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Company Formation UAE -Company Formation United Arab Emirates (UAE): Abu Dhabi

Company Formation United Arab Emirates (UAE): Abu Dhabi

Why form a company in a foreign country with a tax accountant specialized in international tax law?

Company Formation Abu Dhabi: Licensing Procedures

Registration of New Membership

  1. Trade Name Approval issued by the Department of Planning & Economy
  2. Photocopy of :
    • Passport
    • Tenancy Agreement
    • Specimen Signature duly attested by the Notary Public
    • Amendment in the Ownership or Services Agency Agreement
    • License & Approval Issued by the Competent Authority ( Department of Planning Economy – Abu Dhabi Tourism Authority – Higher Corporation For Specialized & Economic Zones

Renewal or New Branch

  1. Photocopy of:
    • Passport
    • Tenancy Agreement
    • Specimen Signature duly attested by the Notary Public
    • License & Approval Issued by the Competent Authority Department of Planning  Economy – Abu Dhabi Tourism Authority – Higher Corporation For Specialized &  Economic Zones
    • Original Membership Certificate

Alteration & Modification

Trade Name

  1. Photocopy of:
    • Trade Name Approval issued by the Department of Planning & Economy
    • Tenancy Agreement
    • Amendment in the Partnership Agreement  Modifying in the Capital
    • Advertisement in the Newspaper
    • License Issued by the Competent Authority with change of Name ( Department of Planning  economy – Abu Dhabi Tourism Authority – Higher Corporation For Specialized &  Economic Zones
    • Original Membership Certificate

Relocation

  1. Photocopy of:
    • Tenancy Agreement for the new Location
    • Alteration of Trade Name in the Partnership or Services Agency Agreement  ( Department of Planning
      Economy – Abu Dhabi Tourism Authority – Higher Corporation For Specialized &  Economic Zones
    • Original Membership Certificate

Ownership Alteration

  1. Photocopy of:
    • Amendment in the Ownership or Services Agency Agreement
    • Advertisement in the Newspaper
    • License Issued by the Competent Authority with Change of Name Department of Planning  Economy – Abu Dhabi Tourism Authority – Higher Corporation For Specialized &  Economic Zones
    • Original Membership

Capital Alteration

  1. Photocopy of :
    • Amendment in the Partnership Agreement  Modifying in the Capital
    • License Issued by the Competent Authority with change of Name  Department of Planning  Economy – Abu Dhabi Tourism Authority – Higher Corporation For Specialized & Economic Zones
    • Original Membership Certificate

Foreign Company Branch

  1. Trade Name Approval issued by the Department of Planning
  2. Economy Service Agent Agreement duly legalized by Notary Public&
  3. License Issued by the Department of Planning & Economy
  4. Approval Letter from Ministry of Planning & Economy
  5. Decision Board of Directors
  6. Specimen Signature duly attested by the Notary Public
  7. Passports of the Resident Representative & Service Agent
  8. Service Agent Agreement duly legalized by Notary Public
  9. Documents issued from the Mother Company must be duly legalized by the  Concemed Authority & UAE Embassy from the Count

Company formation Dubai /UAE- Introduction/summary

Dubai has a unique set of selling propositions, namely:

  1. No corporate tax
  2. No income tax
  3. No capital gains tax
  4. No property tax
  5. No wealth tax
  6. Low property transaction cost
  7. Ease of access to home finance

 Dubai/UAE has double taxation agreements = DTA with most other countries. EU freedom of establishment is not applicable. For approval of the permanent establishment according to tax laws, a commercially equipped business operation must be installed in Dubai/UAE, and active business must be transacted in UAE/Dubai.

Since only oil companies and banks are subject to taxation in the UAE/Dubai, and any other companies do not pay any taxes, this results in interesting opportunities for investment in Dubai/UAE. In order to be able to use the tax advantages, a permanent establishment according to DTA must be installed in Dubai. On the one hand, a Dubai company is no offshore company in this sense, since the UAE/Dubai also maintain double taxation agreements with many countries – including Sweden and Denmark – but on the other hand, the EU freedom of establishment is not applicable. Therefore, the following prerequisites for approval of a permanent establishment according to tax laws in Dubai must be met:

  • Place of management: A manager resident in the UAE/Dubai according to tax laws must – at least on the outside – control the company’s businesses.
  • There must be a commercially equipped business operation, i.e. at least one office and one employee.
  • It must be demonstrated that the Dubai company does actively transact business in the UAE.

Under the stated conditions, for example the Swedish could be a majority shareholder of the Dubai company, but nevertheless Dubai/UAE has the sole right of taxation, provided that the Articles of Association state that all relevant decisions are made at the shareholders’ meetings, which exclusively take place in Dubai, at which the Swedish shareholder must be present. However, the UAE company law stipulates that 51% of the company shares must be held by persons resident in Dubai. As a rule, the founder will use a “sponsor”. This requirement may be omitted in case of company formations in the free zones. In the free zones, 100 % of the shareholders may be foreigners.