Establishing a holding company in Dubai, UAE

There is a series of company formations, which foreigners can use to do business in the UAE. Any person in search of company structure to orchestrate their investment on subsidiary businesses will find holding company in Dubai as the best solution to work with.

What Is a Holding Company?

A holding company is a business entity which is established with express intention of owning shares and controlling the management of other business entities. In other words, it controls the shares and liabilities of its subsidiaries as if it were an operating company practicing different industries; however, it does not perform manufacturing or service operations.

Based on the Company Act of Dubai, a holding company can be incorporated and obtain permission for “activities of holding companies” for various foreign investors.

Key characteristics of a holding company in the UAE include:

• It cannot undertake business activities similar to manufacturing or other business services.

• It must have the supervisory structures (director or board of directors) for supervising subsidiary activities.

• It provides for subsidiaries’ commitments and liabilities up to its ownership percentage. In other areas it controls the financial and operational relationships regarding finances, contracts and strategic management of subsidiaries. However, the offshore holding companies do not qualify to sponsor the resident or employment visa.

Classification of Holding Companies in Dubai

Onshore Holding Company: It needs a local partner who, should hold not less than 51% of the total shares of the venture.

Free Zone Holding Company: Permits 100% foreign ownership something that makes many investors to prefer locating their institutions here.

Procedure to Establish Holding Company in Dubai

Selecting the Right Place and the jurisdiction

It is important therefore, to select a good jurisdiction. Among these factors are the business objectives, target clientele and functional requirements. Dubai can be accussed of mainland and free zone options that it offers to investors.

Prepare Necessary Documents

While there are no official prerequisites, having the following documents ready can streamline the process: Most of the artefacts required by the shareholders are contained in the resolution documents. Document that reveals the share capital and shareholders organization Identifications documents of directors in form of passport copies together with their photos

Organization formation and its subsidiary information

Although not costly, it is advisable to hire a company formation specialist to help in the process to minimize mistakes and complete the process fast.

Advantages of Establishing Holding Company in Dubai Residency:

Gaining UAE residency is very simple after purchasing property through the holding company.

Tax Advantages: It also means that you do not have to pay taxes at the current 0% rate for corporations, capital gains or dividends.

Full Ownership: Free zones are said to permit 100% ownership by the foreign investor.

Risk Management and Anonymity: Company assets, as opposed to the personal holdings created by C Corporation status, lower the corporate risk and preserve the owner’s anonymity.

Human Resource Flexibility: Most of the large multi-national organisations should continue to adeptly recruit and deploy talented foreign workers across their subsidiaries.

Global Fund Access: A corporate bank account is effective the means through which funds may be transferred globally.

Business Growth: Thus, the structure of the holding company provides the opportunity to create innovations at the same time as gaining revenues.

Efficient Management: Overseeing is well controlled when centralized since it is easier to make decisions fast. If you are planning your holding company in Dubai or you are confused about the registration procedure, then, consult the company formation consultants to get each step right.

About Arnifi

Arnifi is digital first Corporate service provider helping companies enter the Middle East region, starting with UAE and Saudi Arabia markets. Founded and backed by professionals from Amazon, Souq and other large companies operating in KSA – the team understands what it takes to succeed as a startup in both UAE and Saudi Arabian markets, apart from going through the setup process multiple times. Arnifi will provide a truly digital experience to entry and scale up of companies both UAE and Saudi Arabia. Discover tailored solutions and strategic partnerships that propel your business forward. Check out at – www.Arnifi.com for more details.

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Also Read: How to expedite company registration using PRO services in Dubai, UAE.