Registering a branch of a foreign company without the need to UAE local sponsor

Ever since hints were dropped about foreign businesses not needing UAE local sponsors, a lot of foreign investors and entrepreneurs have been looking forward to the implementation of this new ruling.

To boost the country's competitive edge, the amended Commercial Companies Law allows company formation in Dubai by foreign nationals or companies and no longer required to have at least 51% UAE resident shareholders to register a branch and perform business activities in the emirates. 

The move has been anticipated for a long time and is expected to have a major effect on UAE's global standing. Along with the change, business setup in Dubai has become easier, especially for foreign investors who are looking for ways to grow their business during these difficult times. However, there are still requirements and guidelines that foreign companies must follow to start doing business activities in Dubai. 

Whether you're planning on establishing a new business or opening another branch to expand your business in the UAE, it is always recommended that you work with business setup consultants in Dubai to help you make guided decisions for the company. Just because it's easier to start a company now, this doesn't mean that you can throw caution to the wind when it comes to growing your business in the UEA. Be mindful of the guidelines and make sure you obtain all necessary paperwork and permits/licenses to legally operate in the country. While requirements may vary, you might be asked to submit the following:

● Completed application form

● Business plan

● Passport copies of shareholders/directors

● Specimen signatures of shareholders/directors

● Letter of intent

For licensing, you need to provide the following:

● Board resolution appointing a company manager/director

● Power of attorney given to manager/director

● Memorandum and articles of association

● Specimen signature of manager/director

● Photo of manager/director

● Share capital information

If you don't have enough time to familiarize yourself with the new guidelines and requirements, you may hire a legal consultant in Dubai to who can give you a walkthrough of the legalities in establishing a branch in the UAE, as well as help you determine problems that you may encounter in the future as the business grows. 

If you're a foreign national who needs legal advice in establishing a new branch for your business in Dubai or you need advice for an ideal business setup in the city, Motei & Associates can provide you with excellent legal services to meet the requirements of your business.

Free zone vs. Offshore Company

One of the most common issues encountered by business owners are entrepreneurs who wish to set up their business in Dubai is choosing between establishing a free zone or offshore company.

While both types have their own advantages and disadvantages, knowing the difference between each is crucial in deciding which option is a better fit for your business. Whether it's your first time to establish a business or you're new to this industry, here are some of the important details you need to consider about free zone and offshore companies for your business setup in Dubai.

Location of business operations

Free zone companies in Dubai and the UAE are allowed to conduct their business in the free zone if they meet the requirements for company formation in Dubai. They can be 100% owned by foreign investors and there is no need to have UAE nationals as shareholders.

Additionally, free zone companies are usually exempted from paying income and corporate taxes. These companies, however, are required to register with the Federal Tax Authority for the payment of Value Added Tax and other payments mandated by the law.

Offshore companies, while allowed to open bank accounts in the free zone or anywhere in Dubai, are not allowed to perform business activities or establish their office in the Emirate. Offshore companies may only operate outside the UAE. If you're considering a new venture in any of the emirates, you may enlist the help of business setup consultants in Dubai to discuss your options.

Residency and visas

Free zone companies and businesses may obtain residence visas for their shareholders and employees. Residency is sometimes included in the package to encourage investors and employees to join the company. The validity of visas may vary for different businesses in the free zone, but visa holders may process the renewal upon expiry.

Unfortunately, it is not possible for shareholders or employees to obtain residence visas under any offshore company. Since offshore companies are not allowed to do business in the emirate other than owning assets, you may need the help of a legal consultant in Dubai to know which type of visa you may apply for.

Costing

The cost establishing a business inside the free zone may vary depending on the location and reputation of the area or building. The number of UAE residence visas allocated, and other factors may also affect the cost of forming your company.

Establishing an offshore company is often cheaper depending on the area of incorporation. Aside from yearly corporate expenses, you may also investigate maintenance costs and other factors where you will need to allocate your resources. 

If you need legal advice in setting up a business in Dubai or advice on obtaining residence visas for shareholders and employees, Motei & Associates can provide you with excellent legal services to meet the requirements of your business.

