Starting a Business - UAE

Federal Decree-Law No. 26 of 2020, effective 30 March 2021, abolished the prior requirement for a UAE national to hold at least 51% of onshore companies. Foreign investors may now own 100% of a mainland LLC for the vast majority of activities. Federal Decree-Law No. 20 of 2025 further clarified and reinforced these rules.

A limited negative list of 'Activities of Strategic Effect' (e.g., certain defence, oil & gas, utilities, and security-related activities) still mandates a UAE national partner. Outside this list, full foreign ownership is the default on the mainland.

The UAE hosts 45+ specialised free zones (e.g., DIFC, JAFZA, ADGM) where 100% foreign ownership has always been permitted. Free zone companies benefit from zero customs duties and 100% profit repatriation but are generally restricted from direct onshore UAE trade without a local distributor or separate mainland licence.

The official mainland process involves: (1) choose activity and legal form; (2) register trade name with DED; (3) obtain initial approval; (4) notarise Memorandum of Association; (5) secure Ejari-registered office lease; (6) receive trade licence; (7) open corporate bank account. Mainland setup typically takes 2–4 weeks; free zone setup 5–14 business days. The Bashr digital platform targets 15-minute online registration.

Mainland LLCs must record a minimum authorised share capital of AED 100,000 in the Memorandum of Association; Dubai DED practice has typically required AED 300,000 while other emirates may accept AED 150,000. No mandatory paid-up deposit is required upfront. Free zone minimum capital varies widely, from AED 1,000 to AED 50,000 depending on the zone.

A 9% federal Corporate Tax applies to taxable income above AED 375,000 for financial years beginning on or after 1 June 2023. Qualifying free zone entities may access a 0% rate on qualifying income subject to substance and governance requirements. UAE also mandates Ultimate Beneficial Owner (UBO) registration for all companies.