Holding Company in Dubai: Procedure & Requirements

In this article, we have discussed about how to open a holding company in Dubai. Read the Complete article to know more about procedure and requirement for it.


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    Holding Company in Dubai

    Dubai, the vibrant and bustling hub of the United Arab Emirates, has long been a magnet for business entrepreneurs and investors seeking lucrative opportunities in the Middle East. A Holding Company is one of the most important ways to create a corporate presence in Dubai. In this comprehensive guide, we will delve into the world of Holding Companies in Dubai, exploring the procedures, requirements, types of business entities, and the multitude of benefits that await those who choose this path.

    What is a Holding Company in Dubai?

    A Holding Company is essentially a commercial company whose principal aim is to own and control other firms known as subsidiaries.  It plays a crucial role in corporate structures, facilitating efficient management and strategic decision-making. In Dubai, Holding Companies are highly favoured for their tax advantages, asset protection, and the myriad of opportunities they offer.

    Procedure for Setting up a Holding Company in Dubai

    Setting up a Holding Company in Dubai involves a well-defined procedure that is designed to ensure transparency and adherence to legal requirements. Here’s a step-by-step guide to get you started:

    • Choose a Business Activity: Determine the specific business activity you wish to engage in as a Holding Company. This could be anything from investments in various sectors to holding intellectual property rights.
    • Select the Appropriate Legal Structure: Dubai provides multiple legal forms for Holding Companies, including Limited Liability Companies (LLC), Free Zone Companies, and Offshore Companies. The option you select is determined by your business objectives as well as the level of control and ownership you desire.
    • Reserve a Trade Name: Choose a distinctive and appropriate trade name for your Holding Company while adhering to the Department of Economic Development’s (DED) criteria.
    • Draft a Memorandum of Association (MOA): Prepare a Memorandum of Association, outlining the company’s objectives, capital, and ownership structure. This document must be notarized before being submitted to the DED.
    • Obtain Approvals and Licenses: Specific approvals and licences may be required depending on your chosen company activity and location. Approvals from government agencies, free zone authorities, or specialized regulatory bodies are examples of this.
    • Lease Office Space: If required, lease office space that complies with the legal requirements of your chosen business structure.
    • Bank Account Opening: Open a corporate bank account with a respected UAE bank, as this is required for doing business in Dubai.
    • Visa and Employee Sponsorship: If you intend to hire workers, you must get visas and sponsor their residency in Dubai.
    • Registration and License Issuance: Submit all required documents to the relevant authorities and obtain your Holding Company’s trade license.
    • Compliance and Reporting: Ensure ongoing compliance with Dubai’s regulatory requirements, including annual financial audits and reporting.

    Requirements for Start a Dubai Holding Company

    To successfully establish a Holding Company in Dubai, you must meet certain requirements:

    • Minimum Capital: The minimum capital requirement varies depending on the chosen legal structure. For example, Free Zone Holding Companies typically require a minimum capital investment.
    • Local Sponsorship: In certain legal structures, such as LLCs, you may need to have a local sponsor who holds a minority share (typically 51%) in your company. However, this can be negotiated to protect your control and interests.
    • Office Space: You must lease office space in Dubai, even if it’s a virtual office, to have a physical presence as required by law.
    • Compliance: The importance of adhering to UAE laws and regulations cannot be overstated. Any violation can lead to penalties or legal consequences.
    • Financial Statements: Keep accurate financial records and plan for annual financial audits.
    • Visa Requirements: Fulfill the visa requirements for you and your employees, if applicable.

    Types of Business Entities for Holding Companies in Dubai

    Dubai has several legal structures for holding companies, each of which caters to particular business needs and objectives. Here are a few examples of the most prevalent types:

    • Limited Liability Company (LLC): An LLC is a popular choice for entrepreneurs looking to establish a Holding Company in Dubai. It offers flexibility, control, and limited liability for shareholders. However, it may require a local sponsor to hold 51% of the shares.
    • Free Zone Company: In Dubai, free zones are defined regions that offer tax breaks and 100% foreign ownership. Setting up a Holding Company in a free zone can be advantageous for those seeking full control and preferential tax treatment.
    • Offshore Company: Dubai offshore companies are registered in a free zone known as the Jebel Ali Free Zone Authority (JAFZA). These companies are ideal for holding intellectual property rights, investments, and international businesses. They offer 100% foreign ownership and tax exemptions.
    • Branch of a Foreign Company: You can set up a branch office if you currently have a foreign firm and want to have a presence in Dubai without founding a separate corporation. The branch is treated as an extension of the parent firm and has complete control.

    The Advantages of Creating a Holding Company in Dubai

    Let’s explore the numerous benefits of establishing a Holding Company in Dubai:

    Tax Advantages: Dubai is known for its favourable tax climate, which makes it an appealing location for Holding Companies. Key benefits include:

    • Zero Corporate Tax: Holding Companies in Dubai typically enjoy zero corporate tax on profits and capital gains.
    • Double Tax Treaties: Dubai has a network of double tax treaties with over 90 countries, reducing the risk of double taxation on income generated abroad.

    Asset Protection: Holding Companies provide a robust framework for asset protection and risk management:

    • Limited Liability: The liability of shareholders is limited to their investment in the corporation, thereby protecting personal assets.
    • Control and Diversification: Holding Companies allow for centralized control over subsidiary companies, facilitating strategic decision-making and diversification of investments.

    Wealth Management: Dubai is an excellent location for wealth management and succession planning:

    • Estate Planning: Holding Companies can serve as a vehicle for estate planning, allowing for the seamless transfer of assets to heirs.
    • Confidentiality: Dubai offers a high level of confidentiality for shareholders and beneficial owners.

    Strategic Location: Dubai’s strategic location between Europe, Asia, and Africa positions Holding Companies for global expansion:

    • Access to Emerging Markets: Dubai serves as a gateway to emerging markets in the Middle East, Africa, and Asia.
    • Global Connectivity: World-class infrastructure, ports, and airports ensure seamless international trade and commerce.

    Business Growth: Dubai’s dynamic business environment fosters growth and innovation:

    • Access to Talent: Dubai attracts a wide range of qualified people from all over the world.
    • Financial Hub: Dubai is a financial hub with access to a wide range of banking and financing options.

    Conclusion: How OnDemand International Can Help

    Establishing a Holding Company in Dubai offers a plethora of advantages, from tax benefits to asset protection and global expansion opportunities. However, navigating the complex procedures and regulatory requirements can be challenging. That’s where OnDemand International comes in.

    OnDemand International is a leading consultancy firm specializing in business setup and corporate services in Dubai and the UAE. With our expertise and in-depth knowledge of the local business landscape, we can guide you through every step of the process,


    The holding company can be formed in a matter of weeks.

    A Dubai holding company does not require any share capital to be established.

    A Dubai holding company does not require any share capital to be established.