Benefits of Hiring a Law Firm

 Starting a company is not all about concepts and tasks you need to accomplish or delegate to your staff. In fact, you can't operate your business without taking care of the legal matters first. To ensure that you are on the right track with the procedures and paperwork, you may book an appointment with a legal consultant in Dubai.

What are the benefits of hiring a law firm?

Knowledge of legal processes

As mentioned above, there are procedures that you need to follow to start operating legally in the country. Having a lawyer on your side will help get all the necessary paperwork and legal documents in order. He or she can help you develop a strategy on which documents you need to secure first to ensure the procedures don't take as much time and work on more important things.

 

Write and peruse contacts and other legal documents

When you are ready to hire more people to grow your business, you will need to create contracts for your employees, partners, or shareholders. Corporate lawyers in Dubai can assist you in creating the contracts and perusing its parts to make sure it does not violate any laws or your future staff or partner's rights. They can also advise on what other information you should include in the contract aside from duties, responsibilities, and benefits.

 

Protect you and your employees from lawsuits

Several instances may lead to lawsuits, including (but not limited to) termination, harassment, violations, and failure to provide employee benefits. When dealing with such delicate cases, hiring law firms in UAE can be beneficial as you can get advice and help from more than one lawyer. Even if the entire group isn't always present in hearings or negotiations, they can still provide valuable advice and insight into resolving the issue. 

 

Assist in restructuring and scaling the business

As your business continues to grow, you may need to make some changes in the company's day-to-day operations and change the roles and responsibilities of your employees. Working with legal firms in UAE can make the transition easier for you since they can review existing contracts and documents to create new ones with updated roles, responsibilities or policies.

 

If you need help understanding legal processes to start your business or advice in creating contracts for your employees or partners, contact Motei & Associates, they can provide you with the legal services you require.

 

Main Options For Dispute Resolution In Dubai

Amicable Settlement Centre (ASC)

Any property attorney would recommend that filing a claim with the Courts should be the last resort when solving real estate disputes. Simply because there is so much money and time involved. One efficient option is to refer the dispute to the ASC at the Dubai Land Department (DLD), managed by a legal team. Mediators at the ASC have access to DLD databases. Thus, they can quickly obtain information about projects, properties, developers, and other real estate facts. They are very experienced and do not charge fees to the parties. Rather than impose a judgment, the ASC seeks to mediate until an amicable settlement is reached. Once resolved, the signed agreement becomes binding and enforceable.

 

Rent Disputes Settlement Centre (RDSC)

The RDSC holds exclusive jurisdiction over Dubai tenancy disputes about the leasing of immovable assets. They have a mediation department that aims to resolve disputes between tenants and landlords before referring the case to Court. The RDSC charges around AED 15,000 to AED 35,000 for filing a lawsuit, depending on the claim's nature. The litigation process is quite fast, wherein a judgment can be obtained between 2 to 3 months. However, the RDSC does not have jurisdiction over leases exceeding 10 years (long-term leases) and lease-to-own contracts. The RDSC also doesn't have jurisdiction over tenancy disputes in free zones because of a judicial committee within the Dubai International Financial Centre (DIFC).

 

Judicial Committee for Liquidation of stalled projects (JCL)

For disputes involving stalled projects, legal consultants in Dubai refer to the JCL. The agency was formed according to Decree No 21 of 2013 to liquidate stalled projects. Investors can lodge their claims via the JCL's designated website. The agency has not specified rules or procedures regarding the liquidation process, but it is known that there are complexities involved in such projects. The JCL has a wide authority, and any decision they make is final.

 

DLD Legal Affairs Department (DLD Legal)

Disputes that involve the termination of sale and purchase agreement can be resolved through the DLD Legal. Dubai Law No. 19 of 2017 grants developers the right to terminate a defaulting purchaser's sale and purchase agreement upon satisfying specific conditions. The termination process takes around 3 to 4 months and can be completed via DLD Legal’s online system. They charge a service fee of AED 3,000. DLD Legal also has the authority to mediate an amicable settlement between the defaulting purchaser and developer.

