A Limited Liability Company (LLC) is the most common type of company structure in the UAE and is recommended for business planning to trade within the region. An LLC requires a minimum of two and a maximum of fifty shareholders whose liability is limited to their shares in the capital of the company. Under the UAE Commercial Companies Law (CCL), foreign investors are permitted to hold up to 49 per cent equity ownership in an LLC company whilst 51 per cent of the equity must be held at all times by one or more UAE nationals or a wholly-owned UAE national company. Recent amendments to the CCL removed the requirement for a minimum share capital (previously AED 300,000 in Dubai and AED 150,000 in other Emirates), allowing founders of an LLC the freedom to determine the company’s share capital.
Shares of an LLC are not open for subscription by the public. Despite the split in shareholdings, profits may be divided in other ratios agreed upon, taking into consideration efforts of foreign partners in management, provision of technology or expertise. An LLC must appoint a minimum of one manager and up to a maximum of five managers for the business. Responsibility for the management of a LLC can be vested in the foreign partner, UAE national partner, or a third party. Managers must be appointed by a Memorandum of Association or by a management contract, for a fixed term or an unlimited term. Unless the Memorandum of Association states otherwise, the manager has full powers of administration and management of the LLC. An LLC is not allowed to practice its activities in the UAE without a Trade License and Commercial Registration Certificate.
Trinity can also assist in identifying a suitable local sponsor and, if required, arrange for a corporate local sponsorship company managed by Trinity to act as the 51% local sponsor of the LLC.
For advice and further information on starting a business in Dubai, local business setup solutions in Dubai and all other Emirates of the UAE, please contact us through our ONLINE ENQUIRY FORM.
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