In a limited-liability company, the minimum number of shareholders is two and the maximum is 50. The liability of shareholders is limited to their shares in the capital. The company may carry on any type of activities except insurance, banking, or money investment. In UAE, The minimum capital requirement law was abolished on 10th August 2009. The memorandum of association must include the following:
Trade name of the company, its objectives, head office, duration, names of shareholders, their nationalities, addresses, and places of residence; and Amount of capital, share of each shareholder, and a statement of capital paid in kind (if any), names and nationalities of the company managers, distribution of profits and losses which may not necessarily be in the same proportion as the capital, and the adopted method of notification.
In Dubai, Capital Deposit rule has been cancelled. i.e. Limited Liability Company can be formed without Bank Deposit Certificate and Auditor Certificate. In Abu Dhabi, minimum capital requirement is Dh150,000. The manager of the company will be allowed to operate the account as soon as the incorporation is completed. The Manager of the company can be more than one and he/they shall have all administrative and financial powers. A shareholder may transfer his share in the company or part of it to another shareholder or to a third party. Management is handled by no more than five designated managers, who are not necessarily members of the company. Non-UAE nationals may own up to 49 per cent of an LLC.
In distribution of profit and loss, foreign investor can have 80% and 20% local UAE sponsor.
It is imperative that each limited-liability company appoints auditors to satisfy the requirements of the Commercial Companies Act. The law does not permit this form of company to issue share certificates. Evidence of ownership in the company is related and evidenced by the percentage contributed, assigned, or transferred in the share capital.
A larger portion of Dubai Limited Liability Companies use the local UAE sponsor as a “silent partner”. In this arrangement, the local UAE sponsor is usually paid an annual “sponsorship fee” in return for giving up management control of the company to the foreign investor.
First: Documents required for Initial Approval
- Registration and licensing application, as well as proof of reserved trade name.
- Photocopy of applicant’s passport (together with residence permit / visa details for non-GCC states nationals).
- Photocopy of applicant’s naturalization identification for UAE nationals only.
- No-objection letter from the applicant’s current sponsor for non GCC nationals.
- Photocopy of the director’s passport, and no-objection letter from the director’s current sponsor.
- Permission from the court to practice business, for applicants under 21 years.
- Approval issued by other Government authorities according to the type of activity.
- The Company’s Board of Directors resolution to subscribe to the new company if the partner is an existing corporate entity in UAE or abroad (the resolution must be attested by UAE embassy / consulate or by a GCC state embassy / consulate and UAE Ministry of Foreign Affairs, and duly translated into Arabic).
Second: Documents required after getting the Initial Approval
- Initial Approval receipt
- All documents submitted before in order to get the Initial Approval.
- Photocopy of office lease including the plot number.
- Original photocopy of the Memorandum of Association duly authenticated by the Notary Public.
- Contract of Limited Liability Company
- If the partner is an existing corporate entity in UAE or abroad the Memorandum of Association and the Commercial Register Certificate must be attested by UAE embassy / consulate or by a GCC state embassy / consulate and UAE Ministry of Foreign Affairs, and duly translated into Arabic).
Trade License Cost for General Trading (approximately)
Commercial License Fees AED 700
General Trading activity special fees-once only (this amount is not applicable for other trading activities) Renewal Fees (General Trading special): Dh3000 AED 15000
Government Cultural Fees AED 10
Administrative Fees AED 50
Non-Arabic Trade Name Fees (Dh2000 extra fees for words like Emirates, Gulf, International, Abbreviation. Maximum Trade Name Fees: Dh3000) AED 3000
Name board permission Fees AED 350
Market Fees (5% of your shop/office rent) amount varies depends on tenancy amount AED 1250
Partner Accommodation Fees (Dh500 for each expatriate Partner). If any of the partner paid his accommodation fees with any other license, you can approach DED to remove his fees after get issued the Payment Voucher AED 1000
Public Waste related service fees AED 1000
Service Improvement Fees (Commercial) AED 400
Chamber of Commerce Fees AED 1200
Ministry of Economy Fees AED 3000
Local Fees – Trade License AED 200
Commercial License Fees-Tejari AED 150
Total License cost (approximately) AED 27310