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Company Formation

LLC

Limited Liability Company

Definition

Most common UAE mainland structure. Foreign nationals can launch an LLC with 100% foreign ownership and no local sponsor required for most commercial activities since 2021.

Also known as

  • Limited Liability Company
  • Mainland LLC

Attributes

TypeCorporate legal structure
JurisdictionUAE mainland
Governing authorityEmirate-level economic department
Applicable lawUAE Federal Decree-Law No. 32 of 2021 on Commercial Companies
Foreign ownership100% permitted for most commercial activities since 2021
LiabilityLimited to capital contribution
Minimum shareholders1
Maximum shareholders50

What it is

A Limited Liability Company is the dominant legal form for UAE mainland businesses. Each shareholder's liability is capped at their share-capital contribution, ring-fencing personal assets from business risk. The structure is governed by the UAE Federal Decree-Law No. 32 of 2021 on Commercial Companies, which removed the historic requirement for 51% UAE-national ownership across most commercial activities.

An LLC can have 1–50 shareholders, must appoint at least one manager (named on the trade license), and operates under a Memorandum of Association notarised at incorporation. Mainland LLCs can trade anywhere in the UAE, bid on government tenders, and rent offices in any emirate. They are licensed by the Department of Economy & Tourism (DET) in Dubai, or the equivalent department in other emirates.

A small list of "strategic impact" activities — oil & gas, certain defence categories, telecommunications — still require Emirati ownership or partnership. Everything else is open to 100% foreign capital.

Key characteristics

Liability
Limited to share-capital contribution
Foreign ownership
Up to 100% on most commercial activities (since 2021)
Shareholders
1–50 individuals or corporate entities
Market access
All UAE — mainland, free zone, government tenders
Licensing authority
DET (Dubai) or emirate-equivalent
Tax
9% Corporate Tax on profits above AED 375,000

How it works

  1. Select commercial activity and verify permitted foreign ownership percentage with the relevant DED. 2. Reserve a trade name and obtain initial approval. 3. Draft and notarize the Memorandum of Association (MOA), specifying shareholding, profit distribution, and management powers. 4. Secure a tenancy contract (Ejari for Dubai; Tawtheeq or equivalent in other emirates) for the registered office. 5. Submit documentation to the DED, pay fees, and receive the commercial license. 6. Register with the Federal Tax Authority (FTA) for corporate tax and, if applicable, VAT. 7. Open a corporate bank account and commence operations under the licensed activity.

Examples

A UK consultant opens a Dubai LLC to bill regional clients and rent office space in Business Bay. A Singapore retailer opens an LLC to operate a chain of mainland stores in Dubai Mall and Mall of the Emirates.

Why it matters

An LLC is the only structure with full UAE-wide market access. Free-zone companies cannot sell directly to mainland customers without a distributor or branch — for B2C retail, professional services to UAE clients, and government work, an LLC is usually the right answer.

Common misconceptions

  • Misconception

    You still need a UAE national 51% sponsor for an LLC.

    Reality

    Federal Decree-Law No. 32 of 2021 removed the requirement for most commercial activities. 100% foreign ownership is now the default.

  • Misconception

    LLCs are always more expensive than free zone companies.

    Reality

    Setup cost depends on activity, office size, and visa quota — not legal form. Some free-zone packages now cost more than equivalent mainland LLCs once visas are factored in.

FAQs

Can I open a UAE LLC remotely?
Mainland LLC formation traditionally requires in-person notarisation of the MOA, but remote signing via apostilled and MOFA-attested power of attorney is now standard. A single short trip is required only for visa stamping and Emirates ID once the license is issued.
What's the minimum share capital for a UAE LLC?
There is no fixed legal minimum for most activities — share capital is declared in the MOA and must be 'sufficient for the business purpose'. Banks, however, often expect AED 50,000–300,000 in the corporate account during onboarding.
How is an LLC taxed in the UAE?
Federal Corporate Tax of 9% applies on net profits above AED 375,000. VAT of 5% applies if annual taxable supplies exceed the AED 375,000 mandatory threshold. There is no personal income tax, no withholding tax, and no capital-gains tax.

See also

For better understanding, see also

Sources

External references

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