DMCC Business Support Package

Dubai Business support package

Dubai Multi Commodities Center (DMCC), the world’s flagship Free Zone and Government of Dubai on commodities trade and enterprise has recently announced the roll out of a “Business Support Package”, to support and safeguard the business interests of its members during these difficult times.

Effective from 1st April to 30th June 2020, existing DMCC members can get exclusive support as such:

  • Waiver of late license renewal penalties
  • Waiver of office sharing permit fee
  • Waiver of all Flexi Desk and DMCC Business Centre Penalties
  • Discount on license renewal
  • 3 months’ rent holiday for Flexi Desk and DMCC Business Centre tenant’s renewal (this is applicable for those who are due for renewal during the offer period).

However, all existing offers will be discontinued during this period and for all businesses with activities suspended due to official UAE Government Policy on Covid 19. This offer is extended and valid until 30 September. Terms and conditions apply.

For any further enquiries and assistance, please feel free to contact our team at mail@affiniax.com.

Why set up a business in Hamriyah Free Zone?

Cheapest Business set up cost UAE

Established on November 12. 1995, the Hamriyah Free Zone is home to more than 6,500 businesses from 163 countries. In addition to world-class facilities including offices, warehouses, factories and executive office suites, Hamriyah Free Zone also has over 15 on-site key business services, like banking and auditing firms, currency exchanges, conference rooms, staff accommodation, and more.

Sharjah is the only Emirate to have ports on the coast of both the Arabian Gulf and the Arabian Sea, providing the Free Zone with a huge strategic advantage as it has the capability of servicing three continents- and over 1.5 billion people- due to its unique positioning. Businesses located at the Hamriyah Free Zone can take advantage of the numerous shipping networks that pass through Sharjah, as well as the state-of-the-art technology and range of cargo containers at the Port and the Depot.

Due to its strategic benefits the Hamriyah Free Zone is home to the largest number of Steel fabricators in the UAE, as well as being a hub for oil and gas companies and transportation and logistics companies. There is also an 11 million square feet Food Park specifically planned and developed for the requirements of the food industry.

Its 26 million square metres of prime industrial land make it an ideal location for heavy industries, while its abundance of land and warehouse facilities have made it extremely popular amongst manufacturers of building materials.

Hamriyah Free Zone has built a world-class infrastructure in order to ensure that the businesses set up there have all the tools necessary in order to succeed.In addition to that, the Hamriyah Free Zone Authority (HFZA) has brought a special discount on E-office packages. The first-ever HFZA exclusive discount is commencing from 1st March to 31st May 2020 and will offer a discount of up to 15% on below annual packages.

PACKAGE 2 Normal Price AED 17,000 Yearly Promotional Price AED 15,300 10% Discount
Free Zone Establishment (1 Shareholder)
 
10sqm Office.
 
Up to 3 service activities
 
Provision to apply for 4 visas*
PACKAGE 3 Normal Price AED 20,000 Yearly Promotional Price AED 18,000 10% Discount
FZE/FZC (1-3 Shareholders)
 
10sqm Office.
 
Up to 3 service activities
 
Provision to apply for 4 visas*
PACKAGE 4 Normal Price AED 25,000 Yearly Promotional Price AED 21,250 15% Discount
FZE/FZC (1-5 Shareholders)
 
10sqm Office.
 
Up to 5 service activities
 
Provision to apply for 6 visas*
PACKAGE 4 Normal Price AED 35,000 Yearly Promotional Price AED 29,750 15% Discount
FZE/FZC (1-5 Shareholders)
 
10sqm Office.
 
1 General Trading activity
 
PProvision to apply for 7 visas*

*Visa related costs are not included in package price.
All packages include:
1. Office rent for 1 year.
2. License fee for 1 year.
3. Name approval charges.
4. Service charges (office, electricity and maintenance).
To know more about this exclusive offer, get in touch with one of our team members at mail@affiniax.com or call us on +971 4 425 6616.

