A UAE person (or a corporation fully controlled by UAE nationals) must legally Free-Zone possess at least 51% of a limited liability company.
On the other hand, a branch will be wholly owned by the free zone entity and operate under the same name as its parent. A UAE local service agent will be needed once again; however, if the free zone entity is owned 51 percent or more by UAE residents, the Ministry of Economy will exempt the branch from employing a local service agent.
The local service agent is not liable for any legal or financial liabilities originating from the branch’s activities. The role of the local service agent is to guarantee that the branch can continue to do business in Dubai. However, he does not have a legal stake in the branch’s administration, operations, revenues, or assets.
Activities in Dubai that may be started
Although Law No. 13 of 2011 is silent on the activities that a branch in Dubai may carry out, there are some limitations in practice. The branch will also need to register with the Ministry of Economy, which has some limits on what operations a free zone corporation’s branch may engage in on the UAE mainland these rules are mainly adopted from federal incorporation canada
For example, the Ministry of Economy will not let a free zone company’s branch participate in trade, commercial agency, labor supply services, or restaurants.
- While the DED’s branch registration requirements appear to be less demanding.
- The DED issued a certificate of first approval and a trade name certificate.
- A copy of the free zone entity’s corporate documents, including a legally notarized resolution, allows the branch’s creation and a power of attorney in favor of the branch’s general manager.
- A copy of the general manager’s passport or, if the local service agent is a business, a copy of their license is required for both the general manager and the local service agent.
- I have notarized an agreement between a local service agency and a notary public.
- Ministry of Economy fees of AED 15,000 are required.
- Bank guarantee for AED 50,000 in favor of the Ministry of Economy
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The registration of a free zone company’s branch office involves both the DED and the Ministry of Economy. As a result, doing business in a free zone is genuinely efficient for all enterprises.
If you’re thinking of a free-zone business or have further quires, then reach out to reliable companies or experts of free-zone business worldwide. With the help of our pro tip, you can connect the world’s best economy experts, free-zone sponsors, and specialists from the ministry of economy.
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Absence of currency rules – Currency regulations are government-imposed limits on the exchange of foreign currencies. There are no currency restrictions in UAE-free zones. This facilitates financial transactions.
Import and export duty exemption – Import and export tariffs are not levied in the UAE’s free zone jurisdictions. This aids in the promotion of international trade.
Tax advantages – There is a complete tax exemption for free zone firms. This includes both personal income tax and corporation tax.
Advantages of repatriation – The firms are eligible for full repatriation benefits. Profits and financial assets are included.
Final Thought
I hope this demonstrated the advantages of starting a free zone corporation in the UAE. Working with a business setup specialist like Kiltons may help you get your firm up and running quickly and smoothly. Kilton’s can help you establish a corporation in any significant free zones in Dubai and the other Emirates.
Read more:Top Benefits of Online Shipment Tracking
