Ras Al Khaimah (RAK) is an increasingly popular choice for business setup in the UAE. Its mainland jurisdiction provides a strategic advantage for entrepreneurs, offering the freedom to operate and conduct business anywhere in the UAE. This access, combined with a business-friendly environment, makes RAK a prime location for company registration.
A business in Ras Al Khaimah Mainland comes with numerous benefits that appeal to both local and foreign investors:
- 100% Foreign Ownership: In line with recent UAE law changes, many business activities in RAK now permit 100% foreign ownership, eliminating the need for a local sponsor for many business types.
- Tax Benefits: Mainland companies in RAK are exempt from corporate and personal income tax.
- Freedom of Operation: You can operate your company from anywhere in the UAE, allowing you to easily target the entire local market.
- No Capital Requirement: There is often no minimum share capital required for a local mainland license.
- Repatriation of Profits: Enjoy 100% repatriation of capital and profits, giving you full control over your finances.
- Streamlined Processes: The registration process is designed to be simple and efficient, with easy processing of employment visas and no mandatory annual audit.
Types of Business Structures in RAK
The Ras Al Khaimah Department of Economic Development (DED) governs the registration and licensing of mainland companies. The most common legal structures include:
- Limited Liability Company (LLC): This is the most popular choice for businesses engaged in commercial and professional activities.
- Branch Office: An extension of a foreign parent company, allowing it to operate in the RAK market.
- Professional Firm: For professionals and consultants, this structure provides a direct path to setting up a business.
- Public Shareholding Company: A legal structure for larger businesses with multiple shareholders.
The Business Setup Process
While the process is straightforward, working with a business setup specialist can ensure a seamless experience. Here’s a general overview of the steps involved in RAK Mainland company formation:
- Define Your Business: Determine your business activity and the legal structure that best fits your goals.
- Trade Name Registration: Submit your proposed company name to the DED for approval. The name should be unique and adhere to UAE naming conventions.
- Initial Approval: Obtain an initial approval from the DED, which confirms that the authorities have no objection to your business plan.
- Draft Legal Agreements: Prepare and notarize the Memorandum of Association (MOA) or a Local Service Agent (LSA) agreement.
- Secure Your Location: Find a physical office space and have the lease agreement signed.
- Obtain Necessary Approvals: Depending on your business activity, you may need additional approvals from other government authorities.
- Submit Documents and Pay Fees: Once all documents are in order, submit them to the DED and pay the license fees.
- Receive Your License: Your official trade license will be issued, allowing you to begin operations legally.
Advantages and Disadvantages
Advantages:
- Strategic Location: RAK’s location, near key transport hubs, offers excellent connectivity to the Middle East and beyond.
- No Corporate Tax: Enjoy a 100% corporate tax exemption.
- Full Ownership: Many activities are open for 100% foreign ownership, giving investors complete control.
Disadvantages:
- Local Partner Requirement: For certain business activities (though a diminishing list), a local partner may still be required to hold at least 51% of the shares in an LLC.
- Physical Office: A physical office space is mandatory for all mainland businesses.