Dubai is one of the most prominent cities in all of the Emirates. It has become the face of the Emirates and is growing into one of the best spaces for business development and growth. There are multiple opportunities for businesses from different sectors, and the business owners are given many different perks and benefits to start businesses in Dubai and the other Emirates. The state of the art infrastructure and the environment provide an extraordinary boost to existing businesses and to startups who plan to start their venture in Dubai. Starting a civil company in Dubai is a lucrative opportunity that many business and corporate owners are looking forward to.
Here’s everything you need to know about starting a civil company in Dubai.
What is a Civil Company?
A civil company, simply put, is an establishment made up of a partnership of two or more individuals to provide services to the public of Dubai. The partners can be qualified professionals in specialised fields such as medicine, accounting, marketing, etc.
The partners that consent to form a civil company can be of any nationality. The formation of the company requires the additional support of an LSA, or local service agent if they do not even have one partner with a GCC nationality.
The local service agent, or LSA, facilitates the formation of a civil company with assistance from the Department of Economic Development and the Ministry of External Affairs.
The civil company can be started with 100% foreign ownership, but one would still need to appoint an LSA for going ahead with approvals and such on the mainland. The requirement of the local sponsor is what is taken off the mandate; the qualified partners still require the help of an LSA agent to set up a civil company in Dubai. The LSAs do not have any vested interest in the financial element of the company.
LSAs only try to represent the company and the business owner in the formation of the civil company in Dubai.
Requirements and Eligibility for Forming a Civil Company in Dubai
To start a civil company in Dubai, certain other conditions have to be fulfilled by the company, and they are:
- There are limitations to the number of managers in a civil company in Dubai.
- Local Services Agents can be appointed to be part of the civil company formation only through service contracts or service agent agreements.
- The name of the company, which is otherwise known as the trade name, should be consistent with the commercial activity.
- Once the civil company receives its licence, it can start multiple branches in the Emirates. Each branch can engage in all or some of the tasks already mentioned under the licence for civil companies in Dubai.
- The civil company in Dubai can change its legal guidelines or framework if it is in accordance with the regulatory requirements of the Department of Economic Development.
- The civil company can be sold to any person or business.
Benefits of starting a Civil company in Dubai
As discussed earlier, company and business formation in Dubai come with many different perks and other benefits. The advantages also benefit the start of a civil company in Dubai.
Let us take a quick glance at the benefits of starting a civil company in Dubai:
- Agility in Business setup
One of the most significant advantages of doing business in Dubai is the flexibility with which the authorities provide civil company formation. Therefore, if you intend to start a civil company in Dubai, the entire process is quick and simple.
- Sponsorships of Dependents made easy
If you are the owner or the shareholder of a civil company in Dubai, you can easily sponsor the dependents' residence visas or permits. Residency permits are something that takes a lot of time the other way around and these visas can be effective for relatives, domestic helpers, etc.
Unlike other types of company or business formations in Dubai, civil company formation is not expensive. The money that you spend to start a civil company in Dubai will be limited to the fees that you have to pay to obtain a professional licence. The overall launch costs are also comparatively lower.
- No limit on visas
Owners of civil companies can apply for and get more than one visa at a time. According to the stated rule, one visa will require the owner of the civil company in Dubai to have 100 square feet of space. Larger companies can come to terms with the DED for the provision of visas.
How to Establish a Civil Company in Dubai
To establish a civil company in Dubai, the following steps must be taken:
- Choosing a trading name is the first step to starting a civil company in Dubai. There are certain terms and conditions that need to be followed for selecting a name for the business. The name should not bear similarities to any other already existing company. It should not bear resemblance to the name or terms of any religion, especially Islam. The name should also not be in short forms and be the initials of the name of the owner.
- The next step is to choose the business activity; here it is a civil company. The business activity should be selected based on the location and this is because specific locations have a permitted list of activities.
- Securing the initial approval of the business is the next follow-up procedure. Permission should be obtained from the department of economic development and they have to provide them with a set of documents.
- There are certain documents that need to be submitted to get approval for a business licence
- Detailed initial approval application
- The registered name certificate
- Copies of the passports, and include the passport of the local service agent.
- A notarized contract with the UAE citizen who is the company’s local service agent.
- Address and phone numbers
- A detailed structure of the partnership deed
- A lease agreement from the land department.
- When these documents are submitted at the right time and approved. You will get the business licence after paying the fees.
Considerations for Establishing a Civil Company in Dubai
Some considerations have to be taken into account before starting a civil company in Dubai:
- The trade name should reflect the commercial activity of the company.
- Civil firms can open up however many branches they want.
- Anyone can sell or buy a civil firm.
- The owner can change the legal structure of the business.
- Professionals of the civil company can be partners of multiple nationalities.
Difference between Civil Company and LLC
The major difference between a civil and an LLC company is how liability is dealt with in both business setups. LLC is a safe company, as the liability of the shareholders is limited to the contributions that they put into the company. In the case of a civil company, the liability is unlimited. When the liability is unlimited, the shareholder will have no control over the liability, and in the worst scenario, the liability can be covered using even the personal assets of the shareholders.
How can Kiltons help in the formation of a civil company in Dubai?
Kiltons Business Setup Services is one of the best business setup consultants in Dubai. They have been in the business of helping different businesses from all over the globe set up their businesses and companies in Dubai. The constant support from our professionals will help you set up your business with step-by-step assistance. Our distinguishing features include client-tailored services. We will modify the suggestions based on your specific needs. You can enter the world of business right away with our business services and begin your dream journey to a business establishment in Dubai.