9 Steps to Set Up Your Offshore Business in Dubai and the UAE
An offshore business benefits from zero corporate tax, no customs duties, 100% foreign ownership, and complete privacy with asset protection. You can set up a company in the UAE under jurisdictions such as the Ras Al Khaimah International Corporate Centre (RAK ICC) and Jebel Ali Free Zone (JAFZA Offshore). The setup involves several steps, including compliance, documentation, and meeting regulations. In this blog, we will take you through offshore company formation in the UAE and the associated advantages of such a business:
Steps for Setting Up an Offshore Company in the UAE
While an offshore business does not directly engage in the UAE market commercially, it can hold investments, perform international trade, enjoy tax benefits, protect company assets, and retain confidentiality with other benefits. Here is a guide to setting up a company in the UAE under this jurisdiction.
1. Appointment of a Registered Agent
Offshore companies must be incorporated through a registered agent licensed by the respective jurisdictions. The agent assists with documentation, compliance, and communication with the offshore authority. You can take guidance from business setup consultants in the UAE, who will aid you through administrative activities, selection of offshore jurisdiction, cost of offshore company setup, get mandatory approvals, and advice through other processes.
2. Opt for an Offshore Free Zone and Type of Entity
Each offshore option has its regulations and benefits. There are many offshore free zones in Dubai, and the most prominent ones are:
RAK International Corporate Centre (RAK ICC) offers a seamless and quick setup process with a flexible legal framework.
Jebel Ali Free Zone (JAFZA Offshore) is popular for its global trade routes and strategic positioning.
Offshore entities are non-resident (engage in international business and hold assets but do not participate in the UAE market directly).
They can be holding companies – holding intellectual property, shares of other organizations, or real estate investments.
Or, they are International Business Companies (IBCs) dedicated only to international business deals.
3. Appointment of Shareholders and Directors
For an offshore company formation in the UAE under Jafza, the business must have at least one shareholder or more. However, there is no restriction on the maximum number of shareholders. The shareholder can be an individual, a non-individual (company), or a combination of both. The company should also have at least one director - a corporate entity or an individual. Do note that a single shareholder in RAK ICC can function as the director.
4. Company Name Should Adhere to Trade Name Guidelines
Establishing a business entity in the UAE requires selecting a trade name that adheres to its license issuing authority’s Trade name protocols. The name must comply with UAE regulations, avoiding restricted or sensitive terms, and ensuring it is unique and unregistered. The business registration workflow involves submitting requisite documentation to the appropriate regulatory bodies. Partnering with professional business setup consultants can optimize the process, mitigate compliance risks, and deliver an end-to-end, hassle-free setup experience.
5. Draft the Memorandum and Articles of Association
The Articles of Association (AOA) state the responsibilities of shareholders and directors, how the organization will be managed, and other norms of the governance structure. The Memorandum of Association (MOA) states the company and business objectives. You need to submit these to the respective authorities. The Free Zone authority will review the papers and check if these comply with their laws and regulations.
6. Prepare and Submit Documentation
Offshore company registration requires specific documents, which may include:
Passport copies of shareholders and directors.
Proof of residence (utility bill or bank statement).
Curriculum vitae (CV) of shareholders or directors (optional in some cases).
A notarized Memorandum of Association (MOA) and Articles of Association (AOA).
A resolution specifying the company’s objectives.
7. Obtain the Certificate of Incorporation
You will receive an offshore company license once you finalize the company structure and the registration application is approved by the authorities. Some licenses offered are an Offshore License, Certificate of Incorporation, Shareholder Certificate (if applicable), or Memorandum and Articles of Association. You will have a high confidentiality level and protection for certain crucial information, extending to legal rights.
8. Open a Corporate Bank Account
After offshore company formation in the UAE, you must also get a corporate bank account under international jurisdiction. Physical presence is mandatory to open the bank account. A business setup consultant in the UAE can assist in selecting the right bank to open an account that meets your company's requirements and culture. It will take care of all the processes and compliances so that you do not have to personally research for the bank.
9. Compliance After the Offshore Business Setup
Even after you set up an offshore company in the UAE in an offshore free zone, compliance with certain regulations is important. These include yearly renewal of company license, annual financial reporting, maintenance of legal documents and records of the organization, filing yearly returns, holding the annual general meeting if applicable, declaring of Ultimate Beneficial Owner (UBO) Information, submission of documents if there is a change in the company structure/shareholders/directors, etc.
Final Words
An offshore company setup can be tedious if you do not have the right guidance, making mistakes that will lead to rejections. To avoid such consequences and get the best local qualified assistance, consider The First Partner, a complete host of solutions catering to any business willing to deal in Dubai. We ensure correct procedures are followed to register and set up a company in the UAE without having you run helter-skelter to do what is needed.
With efficient legal and financial advisors and dedicated relationship managers, your offshore company formation in the UAE does not remain a dream but will see the light of day soon. Lay your trust in us today, and always live in a futuristic reality with comprehensive business setup services. Get in touch with us for more details.