How to set up an offshore company in RAKICC
What is an offshore company in the UAE?
An Offshore Company is defined as a legal business entity that operates outside its registered jurisdiction and place of ownership. Unlike an onshore company, which exists and operates within the borders of the country it is registered.
It is a tax efficient, cost effective means for companies to carry out business globally.
There are three jurisdictions in which an offshore company can be established in the UAE: In Ras Al Khaimah (RAK), Jebel Ali Free zone (JAFZA) and Ajman.
All three offer 100% foreign ownership, exemption from income tax and corporate tax and no requirement for investment of share capital.
JAFZA is the most expensive of the three in terms of setup costs and subsequent annual fees. However, it is the only one of the three which allows for real estate ownership in Dubai.
RAK and Ajman are more cost-effective options and unlike JAFZA, have no restrictions on permitted activities.
RAK ICC is located 45 minutes’ drive from central Dubai and is a European Union Economic and Financial Affairs Council (ECOFIN) whitelisted offshore jurisdiction with ability to meet Economic Substance Regulations (ESR). RAK ICC jurisdiction has zero tax on Corporate Income, Capital Gains, Dividends, and Interest Income. It provides access to Common Law legislation through access to the common law courts in Abu Dhabi Global Markets (ADGM) and Dubai International Finance Centre (DIFC).
The registration process in RAK ICC is fast, and relatively cost-effective. RAC ICC also allows re-domiciliation, migration & continuation from various other offshore jurisdictions. There is no minimum capital requirement to set up in RAK ICC.
Benefits of offshore companies
Establishing an offshore company in the UAE can be advantageous for many reasons. some of the key benefits include:
- 100% foreign ownership. There is no requirement in the RAK international company regulations for any local shareholding in the company.
- Privacy. There is no requirement to provide the names of company directors or shareholders on a public register.
- Swift incorporation process. RAKICC company registration will usually be complete one week after submission of all required documentation.
- Share capital. There is no minimum share capital requirement for incorporation.
- International growth. An offshore company can act as a base to exploit international market opportunities.
- Better access to global funding
- Offering a means to separate or protect assets from other operating entities
Why set up a company in Ras Al Khaimah International Corporate Centre (RAKICC)?
Ras Al Khaimah is one of the seven emirates that form the federation of the United Arab Emirates (UAE). The capital, Abu Dhabi is easily accessible by road in approximately 2 hours, with Dubai just an hour away.
RAK ICC offers a very business-friendly environment, with operating costs significantly lower than the UAE average, allowing businesses to maximise their ROI.
The main benefits that RAKICC offers to investors are:
With a mainland UAE company, a foreign investor is only permitted to hold a 49% share in their business with the remaining 51% allocated to an Emirati sponsor/partner.
A company in RAKICC has no such restrictions. The foreign investor has full ownership of the business. This provides investors with the reassurance that they will retain full control over their business operations and negates the possibility of any future ownership disputes.
To incorporate a mainland company, there is a requirement for a minimum level of capital, which must be considered sufficient by the UAE government to achieve the purposes of its incorporation. This varies depending on the type of entity, but for reference purposes, a minimum share capital of AED100,00 would generally be accepted by a notary public for an LLC in Dubai. In RAKICC, however, there is no minimum share capital requirement and no requirement to file financial accounts.
This removes a lot of the stress associated with opening local bank accounts and attestation of corporate documents.
RAK has an independent legal system that is distinct from the federal system and from the authority of the Federal Supreme Court. It is based on the Common Law system and allows access to the common law courts of the Abu Dhabi Global Markets (ADGM) and the Dubai International Finance Centre (DIFC).
These are English language judiciaries with authority to resolve commercial disputes as well as local or international corporate cases.
This simplifies the resolution of any disputes and gives clients peace of mind that their company complies with all local and international laws.
- Cost efficiency
Firstly, setup costs in RAK are generally much lower than in the rest of the UAE and there is no need to add the expense of renting office space since all companies in RAKICC have a registered office.
Secondly, the UAE has one of the largest tax treaty networks in the world. This means that businesses setting up in the UAE can avoid the issue of double taxation on the same income and can often get relief from various other tax compliance obligations in other countries.
What are the steps for setting up an offshore company in RAKICC?
There are three steps for company incorporation in RAKICC. They are:
- Select your company name and the activities that the company will carry out.
- Prepare the relevant following documents.
- Submit your application to RAKICC for the company to be incorporated
The process will generally take 5-7 working days if all the documents are in place.
When you have confirmation from RAKICC, you can open a business bank account here in the UAE.
For more details on the types of company that can be set up in RAK ICC and
How can PRO Partner Group help?
At PRO Partner Group we have built enduring relationships with key government bodies and we have direct access to government departments, regulatory authorities and freezone authorities with our on-the-ground team of experts in each department.
We will streamline the process of business setup in RAK ICC and provide ongoing support and administration. We always ensure that every step is taken to accelerate the application and deliver outstanding results both in the company formation stage and the ongoing maintenance of the licence.
If you need assistance with setting up in RAK ICC or any other related onshore or offshore company setup, restructuring, local partner or PRO support matter in Abu Dhabi, Dubai, the wider UAE, Oman, Qatar or KSA, then please do get in touch with us on +971 (0)4 456 1761 for Dubai or +971 (0)2 448 5120 for Abu Dhabi, email us at firstname.lastname@example.org or complete the contact form below and we will be delighted to assist you.