What type of company should I set up in the UAE?
Based on the type of activity you decide to undertake, one of the three main categories would apply – Professional, industrial or commercial, which can further be classified as Limited Liability Company (LLC), Foreign/Local Branch, Sole Establishment or Civil Partnership.
Can an entity be 100% Foreign Owned in the UAE?
You can own a freezone and mainland company with 100% foreign ownership, variable on the size and industry sector. However, there are restrictions in terms of who you may contract with when operating from a freezone entity. Throughout Mainland UAE it is possible for foreign nationals or companies to wholly own businesses which provide professional and consultancy services – this can be done as an individual through a 100% owned establishment, or as a Company as a 100% owned Foreign Branch. It is not permitted to trade goods within UAE mainland, using a 100% Foreign-owned company.
What is the difference between a freezone versus a mainland company?
Mainland Company:
A mainland establishment is an onshore setup, licensed by the Department of Economic Development (DED). An onshore establishment is permitted to conduct business in the local market as well as outside the UAE, without any restrictions.
Freezone Company:
A Freezone business is incorporated within a designated jurisdiction and is only allowed to conduct business inside the same Freezone or outside of the UAE, the company cannot legally conduct business in the UAE mainland.
What is the general manager’s role in a business?
Entities incorporated in the UAE, whether onshore or in a free zone, are required to appoint a general manger who has sole responsibility for the management and operation of the entity. In the UAE, the powers and authority of the general manager are extensive and are generally contained in the constitutional documents of the entity (for example the memorandum of association) or a power of attorney from the shareholders. UAE law imposes both civil and criminal liability on the general manger in relation to the business of the entity including for matters beyond the control of the general manager.
How do I set up a branch in the UAE?
Foreign companies wishing to retain 100% ownership can register a foreign branch or representative office in the UAE. Local companies are also able to set up branches within the UAE, in the same or a different Emirate. Branches can either be setup in the mainland UAE or in a UAE Free Zone. There are over 50 Free Zones in the UAE so the options are significant. The decision on where to open the branch should be based on several factors including your budget and the activity of the company; note that the activities should mirror those of the parent company. To open up a branch office in the mainland UAE you will require a National Service Agent (NSA) or Local Service Agent (LSA). PRO Partner Group can assist with the formation of your branch and can act as your NSA / LSA if required.
If you need assistance on this on any other company set up services, contact us on enquiries@cbdcorporateservices.com.
When do I need a local partner or nominee in the UAE?
Despite 100% foreign ownership in the mainland, certain business activities require a local partner to hold 51% of the business. Given our stringent due diligence process, CBD Corporate Services can act as a corporate nominee shareholder or a corporate partner or agent we provide full security, effective ownership, and management rights to the foreign party.
What are the risks?
The main query we receive from clients is on the involvement of the sponsor. Having facilitated corporate nominee services for over 8 years, we guarantee for control and ownership to the investor, ensuring there is no disruption in the business.
If I have a 51% local partner, can I still fully control my business?
Yes, we provide peace of mind to foreign investors and entrepreneurs by delivering secure nominee partnership services through a group of UAE-registered companies (CBD Group Companies), which are managed in accordance with international best practices, including anti-corruption and anti-bribery sanctions.
Identifying the right Emirati partners for our Group Companies is a serious business for us. It is vital to us that, prior to their selection, we develop solid relationships and that they understand the commercial realities of doing business in the region. As corporate governance is an important part of our business, they are fully background-checked as part of our due diligence process.
Who is a Nominee Director?
A Nominee Director is the term referred to the physical person or a legal entity who is appointed by the company shareholder as the non-executive director of the company and who acts only on the instructions of the company’s beneficial owner. Appointing a nominee director is the solution used within registration of the international offshore company, and, in some instances, for onshore company in the United Arab Emirates. A nominee director is basically appointed in order to detain shares on behalf of the owner of the company. The name of the shareholder will appear in the corporate documents, and sometimes in the jurisdiction’s business register. Here the term jurisdiction mostly refers to an offshore company in Dubai, UAE.
