Best-in-class Offshore Company Registration in Dubai

Registering a company in Dubai involve a number of considerations and the process slightly differs for the type of company that one is dealing with. In this article, we are going to focus on the registration process of an offshore company in Dubai. An offshore company is a company that is operated and managed outside the company where it is registered. Passport sized copies of the nominated shareholders and directors of your company are the primary requisites for the registration process. Then comes the bank recommendation or reference letter followed by the confirmation on residential addresses of the shareholders. We have explained these components in detail in the remaining part of this article.

Benefits of Offshore Company Registration in Dubai:

Take a look below at some of the benefits of the offshore company registration in Dubai:

• Exemption from Corporate Taxes

Till now no personal tax or corporation tax is imposed on establishing an offshore company in Dubai. But, certain commodities like liquor and tobacco are some exceptions as municipal fees and duties are imposed on them.

• Complete Foreign Ownership

Local shareholding is mandatory for a company incorporated in the mainland of UAE. But, local sharing does not apply to offshore companies as per international companies regulations. Therefore, foreign investors can own 100% share equity in offshore companies.

• Low Operational Cost

Offshore companies do not require registration in terms of leasing of premises or employment of staff. Offshore companies are free to conduct their business through the offices of registered agents. Furthermore, the incorporation cost is relatively low with respect to other entities incorporated in free zones or mainland of individual emirates.

• Transferability of Shares

You can freely transfer the shares of an offshore company with the help of a written instrument.

• Limited Liability

The liability of shareholders in an offshore company is equivalent to the face value of the shares they hold in that company.

Points to be Taken Care of During Offshore Company Registration in Dubai:

Before proceeding further with the Offshore Company Registration Dubai, verify the name of your company with the Registrar. Make sure that your company name does not include the word: insurance, bank, Royal, chartered, Emirates, Municipal, Chamber of Commerce, and so on. Also, either the word ‘Ltd’ or ‘Incorporated’ is included at the end of your company name. It is not obligatory for offshore companies to reflect their activities through their name. Shareholders and directors of the company need to be physical persons as well as legal entities. Besides this, they should be beyond any limitations on residency or citizenship in Dubai.

Complete Procedure of Offshore Company Registration in Dubai:

We have broken down the entire process in four simple steps as shown below.

Select the Business Entity

At the initial stage, decide whether you want to operate as a sole proprietor, a partnership, a full-fledged corporation or a limited liability company. Consider the tax and liability considerations before choosing the business structure. Along with this, emphasize the significant issues concerning the day-to-day management and control of your business. After that, select the persons who are going to be your local partner, that is the sponsor of your business. The services you would expect determines the selection of the sponsor for your business.

For instance, you might like the sponsor to assist you in resolving problems with government procedures. On the other hand, you might want nothing except his name on the license of your company. Then, decide the fees you are prepared to pay per year. If you are clear about all these factors, then you won’t have to face potential problems.

Register the Business Name

Choose a name and submit it on a standard application form at Department of Economic Development(DED). Skip this step if you are using your precise legal name as a sole proprietor. Check the databases of Dubai for the names that have already been taken by some other entities. If you repeat the same name, then your registration will be rejected by the Department of Economic Development.

Obtain an EIN Number

EIN is the abbreviation for Employer Identification Number that you need to obtain before commencing your business. It is not required for a sole proprietorship business as it does not contain any employee except the owner himself. But, the number is essential even if you have a single employee in your company. You can obtain the number online. The EIN number becomes more essential if your company deals with special products such as liquor or tobacco. It then becomes necessary for the purpose of deciding upon the tax.

Prepare a Tenancy Contract and Memorandum of Association

It is mandatory for all business in Dubai to have their business premises evidenced by a tenancy contract. Look for your business premises and then prepare the tenancy contract accordingly. After creating the tenancy contract, develop a Memorandum of Association with your sponsor and submit it to DED. The MOA shall specify the percentage of ownership among all the partners of your business. You can prepare the memorandum with the help of a legal firm. Then submit the Memorandum of association, license application along with the necessary legal documents and tenancy contract to DED. Make a note that you will need to pay all the charges at this stage only. It would take about a week to get the license for your business.

Acquire Licenses and Permits

After obtaining the licenses, get it approved by the UAE central bank, in the case of banks and other financial institutions. For manufacturing companies, you shall approve the license from the Finance and Industry Ministry. Whereas, the Economy and Commerce Ministry is going to approve the license for companies engaged in insurance and other related firms. Approach the Health Ministry for the approving the license for medical and pharmaceutical products. You will need to resort to other governmental agencies for approving the license of your company engaged in gas or oil production. The Dubai Chamber of Commerce and Industry plays has the maximum involvement above all these ministries. It ends the process of Offshore company registration in Dubai.

This article has clearly described all the essentials important for offshore company registration in Dubai. Therefore, follow the steps and apply them carefully to register your company successfully without any difficulties.