What is the cost of Civil Company Formation in Mainland?

29Nov, 21

What is the cost of Civil Company Formation in Mainland?

Dubai has long been a magnet for entrepreneurs and businesses seeking to establish themselves in a thriving economy. One of the pivotal decisions for any business entity looking to set up in Dubai is choosing between the mainland and free zone incorporation. The Dubai Mainland Company Formation is home to many substantial multinational corporations, small and medium businesses, retail stores, restaurants, coffee shops, shopping malls, and other businesses. Brands from all over the world are looking for a way to enter the UAE mainland. Mainland Company Registration in the United Arab Emirates is one of the most sought-after business Investments by investors looking to actively reach out to a multicultural audience and expand into local UAE marketplaces. Understanding the costs involved in establishing a Civil Company is crucial for those opting to operate within the bustling mainland.

Dubai Mainland Company Formation: An Overview

Establishing a civil company on the Dubai mainland offers numerous advantages, including conducting business directly within the local market without constraints on the number of visas or office space requirements. However, this comes with its own set of costs and regulatory procedures.

The vital corporate structures on the UAE mainland are listed below:

Limited Liability Company (LLC)

In the mainland of the UAE, the LLC structure is one of the most prevalent business structures. When two or more shareholders (up to 50) want to form a company on the UAE mainland, investors usually choose a Limited Liability Company. For entrepreneurs in the region, there are several advantages to forming an LLC company. The fundamental benefit of an LLC Company Shareholder is that their liability in the company is limited to the number of shares they own, and their assets are secured. Limited Liability Companies (LLCs) can be founded on the UAE mainland for various purposes. An LLC Company can be formed to carry out commercial, service, and industrial activities.

Benefits of LLC

The fundamental benefit of an LLC Company Shareholder is that their liability in the company is limited to the amount of shares they own, and their personal assets are secured. Limited Liability Companies (LLCs) can be founded on the UAE mainland for a variety of purposes. An LLC Company can be formed to carry out commercial, service, and industrial activities. As of the recent amendment to the Companies Law, there is 100% expatriate ownership on a select list of business activities for LLC company formation. Setting up an LLC Company in the UAE mainland does not require the involvement of a local UAE national sponsor or a corporate sponsor (a company with a UAE national as a shareholder).

Company of Professionals (Civil Work Company)

In the Mainland of the UAE, consulting, legal, accountancy, and medicine professionals, among others, might form a Civil Work Company. The company's shares can be retained in their whole by the owner. To register a Civil Work Company with the Department of Economic Development (DED), connecting with Dhanguard to communicate with government officials is necessary. Opening a Civil Works Company is a beautiful alternative for entrepreneurs, single owners, and qualified professionals looking to start a business in the UAE. Entrepreneurs can choose from various Professional Licenses offered by the Dubai Economy. Opening a Civil Works Company in the UAE has multiple advantages, including the shareholder's 100% ownership with no obligation for a UAE national as a partner.

Foreign Companies Branch or Representative Office

Investors with an existing office in the UAE's Free Zones or any firm outside the UAE can establish a Branch or Representative Office on the UAE's Mainland. Forming a Branch or a Representative Office is subject to various procedures and conditions. Opening a branch office in the UAE is a lucrative business investment for companies actively expanding into the UAE's local markets. Large enterprises can use Branch Offices to streamline their business processes in new markets while testing market circumstances and audience response before investing in a broad expansion strategy.

What are the Different Types of Mainland Business Licenses?

General trading, manufacturing, and services are the most popular categories of business licenses in the UAE mainland. Specific business license types are required for business operations such as E-Commerce, food dealing, etc.

Investors can choose the company license they want and pay the required cost to legally get a trade license to operate in the UAE. The investor may offer their products and services to the local UAE market and build their firm swiftly with a mainland business license. Once the trade license is approved and the office rental agreement is finalized, the investor can open a corporate bank account with one of the UAE's many commercial banks.

Documents needed to form a Limited Liability Company (LLC)

The following are the documentation you'll need to get your initial approval:

  • Copy of the applicant's passport

  • The DED has released a registration application form and a trade name reservation document.

  • A photocopy of the applicant's papers (for the UAE nationals only)

  • A letter of authorization from the applicant's sponsor (not applicable to GCC nationals).

The following documents are necessary to register a trade license:

  • Receipt of the initial approval.

  • The office or warehouse tenancy contract must be confirmed by the Dubai municipality's planning and civil defense departments and the location plan.

  • The Notary Public has authenticated the original photocopy of the Memorandum of Agreement.

Breakdown of Dubai Mainland Company Formation Costs

The Breakdown of Dubai Mainland Company Formation Costs is as follows:

License Costs

The initial step towards setting up a Civil Company in Dubai mainland is obtaining the necessary licenses. For a Civil Company, the cost may vary depending on the specific nature of the business activities. Costs range from AED 15,000* to AED 35,000* or more, depending on the scope of operations.

Office Space

Renting office space is mandatory for mainland companies. The cost can fluctuate significantly based on location, size, and facilities. Dhanguard has its own Business Center to cater the problem of Office space in the UAE.

Government Fees

Various government fees, including registration and other administrative expenses, are part of the process. These can amount to a few thousand dirhams.

Professional Fees

Hiring consultants or legal experts to navigate complex procedures can add to the overall cost. Professional fees may vary and can increase based on the level of assistance required.

Factors Influencing Costs

Several factors can influence the total cost of establishing a Civil Company in Dubai Mainland:

  • Business Activities: The type and scope of activities your company intends to undertake can significantly impact licensing costs.

  • Office Location: The choice of office space location within Dubai will affect rental expenses.

  • Size of the Company: The number of partners or shareholders involved in the company structure may influence costs.

Conclusion

While setting up a Civil Company in Dubai Mainland offers access to a robust market and numerous opportunities, it's essential to be aware of the associated costs. As costs can vary based on multiple factors, seeking advice from experienced consultants can streamline the process and ensure compliance while managing expenses effectively.

Understanding the norms of Dubai Mainland company formation costs is crucial for making informed decisions and setting realistic budget expectations. By accounting for these costs upfront, businesses can plan their finances more effectively and embark on their Dubai business journey with confidence. Several choices are available to foreign entrepreneurs who want to start a business in the UAE. Civil Company offers the best of both worlds: complete ownership and business opportunities on the mainland. As business advisors, Dhanguard can assist you in forming a professional company or any other type of business in Dubai, UAE. For comprehensive assistance and personalized guidance on Dubai Mainland company formation costs, contact Dhanguard. We specialize in providing tailored solutions for businesses aiming to thrive in the dynamic Dubai market.