NEWLY INTRODUCED, RAK ICC FOUNDATIONS

With the continuous vision to achieve global brand recognition as a premium jurisdiction for the provision of Company formation services, Ras Al Khaimah International Corporate Centre has recently introduced its new product, the RAK ICC Foundation.

The RAK ICC Foundation is a corporate body created with a legal personality separate from that of its Founder(s) registered at RAK ICC. The Foundation acts through its council to administer its assets and carry out its objectives. Offshore foundations are commonly used as a vehicle for asset protection, estate planning, as well as wealth management. Such foundations have many advantages and the Foundation has been set up in a jurisdiction governed by offshore legislation.

The key benefits and advantages of the RAK ICC Foundation are:
  • Enhanced succession planning and asset protection
  • Robust governance structure
  • Guardian oversight
  • Distinct legal personality that separates liability whilst maintaining control of assets and have perpetual existence after the lifetime of the Founder
  • Governance
  • Continuity
The RAK ICC Foundation Regulations 2019 are made by the board of directors of RAK ICC pursuant to Ras Al Khaimah Decree No.4 of 2016. For further enquiries and information please feel free to contact our team at mail@affiniax.com or call us on +971 4 425 6616. Affiniax A A S Auditors a Registered Agent of Ras Al Khaimah International Corporate Centre.

DMCC – NEW RULES & REGULATIONS TO ENHANCE EASE OF DOING BUSINESS

Dubai Multi Commodities Centre (DMCC) – the region’s leading trade hub– has announced a set of new rules and regulations effective from 2nd January, 2020 which aims to further increase the ease of doing business for new and existing DMCC member companies.

The new regulations were developed following extensive data gathering and stakeholder engagement along with the consultation of three of the world’s top law firms. The new regulations will update the DMCC’s existing company law framework in line with international best practices to ensure DMCC retains its competitive edge in the region.

The new regulations will enhance ease of operations and provide greater flexibility for the businesses registered within DMCC and increasing the remit of their activities. The new regulations also make it easier to set up a company in the region’s leading trade hub. Key enhancements to the existing framework include:
  • Increased flexibility around a company’s Articles of Association;
  • Introduction of different share types
  • Allowing businesses to tailor the structure of shareholdings
  • Introduction of new dormant status
  • An increased ability to transfer company incorporation into DMCC.
“Ease of doing business is at the heart of DMCC’s offering; we enable all businesses to trade efficiently and with confidence. The new rules and regulations are indicative of our commitment to providing companies with a seamless ability to set up and grow their operations. We are confident that these enhancements will attract even more companies to do business in DMCC,” said Ahmad Hamza, Executive Director Free Zone, DMCC. “With robust infrastructure, state-of-the-art facilities and world-class services, DMCC will continue to attract, facilitate and driving trade flows through the emirate, and strengthen Dubai’s position as one of the world’s leading business capitals,” he added.

DMCC, being a leader in Free Zones around the world, since its inception in 2002, has attracted over 16,000 local and global businesses of all sizes, from start-ups and SMEs to Fortune 500 companies. On average, seven new businesses join the award-winning business district every day.

In recognition of its continuous innovation, DMCC has been awarded Global Free Zone of the Year by the Financial Times’ FDI magazine for five consecutive years.

SHARJAH MEDIA CITY FREE ZONE- AN EMERGING NAME IN THE U.A.E BUSINESS MARKET

Why Sharjah?
Sharjah, the third largest emirate in the UAE, lies partly on the Persian Gulf and partly on the eastern coast of the Gulf of Oman. It is positioned between Asia, Europe and Africa, making it a strategic location with access to markets which total more than 3 billion people. ‘Rising Sun’, as the meaning of its name suggests, is emerging from the shadow of its neighbours Dubai and Abu Dhabi, which is just a short drive away.

