Dubai, the City of Gold, the commercial capital of the Middle East, is a melting pot of diversity. The city has a predominantly expat population from over 100 nations worldwide. The presence of both business-friendly laws and liberal tax incentives attracts a huge number of entrepreneurs every year. Among the many businesses that are formed each year in the UAE, there is one that is extremely popular. Joint venture company formation in Dubai is the preferred choice of several foreign investors. Opening a joint venture company in Dubai shares the same advantages that come with a Limited Liability Company in Dubai.
Here is a complete breakdown of the process of joint venture company formation in Dubai, including the documents, its features, and advantages.
What are Joint Venture Companies?
The joint venture company is one of the forms of doing business in Dubai, as it allows one or more foreign investors to come together to conduct a particular business activity of their choice. This commercial agreement can take place between two or more participants with the aim of achieving select business goals, generally to break into a new market.
Features of a Joint Venture Company in Dubai
Joint ventures in Dubai have several distinctive features that make them different from the traditional means of company formation.
- There is no limit to the number of entities that can come together in collaboration for the joint venture
- Investors can come to a mutual agreement regarding profit and loss distribution
- It is a preferable legal structure for companies that come together to work on specific projects
How to set up a joint venture company in Dubai?
Because of its unique disposition, joint venture company formation in Dubai falls under the domain of the Department of Economic Development (DED) and the Dubai Municipality. They are responsible for reviewing and approving the business for the joint venture. Even though you do not need to apply for a separate trade license, there are certain steps you need to follow to register your joint venture company in Dubai.
- Foremost, all parties involved must register a Joint Venture Partnership Agreement with the Dubai DED
- They will also need to finalise the business activities they want to conduct as well as the trade name
- Then, the DED issues a form that all parties involved must sign before a public notary
- After the contract is drafted, you will need to get an initial approval from the DED
- After the approval, you will need to submit any additional documents the DED may require
- The final step is to pay the license fees
Documents for Initial Approval:
- Application form (Filled)
- Reserved Trade Name Certificate
- Passport copies/ID of all applicants
- Local sponsor’s NOC
- Approval for chosen business activities
- Resolution issued by company management board
- Dubai residence permit (for foreign applicants)
Companies that are looking to crack their business activities into a new region generally prefer the approach of a joint venture to kickstart their operational beginnings. In such a situation, it is important to find the right business partner. Only then will there be a significant opportunity to generate and increase your profits.
Benefits of a Joint Venture Company
The biggest advantage of starting a joint venture company in Dubai is that two entities come together with their shared market knowledge and access to the latest technological advancements. Additionally, Dubai’s business friendly environment, tax liberties and innovative administration make it more attractive to foreign investors. The partners’ experience can therefore become a crucial asset in ensuring the growth of any joint venture company.
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With the UAE on the cusp of becoming the Middle East financial leader, Dubai is set to be its crown jewel. Dubai’s strategic location and the presence of extremely well-equipped sea and airports provide greater commercial visibility. Business setup in Dubai, UAE is booming across all sectors. Every year, thousands of expats come to Dubai in the hopes of making the next big thing.
Shuraa Business Setup guides you through the entire joint venture company formation process in Dubai with the backing of 22+ years of business setup experience. Experience world class services, speedy government processing, ensured PRO and visa services, and everything you need to start the venture of your dreams. Contact Shuraa and get a FREE consultation with our seasoned business setup consultants in Dubai.
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