UAE free zone: Offshore vs Onshore

United Arab Emirates consists of 7 Emirates. Each of them has its own rules. Thus, company formation in Dubai will be different from company formation in Abu Dhabi. United Arab Emirates consists of 7 Emirates. Each of them has its own rules. Thus, company formation in Dubai will be different from company formation in Abu Dhabi.

Besides that there are different options for companies set-up:

Free Trade Zone Offshore companies. If you do not run your business in Dubai, this will be the most cost efficient solution. This company can have bank account in Dubai. Restrictions: it cannot have physical office in Dubai; all business activities must be outside UAE; you cannot receive resident visa with such company.

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Free Trade Zone Onshore companies. The company will be registered in one of the UAE Free Trade Zones (there are about 30 of those).

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Local Non-Free Trade Zone companies – for business activities that will take place in Dubai. You will have to set-up your own office and wear house facilities. You need to have local shareholder and local sponsor

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Note: It is not possible to change status of the company from Free zone offshore to Free zone onshore company. The companies have different legal status and regulations.

TO SUMMARIZE:

Setting-up company in UAE whether Offshore or Onshore is not harder than in other jurisdictions. Whether applying for license for Onshore companies or opening bank account in UAE bank for Offshore or Onshore, preparing audited financial statement – with professional approach any task is manageable in hands of experience registered agent.

Despite full tax exemption UAE companies are not commonly regarded as tax havens. They by far have solid reputation compared to classic offshores.

UAE banks have long standing reputation of confidentiality and stability.

Information of UAE companies owners is not public. Thus both types of entities – Offshore and Onshore – are valuable instruments in terms of confidentiality and assets protection.