Due to Sharjah’s global cultural affiliations, it was awarded with the title of ‘Cultural Emirate of the UAE’ and the ‘Cultural Capital’ of the Arab World in 1998. Along with the social and cultural development, its leadership is now at the forefront of the U.A.E’s economic growth and development by providing world-class Free Zone hubs and facilities for innovation, entrepreneurial, technological and industrial growth under the continued urbanization and modernization drive in Sharjah.

Why Choose Sharjah Media City
Sharjah Media City, commonly referred to as ‘Shams’, was launched in January 2017 with an aim to provide smart and innovative facilities and services along with a vision to make creative entrepreneurship accessible to all aspiring startups and SMEs, as well as for established companies striving to grow their business both locally and globally.

The reason for Shams’ success since its launch is that despite the name, Sharjah Media City offers a diverse range of Business activities along with the Media related activities. With over 250+ business activities to choose from, entrepreneurs, SMEs, Freelance consultants and established companies are already operating in Shams with business profiles ranging from Media production, publishing, Telecommunications, IT consultants and Programmers on one end to wholesale & retail trading, legal & accounting consultancy services and management consultancies at the other.

Shams’ vision to be the first free zone to go digital in executing its processes to cope with the technological advancement in the world make it stand out amongst Free Zones.

More Reasons to Choose Shams
Since its inception, Shams has offered a diverse range of benefits to businesses and entrepreneurs alike. Some of the reasons which make Shams an emerging Free Zone include:

Quick Setup Process:
Shams aims to provide the quickest business setup timelines with License issued on the same day (or Maximum of 3 working days), providing that the documents are complete. We, at Affiniax, aim to provide seamless experience to obtain license and also post-license processes which includes Establishment card issuance, visa issuance and stamping to be completed in minimum time.

Cost Effective Investor Friendly Benefits:

At Shams, business can be setup with sums as low as AED 11,500 (3,130 USD). Additional benefits include:
  • 100% repatriation of capital and profits gain
  • 0% corporate and personal income tax
  • 100% foreign ownership
  • 0% import and export duties (Custom Duties)
  • No Deposits required by Shams
  • Allocation of up to 6 visas on a shared desk facility
  • Ease of selecting multiple activities on same license.
  • Presence of Shareholders are not required to incorporate a company
  • Easy and inexpensive recruitment of workforce
Variety of Office Space Solutions
Whether you are a like-minded freelancer looking for a shared workspace, or a business that requires a private working environment to conduct business activities, at Shams you will be able to find office space solutions to meet your needs and requirements.  It ranges from shared or dedicated desks to shared and dedicated office spaces. Shams also provide solutions for creative units and studios to cater to your business needs.

Ideal Strategic Location
Shams is strategically located and in close proximity to both Sharjah International Airport and Dubai International Airport. It is located within 15 minutes of Sharjah international Airport and within half an hour of Dubai International Airport. The city also provides high class infrastructure facilities along with well-planned urban development.

Flexible Visa Packages
In addition to many other reasons to choose Shams, another advantage of setting up a business in Sharjah Media City is Flexible Visa Options which allows businesses and entrepreneurs to apply for up to 6 visas from a shared desk facility. These visa holders are also eligible to apply for family and dependents visas.

Sharjah media City is aiming to become a leader in providing world class and innovative business opportunities for those wishing to embark on their entrepreneurial journey in the UAE and strive to grow their business both locally and globally. Our expert team at Affiniax, ensures to provide smooth and hassle-free company formation and registration experience. For further enquiries and information please feel free to contact our team of experts at mail@affiniax.com or call us on +971 4 425 6616.

NEW JAFZA OFFSHORE REGULATIONS

New JAFZA Offshore RegulationsThe Jebel Ali Free Zone Authority (JAFZA) recently published new Regulations for Jebel Ali Offshore Companies, which will replace the current regulations that were introduced in 2003. The implementation date for the new Regulations are not implemented yet but it will be announced soon.New regulations with several benefits for international businesses and investors. Some key factors with the new regulations are as below;
  • Residence Visas
Article 31.2, members of an Offshore Company (such as Directors and Shareholders) may apply for a residence visa if the company owns property in any of JAFZA’s freehold areas, and the approval of such application is subject to the Authority’s eligibility requirements.

