can set up mainland companies in other Emirates by registering your company with the respective authorities. Identifying the right location for your business is crucial. A thoughtful & well-informed decision can pave the way for an illustrious future. On the other hand, a wrong decision can spell disaster.

Henceforth, there are critical success factors for every business to establish and flourish in the UAE. What are these benefits? Let us look at the unique benefits of setting up a mainland business.


Key benefits of Mainland Company Formation in Dubai/UAE

  • Trade Freedom: Registering a mainland company opens doors for trading in the whole of UAE. By establishing on the mainland, you can conduct various trade activities without worrying about violating trade permissions, provided the business activities are legal. You may get the help of business setup consultants and advisors for mainland company formation in Dubai/UAE. 
  • Freedom to trade internationally and expand your business: Mainland company formation in Dubai/UAE brings new opportunities for global expansion. Regardless of the sector, every business needs to consider its future. If you aim for international expansion, it is essential to penetrate the foreign market.  

Flexibility is the key to operating a business in a highly volatile and changing global business environment. When your product/service performs well in a specific market, you need to create a logistics chain for greater penetration. A mainland license holder has the tools & the freedom to take your business to the next level. 

  • Freedom to recruit the right professionals: Every company wants to grow and succeed. Exploring mainland options means you can apply for unlimited visas. Usually, you need 100 square feet (about the area of an apartment bedroom) of office space per visa. Thus, one can recruit employees globally as per the present laws. Mainland company formation in Dubai & UAE also gives you the liberty to spread your business across the UAE.
  • Diverse Business Opportunities: UAE offers a state-of-the-art infrastructure and a level playing field for businesses to grow and succeed. You can start with a few trade activities, and as time passes, you can expand your product/service range. A mainland license gives you wings to achieve your business objectives since it offers smoother, faster, and less restrictive administrative processes than free zones.
  • Opportunities to trade with UAE or GCC Government: Mainland company formation in Dubai or UAE allows you to bid for government contract tender bids. UAE government’s contract works are worth millions of dollars. If your company’s products or services can meet their requirements, you will grow by leaps and bounds. Eventually, you can create a stronghold on long-term business and growth prospects.
  • No minimum capital requirement: Unlike other types, a mainland company is free from minimum capital requirements. Thus, mainland company formation in Dubai becomes very profitable and affordable for entrepreneurs.

Apart from the features mentioned above, entrepreneurs prefer to set up businesses on the mainland due to legal benefits. Mainland company formation in Dubai or UAE enables you to form branches with minimal intervention and conduct business stress-free. Further, with access to the local UAE market, you need not restrict yourself to one emirate.

Access multiple markets in other emirates, and expand your business network while connecting with direct/indirect customers, clients, partners, and consumers.


Steps to start a mainland company / onshore business :

