Limited liability company (LLC) is one of the most popular forms of setting up a company in Dubai. Limited liability company (LLC) can practice any lawful activities in the UAE excluding insurance business, banking and investment of funds to the accounts of third parties. Foreign investors are limited to have up to 49 per cent of equity ownership in UAE companies, 51 per cent of the equity must be owned by one or more UAE nationals. A company with limited liability requires minimum 2 and maximum 50 partners. Each partner shall only be liable to the extent of his share in the capital.
Advantages of a Dubai LLC
- LLC offers a wide range of business activities excluding banking, insurance and investments.
- LLC in Dubai doesn’t require specific minimum capital.
Disadvantages of LLC in Dubai
- In addition to the government incorporation fees, investors with Dubai LLC have to pay 5% of the annual office premises rent.
- Rather labour-intensive process of Dubai LLC business registration. As Dubai LLC requires a UAE national, that should own not less than 51% of equity capital, the issue of "inactive sponsor” arises, the issue of searching for a person that would not participate in company operations. Al Mubadara consultants will also help with providing such kind of a local sponsor.
- Physical LLC company presence in Dubai requirement. Despite cost effective office space is hard to find in Dubai, our consultants offer solutions to meet every budget and specification, including our Dubai virtual office service.
- If the 49% shareholder in LLC is a foreign corporate entity, then all corporate documents of the foreign company must be notarized and legalized in the country of incorporation of the parent company. In addition, these documents must then be legalized at the Ministry of Foreign Affairs in Dubai and then translated into Arabic.
These requirements contribute to the complexity and costs of setting up a Dubai LLC.