Holding Company - Why you should setup a Holding Company in UAE

What is the function of a holding company?

• It is a parent company for managing the controlling interest and stocks in the companies. It doesn’t sell or manufacture any product.
• You can own numerous international franchises or branches in various sectors via a holding company.

Types of UAE Holding Companies

In UAE, one can set up different types of holding companies such as –

1. The Onshore Holding Company
2. The Free Zone Holding Company

Depending on the business structure, the holding company must appoint at least one director or a board of directors. Foreign investors can also register partnerships as holding companies in Dubai.

Requirements for Establishing up a Holding Company in UAE

Every UAE based company, holding or not, must follow the rules under the Company Law. Holding Companies must cover the following –

• Setting a management board that will be in charge of the creation of rules and regulations and organization of subsidiaries
• The board will supervise the activities of the subsidiaries
• The holding company shareholders must have a director in each subsidiary firm
• The company must make sure that the subsidiaries have the much-needed capital to operate successfully
• The company must set limits in terms of the risks subsidiaries can take such as foreign currency and other industry risks
• The holding decides terms of arrangements and contracts of the subsidiaries

How to Register a Holding Company in UAE?

Here are a few things to know before registering your holding company in UAE –

1.Selecting a Right Location

A company needs to select the right location in UAE so that it allows the company to get the right consumers and clients quickly to boost the business sales. Hence, research is essential to ensure that you buy the right location or rent it according to your business plans.

2.Requirements of Registration

There are no official necessities when you are starting your company in UAE. Still, it is suggested that you have legal written agreements that can allow protecting your business when you are in legal problems. The written agreements and documents are like contracts among the stakeholders that are drafted to conform their terms to substantive matters.

3.Choosing the Right Business Consultant in UAE

If you are not aware of the rules and regulations of the UAE business world, then you will need to find a business consultant that can help you with the experience and expertise that they have. This will help you to get ahead with business registration and setup quickly rather than getting involved in all the complications that you might find strange.

Where can you set up your Holding Business in UAE?

One of the best places to set up your holding company in UAE is the Ras Al Khaimah Economic Zone (RAKEZ). It is a leading free zone in the region for business, lifestyle and all kinds of activities. RAKEZ holding companies can be used to hold assets within the Emirates, the GCC, or anywhere else globally. These include real property and shares in other companies in the UAE and worldwide.

Advantages of Setting up your Holding Company in RAKEZ

• 100% foreign ownership is allowed
• No restrictions on capital repatriation
• No restriction on foreign employees
• Zero tax for 50 years on profits, capital or assets
• Zero tax on personal income
• High prominence in deal-making in the region
• The concentration of international financial institutions
• World-class regional and international professional services
• The leading fund domicile in the region
• Well-positioned to harness the potential of emerging markets
• Highly regarded, the independent regulator
• No minimum share capital requirement
• GCC Management offices, holding companies and family offices are located closer to the assets they own or manage

With the United Arab Emirates becoming more and more popular with ex-pats as a place to live and work, owning a property through a holding company makes good business sense in more ways than one.

How long does it takes for a holding company to be incorporated in UAE?

Approximately between 1 to 2 weeks.

Why you should form a holding company?

• It is an excellent tax optimization solution, as it is not imposed with any tax.
• The holding company can also be a good asset protection solution for foreign entrepreneurs;
• Through a holding company, a local or foreign investor can benefit from enhanced privacy;
• It also offers streamlined management procedures with respect to the subsidiaries.
• There is no minimum share capital requirement

Contact mail@shalban.co for a free consultation.