Dubai, the commercial capital of the United Arab Emirates is often regarded as the ‘city of gold’ as it provides vast business opportunities and innovative commercial modules for enterprises from around the world. In a nutshell, international exposure and an investor-friendly government are the two important factors that motivate entrepreneurs to start a business in Dubai.
Joint Venture in Dubai is an agreement between a foreign party and a local party licensed to engage in the desired activity. The local equity participation in the joint venture must be at least 51% but the profit and loss distribution is prescribed. In a joint venture, both the parties agree to co-operate with each other and term of the joint venture may be defined or open. The parties in the joint venture agreement generally agree to certain timelines and milestones and subject to milestones being achieved.
Joint ventures as a corporate entity is one of the most preferred choice globally given the flexibility offered by the mechanism. This type of corporate entity in the UAE are recognized and regulated pursuant to the UAE Commercial Companies Law.
Once both the parties agree upon the joint venture in Dubai, they must register the agreement with the Department of Economic Development (DED). The steps to register your business are as follows.
Foreign applicants must also submit the Dubai residence permit. Also, a resolution pass by the foreign company’s management board will be required
One of the greatest advantages of starting a joint venture is no compulsion of licensing as the local partner will have a business license to carry out the activity. There are many reasons to invest in Dubai, and even if it is a foreign place for you, the local contribution coming from your partner is going to be extremely helpful by giving your company increased access to the new market. Hence, joint venture is the way to go as it is safe especially when you are entering a new market.
Business Setup Worldwide is a platform to help you start a business in Dubai and UAE. We provide you with all kinds of services right from company registration to visa and taxation. Contact us today- we’d be glad to assist you.