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Why should you form a Professional Liense?

At Fortunum we recommend that you opt for a Professiona License if the business you are about to start will engage in providing Services to your clients.  You should form a Professional License if you are going to provide such services as Web Designing, Management Consulting etc.  There are many activities which fall under the Professional License category.

If the activity or activities you have chosen for your business fall under the "Profession License" category, then you can opt to retain 100% ownership in your business. You will still need a U.A.E. National Sponsor whom we will provide, but this time, the Sponsor will not own any shares in your business.  He is simply an "Agent" who represents you in front of the U.A.E. Government for such things as Visas, Work Permits, License Renewals etc.

To inquire on how Fortunum can help you set up and incorporate a Professional License in Dubai, pelase click here.

Where should you incorporate your Professional License?

Fortunum can incorporate / set-up a Professional License in one of three ways for you;

1. A Professional License formed as a Sole Establishment (the term used in Dubai for a Sole Proprietorship)
2. If you have more than one owner, Fortunum can set up a Professional License as a "Civil Company" which is similar to a "Partnership."
3. A Professional License incorporated within one of the numerous Free Zones in the U.A.E.
4. A Professional License set up as a Branch of a Foreign Company

Incorporating a Professional License as a Sole Establishment (One Owner)

• U.A.E. law and Dubai law state that a Sole Establishment must have just one owner.  This owner can be either a foreigner or a U.A.E. National.  The Establishment Owner (the Sole Proprietor) carries the full 100% liability of the incorporated company.  In this way, the Sole Establishment is similar to comparable structures in the rest of the world which place 100% liability with the owner of the business.  Even then, the Sole Establishment is a very popular form of company in Dubai.  The reason is very simple, there is no law which requires a U.A.E. National to take a majority stake in a Sole Establishment.  In fact, a foreigner can own 100% of a Sole Establishment.  The downside to the 100% ownership rule is that foreigners can form a Sole Establishment only if they are going to be providing services AND NOT buying and selling goods.

Incorporating a Professional License as a Civil Company (more than One Owner)

• A Professional License can be set up as a Civil Company if there are 2 or more owners who wish to jointly form the company.  The Civil Company structure is really a Partnership and the Partners share the full 100% liability of the company.  Besides the ownership feature, a Civil Company is run and maintained very similar to the Sole Establishment.

A Professional License formed within one of the numerous Free Zones in the U.A.E.

• You can also form a Professional License within one of the many free zones found in Dubai and the other Emirates in the U.A.E.  The only reason you should choose to form your Professional License within one of the free zones is when the free zone provides dedicated services for the activity you are about to engage in.  For example, the Dubai Media City is a well known destination for media and advertising companies.  Since the 100% foreign ownership structure is extended to non-free zone companies if they are forming a Professional License, there is not much justification for choosing a Free Zone to set up a Professional License.

• You should consider obtaining a Professional License within a Free Zone ONLY IF you plan to EXPORT your services or provide your services to clients outside the U.A.E..  That being said, this is a rule that is regularly flouted, often openly as the authorities have yet to show any inclination towards restricting Professional Licenses set up in the free zone to conduct business only within the free zone.  The practice of incorporating a Professional License within the free zone and providing services to companies outside the free zone is a well-established practice int the U.A.E.

A Professional License Incorporated as a Branch of a Foreign Company

• At Fortunum, we regularly incorporate Professional Licenses as a Branch of a Foreign Company.  There are many reasons why our clients ask us to do this.  Here are some of the main reasons why;

• A Professional License only allows a maximum of 50 partners and some of our clients have more than 50 partners.  In this case, the offshore company will hold the 50 plus partners, and only a few representative partners hold managerial positions in the Dubai Branch.

• Dubai and the U.A.E. have some pretty strict naming rules for companies.  If you wish to circumvent these rules, then the way to go is through a Branch of a Foreign Company.  By law the U.A.E. Branch must carry the same name as the Foreign Head Office.

To send us an "Obligation-Free-Inquiry" or to chat with one of our Expert Consultants, please click here.

Frequently Asked Questions about the Commercial License

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