Dubai mainland has the most favourable business location in the Middle East. It is now venturing on enhancing its position to become a gateway to the African and Middle East markets, improving economic conditions across the whole African and Middle East countries. Given this potential, company ownership in the UAE has become prevalent amongst investors from across the globe.
One of the easiest and fastest routes to own a company in the UAE is through forming a holding company in Dubai Mainland. Also known as the Onshore Holding Company, Holding Companies are often used for owning shares and/or controlling assets of a subsidiary company. It allows investors to control one or more businesses but does not permit them to sell or produce any goods or deliver any services. It is also a gateway to purchase real estate or hold investments in other corporate entities offering more flexibility in the investment decisions.
However, just like any mainland company setup in the UAE, a local partner must own 51% of the holding company and it must be registered through the Department of Economic Development.
Setting Up A Holding Company in The UAE Has the Following Advantages:
- Tax exemption from corporate taxes, capital gains, dividends taxes, and VAT
- No paid-up capital and cheaper licensing amongst other legal entities available
- Maximum protection from economic volatility, possible takeover, and other disputes from external environment
- Flexible terms in plugging into a trust or foundation
- Lesser risks in debt liabilities and lawsuits
- Allows foreign investors to get Residency Visa for up to 5 years (renewable)
Things to Consider in Setting Up A Holding Company in Dubai Mainland:
The Dubai Company Act regulates the registration of a Holding Company in Dubai Mainland. One of the essential and relevant requirements to form a holding company in Dubai Mainland are the following:
● It must ensure that the company has the necessary capital to operate.
● It should have a management board to ensure the creation of a policy to be respected by the subsidiaries. If no subsidiaries are at hand, the management board must supervise the company’s activities.
● Like any other entities or companies, holding companies should have a Director or a management board depending on the type of its structure. Their role sets complete risk-based restrictions related to foreign currency, industries, markets, and countries concerned. Other functions of management boards include the approval of relevant policies and strategies involved in the proposal of investments, agreements or contracts, and hiring of staff.
In Setting Up A Holding Company in Dubai, Keep in Mind the Following Points:
● Conduct location and market research to determine if the setup and business processes matches your own requirements and plans.
● Choose wisely your partners and employees to maximize the full potential of your holding company.
● Prepare legal requirements beforehand. Ratify written agreements and contracts with your business partners for added protection for your gains and assets.
● Select a competitive agent that will efficiently assist you in setting up your holding company in Dubai.
How Can IBG Help You?
Based in Dubai, IBG Consulting specializes in assisting investors in registering their businesses and companies in the UAE. We are a team of individuals, with each a specific skill and experience that can help SMEs, MSMEs, and large enterprises in creating a name for themselves in Dubai Mainland and other parts of the country.
We offer company formation in UAE, accounting and bookkeeping services, visa processing, and other corporate services tailor-fit to answer to the needs of your company.
To know more about our Holding Company setup services in Dubai, contact us today.