COMPANY REGISTRATION IN THE DOMESTIC MARKET

According to UAE legislation, the form of company registration may vary and depends on its location. For example, a store in a mall, a supermarket, a restaurant or a clinic may require only registration in the domestic market.

All domestic companies can be grouped into commercial enterprises, professional or civil companies and representative offices of foreign organizations.

According to commercial law of UAE, 51% shares of commercial enterprise should belong to a UAE citizen or to a citizen of the GCC countries.

A local partner is entitled to have no less than 20% of company profits. It is stipulated in the Memorandum of Association. In real life, majority of local partners are “sleeping partners”, i.e. not actively taking part in any activity of the company or distribution of income. They only get a fixed annual remuneration.

There is also a practice of the so-called “side agreements”. It is when a local representative (Emirati) signs a contract with foreign partner in which he confirms in written he has made no contribution to the company and does not claim any share or profit of it. Due to the fact there is no UAE legislation providing for the conclusion of such agreement, it cannot be notarized. So, this document is not legitimate. The registration procedure consists of obtaining an initial approval from registering body and in some cases from the third parties (external ministries and departments) prior to the registration. The Memorandum of Association must always be notarized.

To register a commercial enterprise the passport copies of the shareholders will suffice, but in some cases additional documents may be required, such as: good conduct certificates, proof of work experience, attested diploma etc.

We assist our clients to set up a legitimate system to secure their company assets and provide a turn-key solution for your new company incorporation in the UAE local market.