An Investor’s Guide Into UAE Company Formation
The UAE is a country that never shies away from the limelight. Aside from its vibrant spirit and appeal, it’s considered to be one of the most favoured destinations for foreign investment. Investors are attracted to the country for a multitude of reasons: its economic stability, innovation, strategic position and digital transformation, to name a few.
So, if you’ve got your eye on one of the Emirates and are looking to invest in the UAE, then the first thing you ought to do is decide which type of business you want to set up. In other words, you need to choose between the three business jurisdictions UAE offers.
Because no two investors are the same, these three jurisdictions have been designed to meet every investor’s needs.
Mainland, also referred to as ‘Onshore’, is any type of licenced business in the UAE. Whether you decide to set up a mainland company in Sharjah or Dubai, your company must obtain a business licence from the Emirate’s Department of Economic Development.
Mainland companies are alluring because they not only offer investors the opportunity to set up their operations in the UAE but also open the doors to international markets. Indeed, they might be on the upper scale in terms of setup costs, but it’s because they offer the ability to reach a wider audience.
With over 40 free zones in the UAE, what makes this jurisdiction attractive is that investors who decide to set up businesses in a free zone will not follow the UAE’s business rules and regulations. Rather, they will need to abide by their free zone’s policies. This translates to lower taxes and fees. And while investors enjoy 100% ownership, they can only operate inside the free zone itself and outside the UAE.
This jurisdiction is the most desired among international investors because of its various benefits. Offshore companies are businesses that are incorporated in a country different from the one they operate in. If investors register their companies as UAE offshore, they won’t need a physical space in the country. And while they may operate anywhere in the world, they aren’t allowed to conduct business operations within any of the Emirates. So, what makes offshores so desirable, you may ask? The fact that offshore companies enjoy low setup costs, privacy, asset protection and a no-tax jurisdiction.
For investors who are looking to set up a business in the UAE, it’s important to understand the three business jurisdictions to find the right fit for their business needs and aspirations. And in case of uncertainty, Benial’s consultants are always ready to help investors find the right company formation that will help their businesses thrive.