Motei & Associates | | Jebel Ali Offshore

Incorporation of an offshore company (or non-resident company) can be used to mitigate taxes. Residents of countries with high tax rates may be able to reduce the tax they pay by arranging for profits to be attributed to a company incorporated in a territory, which does not tax the income earned outside of the territory.

Over the years, Dubai has consistently followed policies directed towards instilling market confidence and enhancing the economy by the encouragement of local and foreign investors.

To that end, on January 13, 2003 the Jebel Ali Free Zone Offshore Companies Regulations 2003 (the “Offshore Regulations”) was enacted allowing the incorporation of offshore entities in the Jebel Ali Free Zone (“JAFZ”). Such companies enjoy all advantages of other international offshore companies, in addition to the added benefit of Dubai’s reputation for business transparency and sustainable development.

The Jebel Ali Offshore may not seem the obvious choice of jurisdiction, but a closer examination of the features that Jebel Ali Offshore and Dubai have to offer makes this venue an attractive option.

Jebel Ali Offshore Company Features:

100% Foreign Ownership
Companies are not subject to any taxes or duties in UAE.
Easy procedures for transfer of shares.
Company can own/lease real estate properties on Palm islands, or any properties owned by Nakheel Company LLC or any other real estate properties approved by the JAFZ - Authority.
Company can hold an account in a bank within and/or outside the UAE for the purpose of conducting routine operational transactions.
One residence visa will be issued for one director - if the Offshore Company maintains an office in the JAFZ Offshore companies are permitted to lease office space in Dubai.
Legalization of documents is less costly and less cumbersome than other jurisdiction.

Shareholders	A minimum of one shareholder is required. Corporate shareholders are permitted. Shareholders' meetings should be held periodically (at least once in a year). Every company shall maintain minutes of all proceedings at general meetings.
Share Capital	There is no minimum capital amount required. All shares rank equally and must be fully paid when allotted. Share Certificates must be issued within two months from the date of payment of the capital. Bearer shares or different classes of shares are not allowed.
Directors	A minimum of two directors are required and corporate directors are not permitted. The number of directors can be fixed in the Memorandum and Articles of Association. Details of directors are not available for public inspection. The first directors are appointed by the incorporators at the time of incorporation, and thereafter elected by the shareholders. Any shareholder may be appointed as a director and/or a secretary. Each director holds office for a period determined by the shareholders. In the event of death or resignation, another director may be appointed by the resolution of the shareholders. A vacancy created by removal of a director may be filled by resolution or in absence of such resolution by the remaining directors.
Secretary	Every company is required to have a secretary, which is appointed by the shareholders for such period as the shareholders may determine. A shareholder may be appointed as a secretary and/or a director.
Annual Account and Audits	Every company shall keep accounting records. Accounts shall be preserved for 10 years from the date on which they are prepared. Accounts must be approved by the directors and signed by one of them. Every company must appoint an Auditor (from the approved list), who shall examine and report on the accounts in accordance with the regulations.
Company Register	All offshore companies are required to maintain the following registers: (1) Register of Shareholders; (2) Register of Directors and Secretary; (3) Register of Meetings (shareholders, directors, committees). Registers shall be open for inspection by any shareholder or director of the offshore company and/or the Registrar. If inspection is refused, the company commits an offence.
Inspection	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.
Incorporation Time Frame	Five (5) working days from the time all the required documents are submitted to the JAFZ.
Restrictions on Name	Names must end with “limited”.
Activities/Restrictions on Activity	Offshore Companies may engage in any lawful activity for which offshore companies may be organized under to the JAFZ Companies Regulations. Offshore companies are prohibited from carrying on business with person(s) resident in the UAE. However, an Offshore Company shall not be treated as carrying on business with person(s) residing in the UAE by reason only that it: (a) makes or maintains professional contacts with legal consultants, accountants and management companies; (b) prepares and maintains books and records; (c) holds its General Meetings or meetings for its directors; (d) leases office space for its use as a registered office; or (e) holds a bank account for the purpose of conducting its routing transactions. In the event that an Offshore Company desires to carry out business either within the JAFZ or elsewhere in the UAE, the proper license should be obtained from the competent authority.
Registered Agent	The company is required to appoint an approved registered agent from the list of approved JAFZ Registered Agent List (Motei & Associates is an approved JAFZ Registered Agent)