Limited Liability Company

When two or more persons undertake to participate in an economic activity which is intended to make profits, by each providing a share of funds or efforts and to divide the profits or losses resulting from the profits or losses resulting from the activity between them.

The economic activity shall include every commercial, financial, industrial, agricultural, real estate or any other type of economic activities. In the UAE a company must establish in the below forms:

  1. Joint Liability Company
  2. Simple Commandite Company ( Limited Partnership)
  3. Joint Venture Company
  4. Private Joint Stock Company
  5. Public Joint Stock Company
  6. Limited Liability Company
  7. Share Commandite Company

Any company which does not adopt one of the forms mentioned above will be considered as void.

A limited liability company is a company which is consists of minimum of two (2) partners and which shall not exceed fifty (50), where the partner is liable only to the extent of its share in the capital. While comparing with the other forms of the companies Limited Liability Company is most common and easy to establish. The rules to establish an LLC is very simple. The company must have 51% participation from a UAE national while the rest 49% can remain with the investor (Foreign Shareholder).  The operations of the organization are managed by either of the UAE national or the foreign partner.

All cash and in-kind shares mentioned in the company’s Incorporation Contract shall be distributed among the partners and the value of the each share must be paid up in full at the time of incorporation. The cash contributions shall be deposited in one of the banks operating in the state.


The MOA of an LLC shall include:

  1. Full name, nationality, date of birth and domicile of each partner
  2. The name, address and trade name of the company and the objective for which it was established
  3. The head office and branches of the company, if any
  4. The capital and the shares of each partner along with the estimated value of such shares, the means by which they are assessed and the date of their falling due
  5. The enforcement and termination date of the company, if applicable
  6. The method by which the company is to be managed with the particulars of the names of those persons who may sign on behalf of the company and the extent of their authority
  7. The commencement date and the expiry date of the financial year
  8. The rate of distributing profits and losses
  9. The conditions of assignment of shares in the company, if any

If the MOA of the company contains the name (s) of the manager (s), the full name, nationality, place of residence and authority of each such manager shall be stated.

Establishment of LLC

The below steps to be followed while Establishing an LLC:

  1. Selecting a company name which is useful in conducting the business which will be sent to the approval from the licensing department.
  2. The framing of a Memorandum of Association duly attested by a notary public.
  3. Approval from the Economic Department along with the entry in the commercial register.
  4. After getting an approval, a formal entry of the company is made in the company register.
  5. Publication of company’s MOA in the bulletin of the Economy and Commerce Ministry.
  6. A license is issued by the Economic Department after completing the above steps.
  7. Finally, the company is registered with the authorized Industry and commerce department.

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