Description of the main considerations for registering a business in the UAE

In order to register in the United Arab Emirates, enterprises need to accurately grasp the characteristics of its "two-track system of local and free trade zone", take into account the differences between federal regulations and local policies, and respect Islamic cultural customs, in order to complete the registration efficiently and expand their business by relying on their geographical advantages. The following Zhuo Xin Xiaobian for you to introduce in detail the main matters needing attention in the UAE registered enterprises.

UAE registered company notes

1, Business Environment Analysis

as a trade hub in the Middle East, the UAE is famous for its free port policy, low tax environment and convenient logistics system. Cities such as Dubai and Abu Dhabi are important gathering places for global capital. The government promotes the development of emerging industries such as digital economy and green energy through the "UAE 2071 Vision". Free trade zones (such as Dubai International Financial Center DIFC and Abu Dhabi Global Market ADGM) have introduced preferential policies such as 100 foreign ownership and no corporate income tax. However, the market is significantly influenced by religious culture, the time of business activities during Ramadan is shortened, the competition in luxury goods, tourism and other fields is fierce, the local consortium resource integration ability is strong, foreign enterprises need to find the right subdivision track to cut in.

the legal framework follows

the UAE's federal laws run parallel to the local statutes of the emirates, and the FTZ has an independent judicial system. The commercial sector is subject to federal regulations such as the Business Companies Act and the Labor Act, while the FTZ applies its own special regulations. For example, local companies (non-FTZ) need to be held by UAE nationals at least 51%, while FTZ enterprises can be wholly foreign-owned. In terms of taxation, there is no corporate income tax at the federal level (except for special industries such as oil and banks), and the standard VAT rate is 5%. Labor laws and regulations specify employees' rights and interests such as paid holidays and overtime pay. Enterprises are required to pay medical insurance and pension insurance for their employees.

3. Company type choice

the types of enterprises in the UAE are divided into two categories: "local companies" and "free trade zone companies. The common local type is limited liability company (LLC), which requires UAE nationals to hold ≥ 51% of the shares and shareholders to bear the responsibility within the limit of their capital contribution. It is suitable for deep cultivation of local retail, trade and other markets. There are many types of companies in the free trade zone, such as DIFC's private limited company (FZE) and ADGM's private joint stock company (Private JSC), which supports 100 percent foreign capital holding and has no foreign exchange control, suitable for cross-border trade, financial technology and other enterprises. In addition, professional service enterprises can register professional companies (Professional Company) and need to cooperate with local service organizations.

4. Determination of business scope

the business scope must be clearly marked at the time of registration and match the company type and registration area. Local companies are prohibited from engaging in some sensitive industries, such as religion-related services. The free trade zone has looser restrictions on the scope of business, but it still needs to meet the park's positioning. For example, DIFC focuses on finance and professional services, while Dubai Silicon Valley Free Trade Zone focuses on technology industry. Energy, medical and other industries need to obtain the approval of the relevant federal ministries, some industries such as education, media need local qualification endorsement.