  • Re-domiciliation of Company
Article 111, Foreign Companies can be re-domiciled as a JAFZA offshore Company, or Offshore Company be transferred to a foreign company.

  • Conversion of Company
Article 118.1, an offshore company can be converted to a Free Zone Company, to be able to conduct business and trade in the UAE.

  • Directorship
Article 33.1 An offshore Company will now only require one Director instead of two. Nominee Director is also allowed.

  • Variation in Rights of Shares
Article 19, an offshore company may subject to the consent of the Registrar, can create different classes of shares, by providing the different classes of shares in its articles of association.

  • Resolution Requirements
A minimum of 75% of shareholders are now required to pass a resolution, increased from the previous requirement of a simple majority.

  • Permitted Activities
According to the New Offshore Regulations, an Offshore Company is also permitted to hold a lease of property for use as its registered office in any of the designated freehold area in the UAE, own a stake in another operating company within the UAE and own property in one of the designated freehold areas. For more information towards offshore company and company Set up with Jebel Ali Free Zone Authority, please feel free to contact our Corporate Services team at mail@affiniax.com.

LIQUIDATIONS IN THE UNITED ARAB EMIRATES (PART 2)

In my previous article, titled, Liquidations in the United Arab Emirates (Part 1), we came across the roles, and duties of a Liquidator, the necessary documents required and the different types of Liquidations in the UAE.

We now take a look at the Procedures for Liquidation.

Mainland Company

In case of a mainland Company the following steps and documents are required for its liquidation:
  • Shareholders resolution confirming the liquidation of the Company. This would usually be in the form of the minutes of the meeting which is held by the shareholders in which they decide on liquidation of the Company and appointment of the liquidators for the same.
  • An acceptance letter from the liquidators accepting their appointment.
  • Application for cancellation of the Company from Department of Economic Development (DED)
  • Receive liquidation certificate from the Department of Economic Development (DED) once the above steps are completed.
  • Once the liquidation certificate is received from the DED, the Company has to publish a notice of liquidation in two local newspapers.
  • After the notice has been published, there is a notice period of 45 days for the debtors to submit their claims (if any).
  • Once the notice period of 45 days is over, the Company must submit the following documents:
    • A declaration stating that all parties have no objection relating to the liquidation of the Company
    • An approval would be required from other government agencies for the cancellation of the Company’s license.
  • The Company must then cancel its firm card with the Ministry of Human Resources and Emiratisation
  • Cancellation of the foreign partner’s visas which are sponsored by the Company.
  • The last step is to pay the DED fee and the company will be successfully liquidated.
Free Zone CompanyIn case of a free zone Company the procedure is slightly different and involves the following steps:
  • Every free zone in the UAE has a portal. The Company intending to liquidate must notify the free zone by applying on the member portal.
  • Once they have notified the respective free zone, they need to submit their application for termination of the Company.
  • After submission of the application, they need to publish the notice in a local newspaper.
  • The free zone will file a final Company termination letter and the Company will be liquidated.
  • Letter to be obtained from the Labor and Immigration department that there are no visas.
Bank Accounts, Employee Contracts, Utilities and Other Services on Liquidation
In all cases, the Company will need to cancel the employees’ visas and their work permits. Dubai portal explains that this requires coordination with both Department of Naturalisation and Residency and Ministry of Human Resources and Emiratisation.

As per the UAE’s Labor Law, employers are required to give their employees a two-month, paid notice period before terminating their contracts. In many cases, employees can keep their residency visas until the company’s trade license runs out. Then, the company needs to cancel utilities and telecommunication services and close all its bank accounts. Collect a NOC from the utilities providing company and bank closure confirmation for processing the closure.

Company liquidation can be a complicated process. However, we can assist you in case you decide to liquidate. Our procedures for preparing the required documents and completing the process shall help you liquidate your Company smoothly.

