Establishment of Joint Stock Company in UAE

Establishment of Joint Stock Company in UAE

The United Arab Emirates, located in the Arabian Gulf, is a country with a high proportion of young people. Foreigners constitute 80% of the population. Oil and natural gas is the most critical resource. It is the third largest economy in the Middle East and Gulf Countries with its GNP. It ranks 7th in the world as its oil reserves. Its economy is based on tourism, construction, automotive, finance, aviation, and service sectors as well as oil and natural gas. With the development of free zones, more than 100 countries have invested in UAE with over 3000 companies. The fact that foreign investors were exempt from customs tariffs and tax controls made it easier to establish a company in the UAE. Free zones are preferred for foreign investors with their quality infrastructure.

How to Establish a Joint Stock Company in UAE ?

Foreign investors may start commercial operations by establishing a company in the UAE. There is no need to have a branch or a representative office in the UAE for the establishment of a Joint Stock Company. Therefore, investors or individuals and institutions in the free zones in the Emirates has the possibility of setting up a joint stock company. The difference between the free zones and the Emirates in establishing the Joint Stock Company in the UAE is that the investor who will establish a company in the free zone does not need a local partner. Investors can continue their activities without the need for a local partner.


General Considerations

Establishment of Joint Stock Company in UAE , the company, is covered by the company’s law no. Many consulting firms provide services for the establishment of a joint stock company. If the company is to be established in the free zone, the offices in the free zone are involved in the necessary operations. In the case of large-scale investments, support should be sought from law firms. Joint-stock companies can be combined in state and special agency.

Services offered by consulting firms :- 

  • Preparation of the Company’s contract and reconciliation
  • Detailed economic feasibility study and preparation
  • Obtaining necessary approvals from official institutions
  • Commercial registry processes of the Ministry of Economy
  • Follow-up process of the registration document
  • The public and private merger of joint stock companies under Federal Law No. 8/1984


The preparation of the detailed feasibility study has a vital role in the establishment of the Joint Stock Company in the UAE . In the public and private merger of the joint stock company, ESCA and the relevant department of the Ministry of Economy shall apply. The consultancy firms provide professional support from the preparation of the agreement to the establishment of the company. The process of establishing a Joint Stock Company in the Emirates or free zone is different.

Establishment of Joint Stock Company in UAE

For a foreign investor to establish a joint-stock company in the Emirates (city), it is compulsory to make one or more UAE citizens a partner. It is not possible to establish a commercial company without a partnership. The membership registration of an investor who wants to set up a company in Dubai is done by the Dubai Chamber of Commerce and Industry. At the same time, the Economic Development Department regulates the trade license. A minimum of 2 maximum 50 partners can be established. The share is 49% of the foreign investor and 51% of the domestic partners.

 Establishment of Joint Stock Companies in Free Zones

There is no need for a local partner in the establishment of joint-stock companies in free zones. The foreign investor can establish his own company with his capital. Company establishment procedures are also made in the free zone — no customs duty on export. It is also exempt from import and re-export taxes. Profit and capital transfer are possible in the free zone. Energy and qualified personnel in the region are cheaper. In the free zone, the accommodation needs of the company employees are met. Procedures are done on-site and are short-lived.

In the free zone, all transactions such as subscription form, first offer memo, company logo, official correspondence, shareholder list, external auditor selection are carried out in the free zone. UAE foreign investors to establish joint stock companies operating in the construction industry if, jointer It is recommended that they choose a venture or LLC form.


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