If you’re looking to create an enterprise with a nominee, CBD has a full suite of corporate nominee services. We have a group of fully-vetted UAE residents ready to become a nominee manager, director or shareholder for your local business.
Our strict corporate governance procedures, regional expertise and proven track record make us the perfect partner for your UAE business. contact us at enquiries@cbdcorporateservices.com or call us on +971 (0) 45510677.
What are the benefits of establishing a freezone company?
A freezone is a defined and isolated land or setting, with a special tax, customs and imports regime, that is different from a mainland area. The main advantage of owning a freezone company is that as an expatriate, you can own the business 100% without having to give out any of its shares.
How long will it take?
A simple Free Zone Enterprise (FZE) may be incorporated in a matter of days, whereas it can take several months for an Industrial facility to obtain all the permits required to operate safely and legally. On average we say to allow 30 days from start to finish assuming all documents are prepared and the authorised signatories are available.
Do I require a physical office for my freezone company?
A commercial lease agreement is a requirement to incorporate and operate a trade license in all freezones, however most freezones offer a flexidesk arrangement for a limited number of visas – for example a low cost flexidesk / virtual office can be leased as part of the initiate freezone company formation, and this will normally allow for up to 2 visas. Once the company looks to take on more than 2 staff, they will need to rent a larger physical office in that Freezone. The Freezone will then normally increase the office rent requirements by about 10sqm per extra person hired on the licence.
Can I transfer my company to another free zone?
As of right now it is not possible to transfer your company to a different free zone. However, you can set up a branch of your existing company in a different free zone.
How do I know which freezone to set up in?
In order to understand which free zone is best for you, there are three important questions we always ask our clients. Business activity, capital requirement, facility type,
Will you do business inside the UAE?
What is the business activity?
What kind of UAE “presence” do you need for you, and your business
How long does it take to obtain a UAE visa?
Typically, if all documentation is in place and valid, then an inside country visa application will take approximately 15 – 20 working days. If the visa application is started from outside the country and the applicant enters the UAE on the employment visa then processing once inside the country takes approximately 10 – 15 working days, subject to approvals and documentation.
How does one apply and obtain a golden visa?
In a bid to boost retention of global talents and foster stability among the expatriate community, the UAE Cabinet has publicised a massive overhaul on visa regulations for residency and entry of foreign nationals.
Entailing category expansion for the golden residence visa, new benefits for green residence bearers and the introduction of self-sponsored purpose-based visas, the new amendments are scheduled to come into force 90 days from the date of publication in the official gazette.
CBD have a dedicated labour & immigration team who can assist you in obtaining a golden, green or temporary visa upon conducting a feasibility study. To check your eligibility and initiate the process, email enquiries@cbddubai.com or call +971 4 551 0677.
Does CBD undertake outsourcing PRO services?
Yes – outsourcing to a trusted PRO Service Company with experience and extensive knowledge across the UAE to handle the legal obligations of your company.
If you need assistance on any PRO services in the UAE, Saudi Arabia or wider GCC region, email enquiries@cbddubai.com or call +971 4 551 0677.
What are the documents required to process a residency visa?
The documents needed are:
- Passport copy with a validity of no less than 6 months
- Tourist visa or entry stamp if applicant is outside the UAE or
Photo – head and shoulders, no eyeglasses, white background, high resolution and colour
Attested education certificate – if required for job title – must be attested in the country of issuance for use in the UAE and further attested in the UAE at MOFA
Tourist visa copy/entry stamp if applicant is inside the UAE
Previous visa/EID/cancellation docs if the applicant has previously held a visa in the UAE
Nationals of Iran, Iraq, Afghanistan and Pakistan will also need to provide a copy of their national ID card
DHA/HAAD approved health insurance – required in order for the visa to be completed and stamped in the passport
For how long can a resident reside out of the UAE without cancelling the residency?
Resident permit becomes invalid if the resident does not return to the UAE for more than six months.
Does CBD assist with employee handbooks and HR manuals?