For more information, Email us at mail@affiniax.com

Dubai International Financial Centre Introduces New Licensing Categories

Dubai International Financial Centre (DIFC) is the leading financial capital in the Middle East, Africa and South Asia (MEASA) region.

As one of Dubai’s independent free-zones, with its own legal and regulatory framework and judicial system, global financial exchange, tax-friendly regime, and a large business community, DIFC is persistent in supporting its businesses to grow by introducing new licensing categories under its operating Laws and Regulations.

The newly introduced categories come with reduced license fees and allow more firms to start conducting business in the DIFC.
  1. Short Term License: Under this category, it is now possible for retail businesses and other non-financial companies to operate from DIFC at a competitive cost, depending on the duration of license required.
  2. Restricted License: This license is applicable to firms interested in developing or testing out new, innovative products and services in the DIFC. These initiatives are encouraged by DIFC as this would allow incubators and startups to flourish within the DIFC environment.
  3. Commercial Permissions License: This license would allow both DIFC and non-DIFC entities such as event companies, promotion companies, retail outlets, seminars and educational services to conduct their business activities within the DIFC for a competitive fee.
  4. Dual Licensing: This license will allow the firms which are under the license of Department of Economic Development (DED) such as law firms, audit consultancy firms, family businesses, holding companies and corporate service providers to operate in the DIFC with an affiliate
To know more, please contact our Corporate Services team at mail@affiniax.com.

LIQUIDATIONS IN THE UNITED ARAB EMIRATES (PART 1)

INTRODUCTION
Liquidation can be defined as the winding up of a Company by selling off its assets to convert them into cash to pay off the firms unsecured creditors. The secured creditors take control of the respective pledged assets on obtaining foreclosure orders. Any remaining amount is distributed among the shareholders in proportion to their shareholdings. It is an event that usually occurs when a company is insolvent, meaning it cannot pay its obligations when they come due.

Types of Liquidations
There are two types of liquidations in the United Arab Emirates.
  • Voluntary Liquidation
In case of voluntary liquidation, the owners or shareholders of the firm decide that to close and wind up the Company as they do not have enough funds to pay off their creditors and other liabilities.
  • Mandatory Liquidation
In case of mandatory liquidation, the liquidation order is put forward by the courts. It is not in the will of an owner or shareholders to liquidate their company. This usually occurs when a company fails to pay creditors multiple times. Because of this, creditors can file a request for the liquidation of a company.Here the assets of the Company are distributed to the creditors and contributors based on the priority of their claims.

Roles and Duties of a Liquidator
A liquidator must be appointed in order to liquidate a Company in the UAE.Below are 7 points which describe the role of a Liquidator.
  • The liquidator appointed by a Company in its liquidation stage shall represent the Company in any litigation that may occur.
  • The assets of the Company are sold by the liquidator in order to settle the debts of the Company.
  • Certain debt is considered as priority and these are settled before other debt. This mainly includes the outstanding employees’ salaries.
  • Once all debt has been settled, the remaining funds are distributed among the shareholders or the owner.
  • In case the funds generated from the sale of the Company’s assets are insufficient to pay off the debts, the deficit will be adjusted against the share capital of the shareholders.
  • The Statement of Affairs and Liquidation Report has to be prepared by the liquidator after conducting the necessary procedures.
  • The liquidator would also be responsible to request for the removal of the Company from the Commercial Register.
Documents required for Liquidation of a Company in the UAE
  • Copy of the license
  • Memorandum of Association
  • Shareholder’s Resolution to liquidate the Company
  • Power of Attorney
  • Passport copies of all shareholders along with Emirates ID’s
  • Application for deregistration
  • Statement of Affairs and Liquidation Report
  • Letter from Labour and Immigration department that there are no visas.
For more information, Email us at mail@affiniax.com

UAE FOREIGN INVESTMENT LAW CHANGE

The UAE Government has now enacted Federal Decree-Law No. 19 of 2018 (“FDI Law”) in furtherance of its objective to allow increased foreign shareholder participation in UAE mainland registered companies beyond the current restriction of 49%. To date, foreign investors wanting to own UAE businesses wholly, or to have a majority stake, have been limited to registering their companies in UAE freezones or by limiting their operations to a branch/representative office. Free-zone registered companies and branch/representative offices have limitations to their trading and investment activities in the UAE. Previously foreign investors have often found structuring business for commercial activities in the UAE challenging.

