Dubai is one of the Middle East’s most cosmopolitan and affluent cities, having characteristics of both Eastern and Western countries. Giving start-ups a good revenue percentage, several business owners consider this destination as the most attractive and economical spot in the world for business. This is exactly why several Limited Liability Companies are the most common form of business in the UAE. Let’s explore in detail these companies and the cost of LLC company formation in Dubai, what is an LLC company in Dubai, the procedure of LLC Company formation in Dubai, LLC license in Dubai and more.
What is LLC in Dubai?
A Limited Liability Company or LLC Company in Dubai is a business structure that offers the personal liability protection of a corporation. The liability of the company limited to the company only or upto the shareholder capital of the company. It can be formed by at least 1 shareholder to maximum of 100 shareholder as per the new amendment of law no 2 of 2015 in UAE commercial companies. These members have limited liability to their shares in the business capital. In such companies, now days from June 2021 foreign national or any individual person or the corporate entity can become 100% owner of an LLC company without appointing UAE national in the company as 51% shareholder of the company. LLCs are the most common type of company in the UAE mainland.
The Department of Economic Development (DED) government issues LLC license in Dubai and is accountable for categorizing and regulating the types of economic activities that may be undertaken. Such companies do not have any minimum share capital requirements. Such companies are an easy way to structure the business to secure your personal goods. They have a flexible management structure, offer liability protection, and have certain tax advantages as well.
Why Setup LLC Company in Dubai?
An LLC license in Dubai offers several advantages to business owners as a standard. However, the benefits become greater when such companies are formed in Dubai. Therefore, several smart entrepreneurs prefer LLC company formation in Dubai due to the following advantages:
- A Limited Liability Company provides the advantage of limited liability to the shares in the capital.
- LLCs have the leverage to conduct any business activity except for banking, insurance, and investment.
- LLCs can legally trade anywhere in the UAE including the Freezones.
- There are no restrictions on the location where the company buys or rents office premises.
- LLCs can obtain several visas as there are no restrictions on them.
- The DED government has officially waived off paid-up capital requirements on LLCs.
- Easy process of opening bank account of the company
- Maximum visas under the company even with small or virtual office.
- International recognition of the company.
What Are the Requirements for Forming an LLC in Dubai?
Documentation is one of the mandatory requirements of an LLC company formation in Dubai. Below are the required documents to form an LLC. We have presented the standard ones as the requirements greatly vary depending on the business nature.
- Certified passport copies for all shareholders and managers
- Copy of the UAE residence visa (if required)
- NOC from current UAE residence visa sponsor
- Three Name choice for company name reservation
- If a corporate entity becomes a shareholder, the business owner will also have to submit the below documentation.
- Certificate of incorporation
- MOA/AOA of the company
- Board of resolution of the company
- Appointment of manager in proposed company
- All above documents must be notarized in the country of origin and get attested in UAE Embassy of that country.
How Does LLC Company in Dubai Works?
Entrepreneurs who choose to start their LLCs in Dubai can enjoy various advantages. However, the process is time-consuming. Investors have to get in touch with various departments and also prepare various documents, making it a lengthy and comprehensive process.
Here are the important steps that are required to carry out the whole procedure of LLC Company formation in Dubai.
- Step No. 1: Select a Name
Investors must choose the name of the organization and the types of activities that the LLC will practice.
- Step No. 2: Choose a Location
Another mandatory requirement after selecting the name of the organization is choosing the location. The place should be selected suiting according to the business type. The operations of the company must be carried out through a virtual or physical office/warehouse.
- Step No. 3: Choose Business Activity
For any company registration in Dubai choosing the right activity is very important. Get assistance from Avyanco Business Consultancy LLC to choose right business activity of the proposed company.
- Step No. 4: Submit All Documents to DED
After choosing name, activity and location submit all documents to DED to issue an approval for the same.
- Step No. 5: Process of Approval for Activities
In case you are planning to form an LLC business that conducts specific activities, it will require approval from other relevant authorities.
- Step No. 6: Obtain Licenses
Once the relevant authorities approve the business activities, you can obtain a Memorandum of Association, Trade license, Tenancy agreement, Share certificates, Labor cards, Visas, Certificate of Incorporation, and other legal documents from the authorities.
How to Form an LLC Company in Dubai?
Forming a company in Dubai is a daunting process. Below time-consuming steps are required in its formation:
- Registration of the LLC company in Dubai with the Department of Economic Development
- Combining and authenticating the Memorandum and Articles of Association of the company
- Ensuring submission of all the required documents and business license application forms with the DED department
- Registering LLC Company with the Dubai Commercial Register.
- Once the LLC company is incorporated, get the employees registered with the relevant authorities
What Are the Types of LLC License in Dubai?
Business owners must understand that an LLC license in Dubai is mandatory to successfully form an LLC company in Dubai. An LLC license is a corporate document that certifies a company’s legal status. These licenses also safeguard, organize, and categorize the firm’s legal cases. If you wish to trade lawfully, obtaining a business or trade license becomes obligatory. This certification ensures that your business activities are in line with the UAE’s Commercial Firms Act. Following are the types of licenses available for the LLC in Dubai.
- Commercial License
These types of licenses are granted to companies that are involved in different kinds of trade activities related to goods, services, and other commodities. Some of the activities that come under the category of commercial license include car rental, logistics, and real estate brokerage.
- Professional License
Such licenses permit business owners and companies to engage in a specialized field. With this business license, individuals can form a business entity in which they are experts and have qualifications. Some common forms of activities that require a professional license include repair services, computer graphic design services, medical services, printing and publishing, beauty salons, artisanship, consultancy services, carpentry, security services, and many others.
- Industrial License
These forms of licenses are required for establishing manufacturing or industrial activity in the UAE. Business owners can assemble and process local or imported goods using raw materials with the help of this license. Those entrepreneurs who are planning to form an LLC in Dubai for textile, food, petroleum products, paper, metals, and equipment and engines must obtain this industrial license.
- Agriculture License
Business owners who involve in cultivation activities such as trading of pesticides, harvesting of crops, installation of greenhouses and others are accountable to obtain an agricultural trade license.
- Tourism License
As the title implies, businesses that offer tourism activities such as tourist camps, hotel renting, restaurants, cruise boat rental, guest houses, and travel agencies must acquire this tourism trade license.
The Cost of LLC License Cost in Dubai
The cost of LLC license in Dubai is between AED 15 000 to AED 30 000 and it may vary depending on your business industry and business activities you are planning to conduct.
What is the Cost of LLC Company Formation in Dubai?
The process of forming an LLC in Dubai and anywhere in the world is high-priced. Multiple steps that involve the costs including business registration, investor visa, employment visa, opening up a corporate account, and other government fees and taxes.
LLC Company Registration Cost in Dubai
The cost of company registration in Dubai is between AED 25,000 – AED 27,000. The fee varies based on the industry type and services.
Investors Visa Cost for a Dubai LLC Company
The investor visa costs for an LLC in Dubai is between AED 4500 to AED 5250.
Employment visa cost for an LLC Company in Dubai
The fee for issuing employee visa are in between AED 5000 to AED 7000 depending on type of business and category of employee.
How Avyanco can help you in LLC Company formation?
Equipped with dedicated industry knowledge and global reach, our LLC company formation experience enables us to help our client start business with ease and in no time. Team Avyanco takes a sincere approach to get you an LLC license in Dubai and offer an informed advice.
We take pride in saying that our business is founded on building strong connections by exceeding our client’s expectations. We make sure to provide superior services with the utmost care and respect to our clients. No matter if you are a startup in Dubai or a well-known worldwide brand; we will provide you with the same level of services.