Terra Nova Real Estate

    Company Formation in Dubai | Local Company LLC

    What are the advantages of a local LLC?

    • You can trade operationally in all zones (so you can show market presence)
    • Limited liability (comparable to a LLC in Switzerland or Germany)
    • No corporate income tax
    • No minimum share capital requirement (However, the authorities recommend a minimum capital of AED 50,000). However, for certain activities there is a prescribed minimum share capital, which can be higher than AED 50'000).
    • Obtaining an investor visa (valid for 2 years)

    What are the disadvantages of a local LLC?

    • 51% of the shares must be owned by a local Emirati partner (a so-called sponsor)
    • Office space is required
    • VAT taxable (5% VAT)

    Usually an agreement (so-called sponsor agreements or "partner agreements") is made between the local sponsor and the founder of the company. For example, it is stated that the profits and control of the company remain with the foreign partner (i.e. the company founder). It can also be agreed that the local sponsor will not have access to the bank account. We work with local sponsors and can of course help you in this matter.

    It is also advisable to define the object of the company precisely in advance, as this determines the area of activity and this must be approved in advance. Depending on the field of activity, special regulations and certain exceptions apply. However, apart from the prohibition in the banking, investment or insurance sector, there are basically no restrictions. We work together with local lawyers and can provide you with optimal support in this area as well.

    Especially if you want to operate a company in Dubai, the formation of a local LLC is recommended. In a Freezone there are restrictions on offering or selling products outside the Freezone (more on an LLC in a Freezone).

    We guide you from A to Z through the formation of the local company and also guide you through the entire visa process including medical testing.

    The above price includes the cost of an investor visa and our all-inclusive cost of AED 10,000.

    A detailed cost overview can of course be worked out on request.