The FDI Law does not represent a wholesale change to business investment in the UAE and, to avoid doubt, it does not allow 100% foreign ownership across all sectors of the economy. Rather, the FDI Law introduces a framework under which the UAE Government (acting through a newly formed FDI Unit and FDI Committee in addition to the existing licensing departments of the Department of Economic Development), may designate certain sectors of the economy as being available to more than 49% foreign ownership. These are deemed to be “priority” economic sectors and are in furtherance of Federal Decree-Law No. 18 of 2017 (an amendment to the UAE Commercial Companies Law) which gave scope to the UAE Cabinet to authorise foreign investors to have an increased shareholding in companies within certain sectors.

FDI Unit and FDI Committee

The FDI Law provides, in summary, for the establishment of:

  •  by decision of the Ministry of Economy, an FDI Unit, which shall, amongst various responsibilities, be charged with: (i) proposing FDI policies, priorities and programmes; (ii) building a base of investment data and information; (iii) consolidating and facilitating registration/licensing procedures for FDI projects;(iv) promoting/advertising the FDI environment; (v) preparing periodical reports on the FDI environment in the UAE; and (vi) attracting FDI to vital/strategic sectors; and
  • by decision of the UAE Cabinet, a FDI Committee, charged with studying and recommending to the UAE Cabinet, amongst others things: (i) a list of economic sectors that may benefit from additional levels of foreign ownership (“Positive List”); and (ii) adding to the list of sectors that shall not be open to additional levels of foreign ownership (“Negative List”).

Positive List

  • The FDI Law does not explicitly define the economic sectors or business activities in which foreign ownership beyond the current 49% limitation may be permitted. Rather, it provides that a Positive List will be developed by the FDI Committee, based on certain key criteria including:
  • Strategic plans in the UAE
  • A return on investment for the UAE economy
  • The business’ approach to UAE innovation
  • Emirate national’s job and training opportunities
  • The impact on other Emirati owned businesses
  • The reputation and competence of the foreign investor
  • The investment into and the use of modern technology
  • Positive impact on the environment

The permission of foreign ownership is therefore based on discretion by the FDI and the award of the business licences will occur on a case by case basis. The FDI Law also provides that the conditions of investment will prescribe:

  • The legal form of entity which may be established
  • The percentage of capital capable of being owned, hence there may be a requirement for some Emirati national ownership of a minority investment;
  • the minimum capital to be invested (with any conditions or controls attaching to this investment); and
  • a prescribed Emirati workforce/employees to be engaged by the company.

Negative List

The FDI Law sets out a number of sectors/activities in the Negative List, which the FDI Committee shall be able to add to. Currently, the Negative List includes:

  • Exploration and production of petroleum products
  • Hajj and Umrah services (including labour supply and recruitment)
  • Insurance services
  • Banking & finance activities and payment/cash handling systems
  • Postal, communication and audio-visual services
  • Water and electricity services
  • Land and air transport services
  • Commercial agents services
  • Retail medicine (private pharmacies)

Other Welcome Measures

The FDI Law also provides assurances that profits generated in the UAE from any FDI investment, the proceeds from a liquidation of the investment and funds collected from the settlement of any dispute can be transferred out of the UAE, subject always to existing legislation. This would appear to give comfort and assurance to foreign investors that the UAE’s longstanding friendly investment culture will continue to apply.

Please contact Affiniax Partners for any advice with respect to registering a business with the new FDI entitlements.