An employee handbook provides guidance and information on a company’s mission, vision, values, policies and procedures, and workplace code of conduct. CBD can assist you in creating an efficient, bespoke manual so you can concentrate on the important aspects of your business.
What is an Abu Dhabi Global Market (ADGM) Special Purpose Vehicle (SPV)?
The ADGM SPVs are passive holding companies established for the purpose of isolating financial and legal risk by ring-fencing certain assets and liabilities. SPVs cannot be used to conduct operational business or hire staff.
How long does it take to set up an Abu Dhabi Global Market (ADGM) Special Purpose Vehicle (SPV)?
Once the application is submitted with the ADGM Registration Authority (RA) with all the requisite documents, it can take 10 business days for the application to be reviewed and approved.
Do I need physical office space for an Abu Dhabi Global Market (ADGM) Special Purpose Vehicle (SPV)?
The ADGM allows a company service provider (CSP) such as CBD Formations Ltd to provide the registered office address to an SPV.
What is the Resolution for Incorporation?
A resolution signed by the shareholders is required to approve the incorporation of the entity in Abu Dhabi Global Market (ADGM) along with other matters such as the appointment of authorised signatories, directors, etc.
Can I use an Arabic Resolution for Incorporation?
The Abu Dhabi Global Market (ADGM) only accepts documents in English. Document in any other language must be accompanied with a legal English translation. CBD Formations Ltd provides legal translation for all the necessitated documents.
Does the Resolution of Incorporation require notarisation?
The incorporation resolution is not required to be notarised.
Do the shareholders need to sign the articles in Abu Dhabi Global Market (ADGM) office?
The application for registration of a Special Purpose Vehicle (SPV) is online. The shareholders are not required to be physically present for the registration of the SPV and all documents are to be submitted online through the ADGM portal.
Do the shareholders have to be physically present to apply for the licence?
The application for registration of an SPV is online. The shareholders are not required to be physically present for the registration of the SPV and all documents are to be submitted online through the ADGM portal.
Can I use an existing company name for ADGM entity?
The name of the Abu Dhabi Global Market (ADGM) entity must be in compliance with ADGM Companies Regulations and Business and Company Names Rules 2016. Furthermore, you will need to show proof of ownership of the proposed name through the trade licence of the existing company whose name is proposed to be used or letter of consent signed by shareholder/s to use the name of the entity.
Are there any ongoing obligations for the company?
The Abu Dhabi Global Market (ADGM) requires a Special Purpose Vehicle (SPV) to comply with the following on an annual basis:
-Maintain office address in the ADGM premises
-Renew data protection
-Renew commercial licence
-File annual returns
-File annual accounts
Why do I need a Company Services Provider (CSP)?
With the implementation of CSP Framework that came into effect on 12 April 2021, non-exempt Special Purpose Vehicle (SPVs) and foundations requires the appointment of an ADGM licenced CSP.
How much is it going to cost?
To set up a business consultation and receive an estimate of the timeline and cost, please reach out to us on formations@cbdcorporateservices.com
What are the most popular business setups for foreign investors in Saudi Arabia?
Foreign investors can opt for a Limited Liability Company (LLC) or a Branch of a Foreign Company when establishing their business in Saudi Arabia.
Can companies in KSA be 100% foreign owned?
Yes, except for the following activities: Insurance, real estate and public transportation.
Certain activities are also exclusive to Saudi nationals and KSA government, such as: oil drilling, mining, recruitment, security and manpower.
What are the taxes levied on businesses?
VAT – 15%
Corporate tax on non-Saudi entities – 20% on net profit
Zakat or Islamic Wealth Tax – 2.5% of net profit, applicable to all companies
What is the timeframe for company incorporation in Saudi Arabia?
Depending on the activity type and ensuring the right documents are submitted, the approximate timeline for licence issuance can take up to 2 months.
What is Iqama?
An iqama is an employment visa, is issued to expatriates who arrive in KSA with an employment visa. This is currently set at one year for work at private companies, but there is an option to renew the permit after one year. For the nominated General Manager, iqama is issued once the Commercial Registration is issued.