LLC in the UAE

An LLC in the UAE is a business structure where the owners’ liability is limited to their investment in the company. Consequently, it allows you to trade anywhere in the UAE and the GCC region, making it ideal for businesses targeting the local market. Typically, an LLC requires a local sponsor (UAE national) who holds 51% of the shares, while you retain 49%. However, due to recent reforms, 100% foreign ownership is now possible in certain sectors and emirates, depending on your business activity.

Define Business Activity

First, identify the nature of your business (e.g., trading, consultancy, manufacturing). Next, understand that the UAE’s Department of Economic Development (DED) regulates business activities, and your chosen activity will determine your license type and legal requirements. Finally, ensure your activity aligns with UAE laws—because some sectors, like healthcare or education, may have additional approvals.

Choose a Trade Name

Select a unique name for your LLC that complies with UAE naming rules:

• Avoid offensive or religious terms.
• Ensure it reflects your business activity (e.g., “XYZ Trading LLC”).
• Check availability with the DED in your chosen emirate (Dubai, Abu Dhabi, etc.).

Once approved, your trade name will be reserved for your company.

Find a Local Sponsor (If Required)

For most mainland LLCs, you’ll initially need a UAE national as a local sponsor or service agent. However, the sponsor technically owns 51% of the shares but often acts as a silent partner via a side agreement, thereby allowing you full operational control. Meanwhile, recent updates in 2021 allow 100% foreign ownership in specific industries—so check with the DED or a business setup expert to see if your activity qualifies.

Apply for Initial Approval

Submit your business plan and initial documents to the DED in your emirate. Required documents typically include:

1. Passport copies of all shareholders.
2. Proposed company name and activity.
3. A completed application form.

The DED will issue an initial approval certificate, confirming your business setup is permissible.

Draft the Memorandum of Association (MOA)

First, prepare the MOA, a legal document outlining the ownership structure, profit-sharing, and operational details. Then, ensure this must be signed by all shareholders (including the local sponsor, if applicable) and notarized at a UAE public notary office. Additionally, a business setup consultant can assist with drafting this to ensure compliance.

Ecure a Business Location

First, rent a physical office or shop space, as a mainland LLC requires a registered address. Next, obtain an Ejari (tenancy contract) registered with the emirate’s land department (e.g., Dubai Land Department). Finally, note that the size and location depend on your business needs and budget.

Obtain Your Business License

Submit the following to the DED for your LLC license:

• Initial approval certificate.
• Notarized MOA.
• Ejari and tenancy contract.
• Passport copies and visa details of shareholders.
• License application form and fees.

The DED will issue your commercial license (or professional/industrial, depending on your activity) once approved. Fees vary by emirate but typically start at AED 15,000–25,000, including sponsor and registration costs.

Register with the Chamber of Commerce

Enroll your LLC with the local Chamber of Commerce (e.g., Dubai Chamber) to gain credibility and access to business networks. This step is mandatory for mainland companies.

Open a Corporate Bank Account

With your license and MOA, open a business bank account with a UAE bank (e.g., Emirates NBD, ADCB). You’ll need to deposit the minimum share capital—requirements vary by emirate but can range from AED 50,000 to AED 300,000, depending on your activity.

Apply for Visas

Secure residency visas for yourself and employees. An LLC allows you to sponsor a certain number of visas based on your office size and business needs. Submit applications through the General Directorate of Residency and Foreigners Affairs (GDRFA) with your license and lease agreement.

Basic benefits of an LLC in the UAE

• Market Access Trade freely within the UAE and GCC without restrictions.
• Liability Protection Your personal assets are safeguarded from business debts.
• Credibility An LLC enhances your reputation with local clients and partners.

Costs to Expect

1. License and registration: AED 15,000–25,000.
2. Local sponsor fees: AED 5,000–15,000 annually (if applicable).
3. Office rent: Varies by location (e.g., AED 20,000+ per year in Dubai).
4. Visa fees: AED 3,000–5,000 per visa.

Key Strategies for a Smooth Setup

1. Hire a Consultant: Firms like Buraqs CNP can simplify the process, handle paperwork, and ensure compliance.
2. Research Reforms: Check if your industry qualifies for 100% ownership to avoid sponsor costs.
3. Plan Finances: Account for initial capital and ongoing expenses like rent and renewals.

Contact Us

Forming an LLC in the UAE is a smart move for entrepreneurs aiming to tap into a thriving economy in 2025. While the process involves several steps, the rewards—access to a lucrative market, tax benefits, and growth potential—are well worth it. Need help? Contact a trusted business setup provider to get started today and launch your UAE venture with confidence!