 

Dubai Property Court

If involved parties don't reach an amicable settlement, that's when they can take it to Court with a real estate lawyer. The Court has jurisdiction over all property disputes, except those excluded according to other decrees or laws. It has 3 levels, including First Instance, Court of Appeal, and Court of Cassation. Obtaining an enforceable judgment can take up to 2 years or more if necessary, to appeal to all levels. Fees for filing a case before the Court of First Instance can reach up to AED 40,000 or more if the dispute involves multiple contracts. Also, all documents submitted should be in Arabic or translated to Arabic.

 

When it comes to property disputes, you need a legal expert to help you navigate the negotiations and provide insightful advice. Make the right choice and talk to the lawyers of Motei & Associates. They have vast local knowledge and continued awareness of the real estate market in the UAE. Book an appointment today at +971 4 435 5959!

Tips in dealing with tenant maintenance issues

 Fix issues beforehand - Even before the rental agreement gets signed, it pays as a landlord to have a move-in ready property. Tenants usually request for a space equipped with appliances that are up to standard. Thus, it is worth resolving issues like a broken air conditioning unit or a leaking faucet before the move-in so your relationship with the tenant starts on the right foot.    

Prevent major damages - No property is immune to minor damages, but you can find ways to prevent them from worsening. List down potential problems that could happen and the solutions for each one. For instance, sand storms in Dubai may cause air conditioners to malfunction. So, you should look for guards to prevent this type of damage even before renting out space. 

Conduct an inventory - Before the move-in date, conduct another inspection with the tenant to determine which are genuine complaints and which are due to negligence. More so, keep the tenant aware of problems that may recur after a certain period and the steps you've taken to rectify the situation. 

...continue reading

ARE YOU IN A LEGAL DISPUTE? OR WONDERING IF YOU HAVE GROUNDS TO FILE A LAWSUIT? 

Check out some informative articles that may help you:

• Renewing Tenancy Contract in Dubai
• Resolve Property Disputes in Dubai
• Real Estate Agent vs Real Estate Lawyer
• Is it advisable to engage your lawyer when selling a property?
• Thinking of buying an off-plan property? Get a lawyer

Motei and Associates has the finest real estate lawyers Dubai has seen, offering disputes resolution and general corporate, commercial transactional services. Give them a call today at +971 4 435 5959. 

Breach of Real Estate Contract

Buying or selling real estate is a serious business. It involves a lot of money and a valued property. Thus, it is essential to talk to a legal consultant in Dubai to know how to put legal safeguards in place.

A real estate contract provides protection for both the buyer and seller. It is a binding agreement between two parties regarding the transfer of a home or property. The deal needs to meet specific requirements to be valid - the purchase agreement must be in writing, contain an offer and an acceptance, the purpose must be legal, and there must be an exchange of things of value (money for the property).

A breach of contract occurs when one of the parties to the contract fails to perform any of the stated terms. Upon signing the contract with the buyer, it’s reasonable to expect that all responsibilities will be fulfilled. But a buyer can break a contract for a myriad of reasons, mainly if the cost of going through the contract is more than the cost of penalties for breaching it. It’s best to be prepared by finding the right lawyer in Dubai who can help you understand the process.

Here are some ways that a breach of real estate contract by a buyer can occur:

●       The buyer fails to obtain adequate financing before the closing date.

●       The buyer is unable to sell their current home before closing on the new home, and therefore cannot go through with the purchase.

●       The buyer fails to deliver the deed of the property correctly.

...continue reading

ARE YOU IN A LEGAL DISPUTE? OR WONDERING IF YOU HAVE GROUNDS TO FILE A LAWSUIT? 

Check out some informative articles that may help you:

• Renewing Tenancy Contract in Dubai
• Resolve Property Disputes in Dubai
• Real Estate Agent vs Real Estate Lawyer
• Is it advisable to engage your lawyer when selling a property?
• Thinking of buying an off-plan property? Get a lawyer

Motei and Associates has the finest real estate lawyers Dubai has seen, offering disputes resolution and general corporate, commercial transactional services. Give them a call today at +971 4 435 5959.