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In order to stimulate investment, the UAE offers integrated services that allow companies to carry out their foreign trade operations. This made many large and medium companies interested in investing in the UAE, as projects can be implemented through offshore companies.

Dubai government allows investors by establishing foreign companies who want to enter into new projects, but do not want to work from their headquarters in their countries. Under these companies, they are able to carry out multiple activities without any hindrance.

What are offshore companies?

Many commercial companies do business in countries other than their own, mostly because of the generous investment incentives offered by those countries. What is meant by “offshore companies” if we take the term literally? If we mean companies that are registered under the law of the country you operate from, this applies to all offshore companies. However, if we mean companies registered outside the borders of the country, then offshore companies are those companies registered under the law of a country outside the country.

Foreign companies are also legal business entities or group companies that provide and manufacture business services outside the borders of their own countries. Companies that invest in offshore oil and gas extraction fields may do so under this name.

Features of offshore companies:

Offshore companies, whether commercial or not, are subject to the relevant laws and regulations of the country. They are tax-exempt by the state in which they operate, have more flexibility when it comes to trading systems, and enjoy many other benefits not available to other companies.

In the Emirate of Dubai, owning an offshore company is not against the law, but it requires knowing and understanding the true nature of these companies, the source of their financial flows, and who ultimately benefits. In light of this, and in accordance with the legislation approved by the authorities, it is possible to establish an offshore company in the Jebel Ali Free Zone - for service and commercial activities.

Offshore companies validity:

An offshore company is a legal entity with the same power, rights and privileges as a natural person. What are offshore companies?

Offshore companies have no restrictions on the activities they can undertake, as set out in their articles of association. They are not bound by any laws or regulations that apply to normal companies.

Offshore companies cannot do business with people who live in the country where they reside, nor may they own any property there. In addition, they are not allowed to own any real estate or engage in banking activities.

An offshore company cannot engage in insurance and reinsurance business, or an insurance agent or broker. No other business may be practiced without a license from the Authority. The offshore company does not deal with persons residing in the United Arab Emirates. If an offshore company wishes to engage in trade or any other business in the UAE, it must obtain a license from the relevant authority.

What are the conditions for establishing an offshore company?

To set up an offshore company in Dubai, you need to follow the appropriate steps. According to the regulations issued by the Jebel Ali Free Zone Authority, any one or more persons can apply for Offshore Limited Incorporation Certificate limited liability. An offshore company may be incorporated in any legal business except as provided in the regulations. Each offshore company must have a management structure and one class of shares of equal value. An entity wishing to conduct business must obtain a license from the relevant authorities.

Each company must comply with the regulations prescribed by the competent authorities from time to time. Offshore companies are not authorized to engage in banking or insurance business, as determined by TB Competent tat. In order to start a company, you must submit an application to the Registrar of Companies including the following information:

  1. Your company name (Alf Shore Company, for example), which must end with the word "Limited"
  2. The address of your registered office, as well as the purpose of setting up your company (for example, to provide services such as banking and insurance)
  3. The nature of your business (eg, work).

The following are the details of the capital proposed to be registered and divided into shares in a fixed amount:

If your company name is misleading or difficult to understand, it should be changed. If you do not comply, your company will be in violation of this Code.

If the Registrar refuses to register an offshore company, there is no right of appeal or review. If the registrar agrees to register, the platform is registered. When registering an offshore company, the registrant must provide a certificate of registration that includes the name of the offshore company and its registered number. A corporation can change its name as long as it is approved by the Registrar. The new name will be registered in the registry and a certificate of incorporation will be issued in accordance with the new name. Any actions taken by or against the Company under its old name will remain in effect. Changing your company name is a great way to refresh your brand and attract new customers.

If your company name is misleading or difficult to understand, the Registrar requests that it be changed. If you do not comply, your company will be in violation of this Code.

If you wish to change your corporate name, please submit an application to the Registrar within one month of the date these Regulations are issued or as the Registrar may permit. If you do not comply with these directives, your company will be in violation of this Code.

Licenses cost and types:

The cost of issuing a trade license in Dubai South is thousands of dirhams, in addition to other fees such as registration fees, virtual office or rent, professional fees, annual renewal fees, etc. Dubai South authorities also offer lump sum packages according to your business needs .

An industrial license is required for activities involving light industrial production. A logistics license is required for activities that involve carrying out logistics services. A general trading license is necessary, import, export, distribute and store the products specified in the license and sell the products within the UAE market through a local distributor.

Service License: This license is valid for specified services within the Dubai South Free Zone and anywhere else in the UAE.

Education license: This license is used for educational, social, training and educational advisory services.

Establishing a company in Dubai:

Setting up a company in Dubai can be a lucrative venture, but it is important to consider the costs involved. The government provides various tax breaks for companies operating in Dubai, but a license fee must also be paid. The Department of Economic Development website offers a useful tool that allows entrepreneurs to estimate the costs of obtaining licenses for their business.

The most important reasons that encourage investment in Dubai:

Dubai is the most important investment center in the world, as it attracts many foreign investors from different nationalities and countries of the world. Here are the most important reasons for you to invest in Dubai

  1. Economic stability, as the UAE ranks first economically in the Middle East
  2. The investment facilities it provides in the field of investment, from access to electricity, building permits, to contracts and property registration
  3. A lot of facilities and commercial and industrial centers are available here
  4. Cultural diversity through the possibility of communicating with all nationalities in both Arabic and English and the availability of skilled labor
  5. The United Arab Emirates enjoys political stability, which leads to huge profits for all investors, whether Arab or foreign

These are the most important reasons that attract all investors from all over the world to the United Arab Emirates. For more information, you can contact the Etqan team of experts and consultants. Contact us now and set an appointment for an interview with our specialized team and consultants in all fields, and you can discuss all the details of of establishing Company in Dubai or any business or commercial activity you would like to start.

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As a leading company formation and business solutions provider in Dubai, ITQAN team of business consultants can help you expedite the process of setting up your company as well as reserving a trade name. You can count on ITQAN to complete all the procedures for establishing a company in Dubai in record time if all your documents are ready, without hidden fees and in a hassle-free process.

Mohammed Hamza – CEO