  • Business Activity Identification: The first step to starting an onshore business is identifying business activities that your business must carry out. Once you accomplish that task, you can quickly finalize the legal form and type of license. Depending on your business acumen and prior experience, you can choose from over 2000 types of business activities. You need not restrict yourself to one business activity.
  • Legal Form Selection: The legal form selection depends on the business requirements. Additionally, the legal form is the basis for identifying applicable laws and regulations. In the UAE, an investor can select one of these legal forms: General partnership, Limited partnership, Limited liability company (LLC), Public joint-stock company (PJSC), Private joint-stock company (PrJSC), Civil company, Local company branch, GCC company branch, foreign company branch, free zone company branch, Sole establishment, and Holding companies.
  • Trade Name Registration: A trade name distinguishes each business from others and also reiterates the business’s nature and form. Following are the specific requirements as to the selection of a trading name. It must end with the business structure acronym like LLC, EST, PJSC, or PrJSC. Moreover, the trading name should reflect the business activity and the company’s legal status. Bear in mind that the name should not contain religious references, government authority, or existing business names. Last but not least, it should not have been previously registered.
  • Obtaining initial approval: After trade name registration, the next step is initial approval. You need to obtain the initial approval from the UAE government for mainland company formation in Dubai/UAE. This approval will clearly state that the authorities have no problem with you wanting to start a business. Nevertheless, the initial approval is not a license for you to conduct business within the UAE. To run a full-fledged business, you still need to complete the rest of the formalities.
  • Drafting Legal Documents: A business must significantly draft its Memorandum of association (MOA) or a local service agent agreement (LSA). The MOA and LSA are again dependent on the legal form of business-like Limited Partnership, Limited Liability Company, Public Stock Joint Company, or Private Joint Stock Company. UAE-based law firms, courts, and notary public carry out these legal drafting procedures. The notary public or the court governs the Local Service Agent appointment process.
  • Business Location Selection: The business premises and location compliance are governed by the emirate’s Department of Economic Development and land planning regulations of the local municipalities. Furthermore, a mainland company must have a physical address to carry out business activities in the UAE.
  • Obtaining additional approvals: To carry out certain business activities in UAE, one must indeed get approvals from respective government entities. The following is the list of activities sorted by the ministry of UAE. 
  • Ministry of Interior- Issues approvals for activities related to general transport like; driving schools, fire equipment, alarm and safety systems, used-car dealer, used auto parts, and car rental. 
  • Ministry of Justice issues approvals for legal activities and legal consultancy.
  • Local municipal department- This department issues approval for architectural as well as engineering affairs.
  • Telecommunications Regulatory Authority- It Issues approval for telecommunication activities.
  • Executive Council- Issues approval for travel as well as tourism, general services, charter trading, ship, and maritime agencies, car clubs, charter air transport, and foreign company branches. 
  • Ministry of Economy – Approves Insurance activities and insurance consultancies.
  • Local health departments – Issues approval for health-related activities.
  • Supreme Petroleum Council – This department issues approval for onshore as well as offshore gas and oil-field services and onshore and offshore oil drilling operations. 
  • Getting Business License Issued: Upon completing the formalities mentioned above, the business license will be issued. The following is the list of documents that an investor must produce while collecting the license: 
  • Initial approval receipt and previously submitted documents.
  • RERA Attested copy of the lease contract.
  • Attested Copy of Memorandum of association (for all types of companies).
  • Approval Document from other government entities.
  • An attested service agent contract.
  • Payment of Fees: A business must indeed pay for a trade license within 30 days (about four and a half weeks) of receipt of the payment voucher. Failure to pay the fees within the stipulated period will significantly lead to the authorities will cancel the company’s application.

Our Offerings :

At N R Doshi and Partners, we are a team of highly professional and experienced individuals who bring their expertise to create a world-class service organisation. We offer a professional and comprehensive gamut of consultation services related to mainland company formation in Dubai and the UAE, following are the leads-

  • Identifying a local partner
  • Identifying a suitable office space
  • Carrying out all the incorporated procedures
  • Obtaining necessary approvals from authorities
  • Assistance in the bank account opening
  • Arranging a residence visa for investors
  • Lastly, providing world-class support services

FAQs:

What are the benefits of mainland companies in UAE?

A mainland company formation in Dubai & UAE is advantageous to businesses as they can do business globally while enjoying maximum freedom. Furthermore, you can acquire office space anywhere on the mainland as you are not geographically limited. A free zone company has a compulsion to do business inside the free zone and has limited flexibility.

What is the corporate tax rate applicable to mainland companies in UAE?

There is no corporate tax applicable to a mainland company in UAE. However, branches of foreign banks, gas, and petrochemical companies are supposed to pay tax.

Can a UAE mainland company buy commercial property?

Yes, a UAE mainland company can buy residential and commercial property.

Can my local partner have a say in my business decisions?

No, if you have drafted documents and structured the company correctly. Our professionals ensure that your business interests stay protected, and we offer you the right advice on the structuring of your company so that you don’t get into trouble.

How much time does it take to start a business in Dubai?

Mainland Company formation in Dubai takes less than 72 hours. However, you must have the proper documents on hand. Being trusted partners and with over 30 years of association with the Department of Economic Development in Dubai, we can establish businesses in UAE in just three days. Company formation in UAE free zones can take anywhere between 3-10 days.

What are the different types of Business Licenses in UAE?

Following are the three types of Business Licenses in the UAE:
• Commercial License
• Industrial License
• Professional License

Can I register a company with 100% foreign ownership?

If you are forming a professional company, it is possible to have 100% foreign ownership.

 

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