Free Trade Zones have been set up with the specific purpose of facilitating investment. The procedures for investing in the zones are relatively simple.
The Companies operating in the Free Zones are treated as being offshore, or outside the UAE for legal purposes.
The free zones are suitable for companies intending to use UAE as a regional manufacturing or distribution base, with the bulk of their business outside the UAE.
Limited Liability Companies
A limited liability company can be formed by a minimum of two and a maximum of 50 persons whose liability is limited to their shares in the company’s capital. Most companies with expatriate partners have opted for this form of company. In Dubai, the minimum capital is currently Dh. 300,000 (US$ 82,000), contributed in cash. While foreign equity in the company may not exceed 49%, profit and loss distribution can be mutually agreed. Responsibility for the management of a limited liability company can be vested in the foreign or national partners or a third party.
Professional Firms
In setting up a professional firm, 100% foreign ownership, sole proprietorships or civil companies are permitted. Such firms may engage in professional or artisan activities but the number of staff members that may be employed is limited. A UAE national must be appointed as local service agent, but he has no direct involvement in the business and is paid a lump sum and/or percentage of profits or turnover. The role of the local service agent is to assist in obtaining licenses, visas, labour cards, etc…
For further information on the above Company formations, please contact: info@firstoffshore.com