As you know, there are three types of firms in Dubai and the UAE. Offshore companies registered in the UAE Free Economic Zones. The third type of company is a local company opened in Dubai and the UAE. The advantages of registering a local company in Dubai are that such a company is registered by the Dubai Economic Department in just 2 hours, unlike firms in Free Zones (3-7 business days). As a rule, there are no cases of refusal to open accounts by UAE banks in relation to a local company. More than 2,000 types of activities are allowed for a registered local company in Dubai. A local company can operate in any Emirate, as well as in any country in the Persian Gulf, and can also work with government customers.
WHY DO LOCAL BUSINESSES IN DUBAI PREFER THE FREE ZONE?
Very often, our clients do not trust local companies and ask them to register a company in the free economic zone of Dubai and the UAE? Let's look into this misconception. Indeed, Federal Law No. 2 was in force in Dubai and the UAE until 2019.” About commercial companies”, which indicated that 51% in a local company should belong to a local citizen. This deterred many customers who wanted to fully control their business, so they chose to register companies in the Free Zone, where 100% foreign ownership is allowed. Everything changed in 2019, when the legislation changed. Please note that since 2019, the law has been amended to allow 100% ownership by a foreign citizen of a local company in many types of activities (more than 120 types). In this case, there is no local partner. There is only a local agent who formally represents your interests before the state. Thus, a local company in Dubai and the UAE is available to foreigners for 100% ownership.
BENEFITS FROM A LOCAL COMPANY IN DUBAI
As can be seen in the photo on the right, the law now allows for foreign citizens to own 100% of a local company, only if there is a local agent. A local company gives you the following advantages:
Lower cost of setting up a company
No requirements from banks when opening a real office account
⊕ The opportunity to rent an office not only in the FEZ, but in any part of Dubai
, The cheap cost of renting a virtual office
High probability of opening an account in a Dubai Bank
Lack of a local partner (for many types of activities)
,A simple company registration form
The company registration period has been reduced to 2 hours.