Sovereign (Abu Dhabi) Limited
Abu Dhabi is a reputable and regulated trading jurisdiction. If properly structured, Abu Dhabi company formation is an ideal way to legitimately gain profits without paying local corporation tax. In addition, there are no capital gains or personal income taxes in Abu Dhabi. Abu Dhabi company formation has no specific capital requirements after minimum capital requirements in the UAE were abolished. Some companies may face some capital requirement in accordance with the size, nature and goals of their business. Most foreign investors choose either a limited liability company (LLC) or a branch of a foreign company as the best corporate entity to efficiently and effectively conduct business in Abu Dhabi.
Sovereign (Abu Dhabi) has a qualified and experience team to assist client in setting up:
Limited Liability Company
Branch Offices of Foreign Companies
Free Zone Company Formation
Offshore Company Formation
Limited Liability Company
Abu Dhabi Limited Liability Company requires a minimum 51% shareholding by UAE nationals. A Limited Liability Company can be formed by a minimum of two and a maximum of 50 persons whose liability is limited to their shares in the Company's capital. Most Companies with expatriate partners have opted for this Limited Liability Company, due to the fact that this is the only option which will give maximum legal ownership i.e. 49% to the expatriates for a trading license.
Therefore the normal shareholding pattern for an LLC is:
Local sponsor - 51%
Foreign Shareholder (s) - 49%
While foreign equity in the company may not exceed 49%, profit and loss distribution can be mutually agreed. Responsibility for the management of a Limited Liability Company can be vested in the foreign or national partners or a third party.
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Branch Offices of Foreign Companies
It is easy to setup a branch office of foreign company in Abu Dhabi and also it can be 100% foreign owned, provided a local service agent is appointed. A branch office, legally regarded as part of its parent company, is a full-fledged business, permitted to perform contracts or conduct other activities as specified in its license. A branch office may only be engaged in activities similar to those of its parent company.
Only UAE nationals or companies 100% owned by UAE nationals may be appointed as local service agents. Local service agents - also sometimes referred to as sponsors - are not involved in the operations of the company but assist in obtaining visas, labour cards, etc and are paid a lump sum fee per annum. The time required to form a branch of a foreign company is approximately 3-4 weeks from the date of receipt of all the documents.
Business plan, current profile and last two year financial statements must be submitted to prove the credibility of the company. The Companies that are of trading nature must have manufacturing facilities at its country of origin. All branch ventures are subject to an approval of the Ministry of Economy.
Abu Dhabi Services
At Sovereign Abu Dhabi, we provide a complete package of Abu Dhabi LLC or Branch setup, which includes obtaining the Trade Licence, Labour Card, Visas, Bank Account etc. We also assist our clients by introducing them to silent, dormant, trust worthy UAE nationals to fulfill the legal requirement. We have a stringent wetting procedure to assess the suitability of nationals as local partners. We only recommend credible individuals as sponsors who have a well-established track record of non-interference and unequivocally commitment to support the businesses of our expat clients.
The UAE national partner, usually called "The Local" or "The Sponsor", remains a sleeping/silent partner and is there only to fulfill the legal requirement. The sponsor has no rights on the business management, turnover or profits. At Sovereign Group, we draft all the legal agreements to protect the interest of our clients.
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Free Zone Company Formation
Abu Dhabi now has 2 Free Zones, including Airport Free Zone (which was the first) & Abu Dhabi Media City (twofour54). The main attraction of establishing an entity in one of the free zones is that there is no UAE national shareholding or sponsor requirement.
We can establish a Branch of an Offshore Company or a "FZ-LLC" or Free Zone LLC
Benefits of Free Zone Company
100% foreign ownership
100% repatriation of capital and profits
100% corporate and personal income tax exemption
No currency restrictions
Abundant and inexpensive energy
Modern efficient communications
Excellent support services from local authorities
Once a company has been accepted into a free zone it will typically operate under one or more of four different licences being a "commercial licence", "general trading licence", "industrial licence" and "service licence". Free zone registrations do not require a local sponsor or any local partner. Companies registered in the free zones have to pay 5% duty and appoint a local service agent if they wish to sell goods or services within the Emirates. Overseas sales are free of any duty.
Free Zone Establishments and Free Zone Companies have differing minimum share capital requirements dependant upon the free zone of incorporation. They will have a requirement to rent office space in the Free Zone, and must also pay annual licence fees.
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Offshore Company Formation
Offshore company structures have become invaluable features in most financial planning scenarios when trying to mitigate tax exposure and/or with regards to assets protection, investment management.
What is an Offshore Company?
A company which is incorporated outside the jurisdiction of its primary operations called an Offshore Company. The jurisdiction could be an offshore business/trade centre. In simple term, offshore companies are businesses that has been filed or incorporated outside of one's country of residence.
There are many jurisdictions where offshore companies are offered. Some of the prominent locations are the Isle of Man, Cayman, British Virgin Islands (BVI) and more recently United Arab Emirates. Each jurisdiction has its niche in the offshore investment business. When establishing such an entity, you need to determine which jurisdiction is going to be most suitable for your circumstances.
Sovereign Group has offices or agents in all the major international finance centres and we can form an appropriate company structure which is practical, cost-effective and compliant. Why an Offshore Company?
There are several reasons why anyone would consider establishing a company offshore and in fact, greater numbers of individuals and corporations are taking steps to incorporate overseas away from either their nation of domicile and/or residence, or away from the nation in which their main business transactions are conducted.
To save tax - an offshore company can form part of an overall taxation reduction strategy for most individuals or entities. Combined with an offshore bank account or trust for example, an offshore company can save an individual tax or when such an offshore corporation is set up in a low or no tax nation, it can be used to enable a business to realize profits in as tax efficient way as possible.
For asset protection - again, where an offshore company is established as part of an overall strategy for wealth preservation with the likes of a trust for example, it is the perfect entity for enabling individuals to achieve asset protection offshore. Assets can be owned by the company rather than directly by an individual, and the company can be placed in trust for example.
To achieve a higher level of anonymity - a number of overseas centres offer the option of having nominee directors for the establishment of a company and others also manage to keep the names of directors and shareholders off public record. This means that those who transact through such a company can keep their affairs private.
Naturally the features, benefits and reasons why people establish a company offshore differ from individual to individual and Sovereign Group can assist you in determining the best Offshore company structure.
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