What is a Limited Liability Company (LLC)?

Setting up as an LLC is a popular choice in the UAE. This type of business entity limits your personal financial liability, offering protection if things don’t work out in the future. There’s no minimum capital requirement either, which is another big advantage.

If you want to set up an LLC business, you will need a local sponsor, and they’ll be required to own at least 51% of the shares. This can be achieved by using a local Emirati partner or through one of the many corporate sponsorship structures that are now available.

What are the benefits?

Onshore LLC companies within the UAE are required to be licensed by the Department of Economic Development (DED). There are multiple ways that licensed companies can be formed, but LLCs are the most common because they are less restricted than other forms and allow physical trading within the UAE. Here are some of the benefits of setting up an LLC in Dubai:

  • 0% income tax
  • An LLC can legally trade anywhere in the UAE, including in Free Trade Zones
  • The company can have anywhere between two and fifty shareholders
  • Each shareholder’s liability is limited to their shares in the company’s capital
  • An LLC can conduct any type of business activity except for banking, investment, and insurance
  • Investors can become venture partners
  • It is easy to open and maintain international corporate bank accounts
  • More business branches can be formed than with other company types
  • An LLC can buy and hold any amount of property in the UAE
  • An LLC can provide as many flexible resident visas as necessary to relevant personnel

There are additional benefits to LLCs that may apply to your industry, or the area in which your business is set up. If you would like to learn more about how the benefits of forming an LLC would apply to your business, you can schedule a call with us to discuss things in more detail.

Who can have a Dubai LLC?

An LLC offers foreign investors a lucrative opportunity to begin a business in areas across the UAE. There is a government mandate that requires 51% of shares to belong to a local partner who is a UAE national or through a corporate sponsorship structure. This local shareholder can be a silent partner, and a legal agreement can be drawn up to say that the silent partner will not have the authority to control business decisions. Having a local partner can also be a benefit to the company, as foreign investors can learn from their knowledge of the UAE markets and business regulations. This can give you an advantage over companies that are solely comprised of foreign investors.

Incorporating an LLC gives foreign investors (and their immediate families) access to UAE resident visas. There is no limit to the number of visas an LLC can obtain (subject to the business having sufficient office space), allowing you to build your company without restrictions. Under the new UAE Commercial Companies Law, an LLC can be formed with anything between one and fifty investors, so you can build your company as you grow. It is common practice for foreign investors to have a minimum of two shareholders, however, in order to have the required 51% ownership by a local partner.

An LLC can be utilised? by any business except for those involved in banking, investment, or insurance. LLCs can hold any of the three types of business licences available in Dubai; commercial, professional, and industrial. In order to incorporate an LLC, approval must be sought from the Company Register, Licensing Department, and Department of Economic Development. At Charterhouse Lombard, we understand what is required to establish an LLC with each of these government bodies and can arrange all the documentation you need to register and begin trading under your LLC. We also offer ongoing administrative management services, ensuring that your business is always compliant with Dubai regulations.

How to set up an LLC in UAE

Setting up your LLC is a relatively straightforward process. Here’s a step-by-step guide of what’s involved:

  • First, you’ll select the name of the company / specify what business activities you’ll be undertaking (in the application form).
  • We will then have to obtain initial approval on your behalf, and certain legal procedures will need carried out (e.g. legalising corporate documents like a Memorandum).
  • Then, we will need to submit the necessary documentation to obtain your licence.
  • Please note - some business activities may require additional approval from the authorities.
  • Your visa will need to be processed too, once the Establishment Card and Labour card has been obtained.

Frequently asked questions

What documents will I need?

To register your LLC business, you’ll be asked to provide the following:

  • A copy of your passport
  • A copy of your local sponsor’s passport (if applicable)
  • A copy of your manager’s passport (if applicable)
  • A completed registration application form
  • The reservation of your trade name
  • The tenancy contract for your premises in UAE
  • NOC letter from your sponsor (if you have a residence visa in the UAE)

How much will it cost?

The exact cost will depend on the nature of your business, and its location. There are a variety of fees involved with setting up an LLC in UAE, such as investing in a trade name and obtaining initial approval – these are both modest costs. Things like renting your premises on a yearly basis and obtaining a licence fee will require a more sizeable sum of money. However, the overall price is competitively low, given the benefits of establishing a company in this area.

How long will it take?

It takes a bit longer to set up an LLC than it does a company in a free zone. On average, expect the entire process to take eight to 10 weeks.

Are there tax advantages?

There certainly are, and you’re entitled to apply for a Tax Residence Certificate, for the company after a qualifying period, similarly Individual Tax Residency Certificates can be obtained

What are the licences?

You can choose either a commercial, industrial or professional licence.

Is help available?

Charterhouse Lombard are on hand to assist with all stages of the process. You can find out exactly what we do by reading the section below. 

How can Charterhouse Lombard help?

Charterhouse Lombard have years of experience helping foreign investors set up LLCs in Dubai and the UAE. We have thorough knowledge of the incorporation process and can provide you with advice tailored to your situation. Our expert consultants will advise you on the correct legal structure you should follow, based on the activities your business will be undertaking. By understanding your business, we can help you to navigate the LLC process in the most beneficial way.

Charterhouse Lombard can arrange all the necessary documentation for the LLC process, including those surrounding the procurement of visas and set-up of UAE business bank accounts. We can also help you to find a local UAE partner in order to fulfil government shareholder requirements. We will take care of all the required steps concerning documentation, including mandatory translations into Arabic and notarisation. We will manage the application process at every stage, taking care of all administrative points so you can focus on starting your business. You can contact us at any time to learn how Charterhouse Lombard can help you set up an LLC.