An investor intends to do business outside the UAE or to buy freehold property in Dubai should opt for offshore company registration in Dubai. Currently, the only free zone, Jafza (formally known as Jebel Ali Free Zone Authority) is offering offshore company formation in Dubai.
Jebel Ali Free Zone is one of the leading free zones in the UAE. Based in the far western end of Dubai in an area called Jebel Ali. Consist of more than 7500 companies, Jafza is the most prestigious and dynamic free zone in UAE.
UAE has signed Double Tax Avoidance Agreements (DTAA) with more than 100 countries, 115 to be precise; JAFZA offshore can be used to register an offshore company and to do business with those countries to avail the benefits of DTAA. Just like any other offshore company, say BVI offshore, Panama offshore and Mauritius offshore JAFZA offshore company can be used as a holding and investment entity as well. JAFZA offshore commands better image due to high standards and strict regulations by Jebel Ali Free Zone Authority.
Jafza Offshore Company Formation
One of the latest initiatives by the Dubai government has been the setting up of offshore companies, which will be covered under Jebel Ali Free Zone Offshore Companies Regulations 2003 with effect from January 15, 2003. The regulations are made by the Chairman of the Dubai Port, Customs and Free Zone Corporation in accordance with the authority given to him by Dubai laws Numbers 1 and 4 of 2001.
The first fact about the Jebel Ali offshore (which is popularly known as the JAFZA offshore) is that it is covered under Jebel Ali Free Zone Offshore Companies Regulations of 2003 owing to which the companies incorporated on the JAFZA offshore cannot serve the clients within the UAE. In addition to this, JAFZA offshore cannot issue visas.
Other choices when it comes to form an offshore company in the UAE are the Ras Al Khaimah offshore (Rak Offshore) or popularly known as RAKICC and Ajman offshore. The activities that are allowed by the Jafza offshore are investment or holding activity, trading activity, etc. Consultancy activates are not allowed to be carried out by Jafza offshore.
As per recently enhanced compliance with federal law no (20) of 2018, all Jafza offshore companies are required to maintain the books of accounts with their registered agents. In addition to this, at least one shareholder, two directors, and one secretary are offshore in a JAFZA offshore company.
Salient Features of Forming an Offshore Company in Jafza, Dubai
- 100% foreign ownership
- The company can own real estate properties on Palm islands or any properties owned by Emmar Nakheel Company LLC, Dubai Holdings or any other real estate properties approved by the Jebel Ali Free Zone Authority (JAFZA)
- The company can hold an account in a bank in the UAE for the purpose of conducting routine operational transactions.
- The Company will not be allowed to carry on business with people who are resident in the UAE or carry out any trade in the free zone or in the UAE unless they have first obtained the appropriate license from the relevant competent authority.
- The registrar has the power to appoint competent inspectors to investigate the affairs of the offshore Company. Upon discretion of the registrar, inspection costs may be charged to any office bearer of the Company.
Characteristics of an Offshore Company Registered in the Jafza, Dubai
|A minimum of one shareholder is required. Corporate shareholders are permitted. Shareholders will decide the capital structure of the Company. No fiscal minimum capital requirements have been stipulated. Bearer shares are not permitted. Different classes of shares are not permitted and shares have to be fully paid when allotted. A shareholders meeting should be conducted periodically (at least once in a year). Every company shall maintain minutes of all proceedings at general meetings. The Register of Members shall be open for inspection by any member of the offshore company and any other person. If the inspection is refused, the company commits an offence.|
|A minimum of two directors are required and corporate directors are not permitted. Details of Directors are not available for public inspection.|
|Every Company shall have a secretary.|
Annual Accounts & Audit
|Every Company shall keep accounting records. Accounts shall be preserved for 10 years from the date on which they are prepared. An offshore company’s accounts shall be approved by the directors and signed by one of them. An offshore company will appoint an Auditor (from the approved list) for the annual audit, who shall examine and report in accordance with these regulations upon the accounts prepared.|
|Registration of the company in the free zone will take approximately 3 working days. However, for certain nationalities like Iran, Russia, Afghan, Iraq, Kazakhstan etc. a minimum of 7 working days required.|
Restrictions on Name & Activity
|Names must end with limited. Certain business sectors such as banking, insurance, reinsurance, insurance agency or insurance brokerages etc. are closed for offshore companies.|
|As a matter of local company law, the company must maintain a registered office in the Free Zone and appoint an approved registered agent. A registered agent’s office in Dubai or in the free zone can also be used as the registered office.|
Offshore Company in Jebel Ali Free Zone - Procedure & Licensing Requirements
Documents/ Information required for company incorporation (Individual Applicant):
- Document showing the appointment of agent. (Will be provided by us)
- Application form. (Will be provided by us)
- Applicant personal profile (Short/brief resume/CV)
- Certified Passport copy with UAE entry stamped page.
- Original Bank reference letter (Certified by the Banker)
- Proof of residence by the shareholder (Not later than 3 months-These can be in the form of different utility bills (gas/electricity/water/mobile phone bills), different bank statements or a combination of the two.
- Power of Attorney (Notarized & Attested) if POA holder represents the applicant.
- Few trade names.
- Details of Directors/Shareholders with individual addresses and percentage of shareholding of each shareholder
Note: Personal presence of all the shareholders/POA holders/Legal Representative is required before JAFZA Authorities at time of incorporation.
Documents/ Information required for company incorporation (Corporate Applicant):
- Business Plan
- Application form for offshore company formation (we will provide to you)*
- Document Showing appointment of Registered Agent.
- Original Bank reference letter of the company.
- Copy of Certificate of Incorporation of the parent company, notarized and attested by the UAE Embassy in the country of Origin.
- Copy of Memorandum & Article of Association of the parent company, notarized and attested by the UAE Embassy in the country of Origin.
- Power of Attorney in favour of Manager notarized and attested by the UAE Embassy in the country of Origin.
- Board resolution to form a subsidiary in Dubai, UAE, notarized & attested by UAE Embassy in the country of Origin.
- Certificate of good standing of the company notarized & attested by the UAE Embassy in the country of Origin.
- Passport copies, original bank reference letter, Residence proof, CV/profile/resume of the shareholders/directors of the parent company.
- Original Bank reference letter of the Authorized representative of the parent company.
- Proof of residence of the Authorized representative of the parent company (Not later than 3 months-These can be in the form of different utility bills (gas/electricity/water /mobile phone bills).
Registered Agents in Jafza Offshore
Jitendra Business Consultants (JBC) are registered agents with Jafza Offshore authority. We have helped hundreds of individuals and companies to setup an offshore company in Jebel Ali Free Zone. Registered agents are helpful in choosing the right jurisdictions, they analyze your business plans, identify the needs and requirement and provide you with the best solution suiting your business goals.
To facilitate more and encourage businessmen, the free zones authorities make continues changes in rules and regulations for offshore company formation that produce effective results for the business community. Registered and regulated agents are well aware of the changes and amendments, enabling them to provide you with a smooth and quick business setup solution as an offshore company.
Business setup consultants in Dubai, UAE are also helpful in opening a bank account & getting the visa issued. Apart from offering services for offshore company setup in UAE, JBC also provide accounting & auditing services in Jafza offshore as registered auditors in Jafza & across UAE.