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Your International Business and Legal Advisor in the Middle East
Company formation
While starting a business in the United Arab Emirates, you have to be familiar with the concepts “mainland”, “freezone”, and “offshore”. Each jurisdiction has is pros and contras and ofers different business opportunities for entrepreneurs with different priorities. When it comes to setting up a business in the UAE or obtaining a business license, choosing the right type of business entity is one of the biggest considerations. Based on your business requirements and intended ownership structure, you can choose the most suitable type for your business. In the upcoming, please see the differences between the distinct company forms.
Mainland companies (onshore)
The mainland companies in the UAE are also called onshore companies. Their licence is issued by the Department of Economic Development (DED) of the choosen emirate. The mainland company can do business in the local market and outside the UAE without any restrictions.
Benefits of a mainland company:
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Unrestricted freedom to conduct business throughout the United Arab Emirates
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Allowed 100% repatriation of profits and capital
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Potential bid and work on UAE government contracts
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Number of visas are based on the rented office space
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Mainland companies can set up their office location anywhere in the choosen emirate and establish multiple company branches creating a solid presence in the local market.
Free-zone companies
There are more than 40 free zones in the UAE. It is incorporated within a designated jurisdiction of the emirate, where the company is allowed to do business inside the same free zone.
Most entrepreneurs, who want tax optimization, opt for a free zone formation as the free zone authorities bring out various benefits and incentives to the businesses set up in the zone.
Benefits of a free-zone compay:
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100% ownership
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Quick and easy company formation
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100% repatriation of cash and profits
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100% exemption from import and export tariffs
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Relatively simple recruitment policy
Off-shore companies
Offshore companies in the UAE are legal business entities established to operate outside their registered jurisdiction. Offshore companies are utilized for international business and financial activities, including trading, investments, and e-commerce. Offshore businesses are commonly established to take advantage of the favourable regulations in the Emirate, which encompass low tax rates, 100% foreign company ownership, and a progressive business ecosystem. An offshore company is established in another jurisdiction while its parent corporation is in another country. There is not physically presence in the registered country.
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Benefits of an off-shore company:
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Low taxes
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No minimum capital share
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Fast and simple incorporation process
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Asset protection
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Convenient and flexible bank account opening
