How To Set Up a Mainland Company In The UAE With a Corporate Shareholder

Forming a UAE mainland business with a corporate shareholder offers some exceptional privileges, including access to the market and the ability to perform diversified business activities. Though the formation involves a lot of planning and documentation, it benefits those companies looking to make a strong entry into the market.

This article contains the benefits, requirements, and processes for setting up a mainland company by a corporate shareholder. 

There are various benefits to setting up a mainland company

• Access to Local Markets: Mainland companies can trade directly within the UAE.
• Broad Choice of Businesses: Better suited for mainland operations are manufacturing, retail, investment, and professional services.
• Flexibility of Operations: Mainland companies can open offices or retail outlets in high-demand locations like malls, high streets, or business hubs.
• Strategically Advantageous Opportunities: Mainland companies may bid for government contracts and strive toward international expansion. 

Which Emirate to Choose?

Dubai Mainland

• This suits businesses that want high visibility and a cosmopolitan customer base.
• It is a favorite choice for retail stores, investment firms, and professional services.
• Licensing authority: Dubai Department of Economy and Tourism (DET).

Abu Dhabi Mainland

• Recommended for industrial activities, oil and gas services, and government collaborations.
• Licensing authority: Abu Dhabi Department of Economic Development (ADDED).

Northern Emirates

• Most suitable for fresh start-ups or SMEs that offer an economical alternative.
• Ideal options for logistic activities, manufacturing, or local trade. 

Required Documents

Establishing a mainland company with a corporate shareholder involves lengthy paperwork.

For the Parent Company (Corporate Shareholder):

1. Certificate of Incorporation;
2. MOA and AOA;
3. Board Resolution:

• Authorizing the formation of a mainland company in the UAE.
• Note: It is essential to specify the relevant authority (e.g., “Notary Public Dubai,” “Notary Abu Dhabi,” “Dubai Court,” or “Dubai Department of Economy and Tourism (DET)”) while drafting the board resolution.

     4.Incumbency certificate: Confirms the current shareholders and directors of the company.

     5. Power of Attorney (POA): Appointing an authorized representative.

For Individual Representatives:

Identity documents:

• Passport copies of the authorized signatory and manager.
• UAE visa and Emirates ID (if applicable).

Additional Requirements:

1. UBO Declaration: Identification of the Ultimate Beneficial Owners.
2. Proof of address: For the parent company and authorized signatory.
3. Attested documents: All corporate documents must be:

• Attested by the Ministry of Foreign Affairs and by the Ministry of Justice.
• Translated from a foreign language into Arabic according to UAE requirements. 

The steps are indicated below:

1. 1. Select an Activity to be Engaged: Choose the activity according to business goals (e.g., manufacturing, retail, investment).
   2. Select the Emirate: Depending on operational and market needs.
   3. Register Trade Name: For approval to the relevant licensing authority (e.g., DET for Dubai, ADDED for Abu Dhabi).
      • Drafting of MOA and LSA Agreement:
      • An MOA describes the structure of a company and its ownership.
      • A local service agent (LSA) agreement may be needed for professional licenses.
   4. Document Submission: All corporate and personal documents require notarization and attestation.
   5. Approval from Dubai Commercial Licensing Department: Attain preliminary approval from the licensing authority.
   6. Find Office Space: They need office space Only for a mainland license.
   7. Payment of Licensing Fees: Pay all costs for registration and issuance of the license.
   8. Visa Application: Apply for visas for managers and other employees.  

Key Considerations for Specific Activities

Manufacturing

• Approval is required from the Ministry of Industrialization and/or the Ministry of Industry and Advanced Technologies before commencement.
• Must offer some land for the facility.

Retail Stores

• The physical premise of the store is mandatory.
• Immediate requirement for approval from any municipality.

Investment Companies

Additional verification through documentation is essential to prove the funding source and details regarding shareholders. 

Common Mistakes to Avoid

1. Incorrect Board Resolutions: The Board Resolutions must be addressed by the different notaries or the suitable authority, such as “Notary Public Dubai,” “Notary Abu Dhabi,” “Dubai Court,” or “Dubai Department of Economy and Tourism (DET).”
2. Incomplete Attestation: Attestation and translation into Arabic should be done for all corporate documents.
3. Choosing an Unauthorized Activity: Wrong activity selection may block operations or increase cost.
4. Updates About UBOs Can Be Neglected: Failing to disclose and update information regarding the Ultimate Beneficial Ownership can result in a penalty. 

Cost Breakdown

Bank Account Setup

Key Considerations

• Banks like Emirates NBD, Mashreq, and ADCB are suitable for mainland companies.

Required Documents:

• Trade license, MOA, and AOA.
• Attested corporate documents.
• UBO declaration.

Individual vs. Corporate Shareholders

How RAS Corporate Advisors Can Help

At RAS Corporate Advisors, we provide end-to-end support for mainland company setups with corporate shareholders. Our services consist of:

• Advising the best emirate and activity for your business.
• Preparation and attestation of documents, such as Board resolutions and UBO declarations.
• Structuring the company to comply with UAE regulations.
• Supporting bank account openings and visa processing.
• Assuring compliance to escape delays or penalties.

Call to Action

Are you looking to set up a mainland company with corporate shareholders? Let RAS Corporate Advisors help you make this easy. Speak to us today for expert guidance and personalized solutions for your business setup in the UAE.