LLC Formation Strategic Insights for Foreign Investors in the UAE

Complete guide on LLC company setup | Dubai | UAE

Limited Liability Company (LLC) is the most common type of business setup in the UAE. A Limited Liability Company can be created by a minimum of 2 and a maximum of 50 shareholders whose liability is limited to their shares in the company’s capital. Most companies with foreign partners have chosen the option of the Limited Liability Company because this is the only option that will give maximum legal ownership that is 49% to the investor for a local business in UAE. It is mandatory to have a United Arab Emirate national as a major partner in the Limited Liability Company 51% shareholding, the prospective foreign investor has the option to choose the one UAE national (sponsor) as a partner in the Limited Liability Company (LLC). Business setup as Limited Liability Company (LLC) is flexible and differential profit-sharing arrangements also possible between a prospective foreign investor and the local partner. This permits the foreign investor a great advantage as 51% legal equity is with local UAE national partner.


If you are a foreign investor and wish to establish a business in Dubai or the United Arab Emirates then you need to know about sponsorship in Dubai. Every foreigner in the country must have a Sponsor to start a business. Every business must have a Sponsor which is also sometimes called service Agent. If you want to come to Dubai on a visit then you are going to need sponsorship for Dubai. It is very important to have sponsorship for Dubai and in the UAE. If you are starting a business in the UAE free zone than the free zone is your sponsor. A Sponsor or a Service Agent in Dubai is any UAE national, which could be a man or woman, or sometimes any UAE owned company who is willing to take on the obligation of bringing you into UAE as an investor, or as an employee, or even if you are a visiting as a tourist. Some professional categories only require having a Service Agent.

The licensing Authorities
  • In Dubai, Sharjah and Abu Dhabi, the licensing authority of an LLC is Department of Economic Development (DED)
  • All other emirates LLC can be authorized from Municipality/Chamber of Commerce
Advantages of Limited Liability Company (LLC)
  • This is the most popular form of establishing a commercial company in the United Arab Emirates
  • Foreign investor’s equity in the company does not exceed 49%, however, the profit and losses of business setup can be shared at a ratio different from the share capital
  • Limited Liability Company (LLC) offers unparalleled access to the wider UAE economy
  • There are no specific minimum capital requirements for business set up as Limited Liability
Company (LLC)
  • The foreign investor becomes the partner in the Limited Liability Company (LLC)
  • By company formation as Limited Liability Company (LLC), the investor gets the investor visa under which he/she enjoys the investor’s status in the United Arab Emirates along with his/her family
  • The investor has the option to start branches of Limited Liability Company (LLC)
  • The foreign investor can manage the business without having any interference from the local partner
  • By starting a business as Limited Liability Company (LLC) it is easy to open global /local corporate bank accounts
  • The assets and capital gained by the company will be in the name of the company and not in the name of the local sponsor or partner
  • Business setup as Limited Liability Company (LLC) will provide you the benefit of availing credit facilities from bank
Company incorporation, which requires special approvals and licenses

Following are the type of companies, which need special approval and licenses for them to setup as Limited Liability Company (LLC)

  • Companies involve in tourism activities
  • Companies involved in Health Care activities
  • Architectural and engineering consultancy services
  • Companies involved in shipping, freight forwarding, and logistics activities
  • Companies in Dubai World Communities
  • Educational services

There are at least seven categories of business organizations, which can be established in the United Arab Emirates. It arrays the requirements in terms of shareholders, directors, minimum capital points and the company’s incorporation procedures and proceedings.

  • General Partnership Company
  • Private Shareholding Company
  • Partnership-en-commendams
  • Joint venture Company
  • Share Partnership Company
  • Public Shareholding Company
  • Limited liability Company (LLC)

Out of these seven activities, Limited Liability Company (LLC) are more commonly used by foreign investors due to its flexibility and independence in term of controlling and decision making. Licenses issued for business setup in UAE fall under three categories:

  • Commercial licenses: Under this type of license one is allowed to carry out all kinds of trading activities
  • Professional licenses: Under this type of license one is allowed to perform professional activities such as professions, services,craftsmen and artisans etc.
  • Industrial licenses: Under the industrial license, one is allowed to establish industries involve in manufacturing activity.
Our Consultancy services

MSZ corporate services provider closely cooperate with clients to handle their business setup as LLC incorporation from starting point to end line and assist with strategic and calculated ideas, work with their given business plans and prepare your paperwork to be cleared by different authorities. Start your LLC company setup today!

  •  Getting approvals and clearances from various departments on your behalf
  • Drafting Memorandum of Association and other necessary agreements for LLC company formation
  • Helping to open bank accounts
  • Handle other documentation formalities to be cleared by authorities
  • Help to bring local equity for business setup as LLC
  • Finding local partners for you to start a company formation
  • Assisting to find a proper office location

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