The investor has two options when registering a business in RAK. The investor can either opt to invest in a Free Zone area or in a Non-Free Zone area. If the investor chooses to invest in a non-Free Zone area, than the registration of the business is done through the local Chamber of Commerce and Industry, the Economic Development Department and the Ministry of Finance.

Free Zone

There are two Free Zones available in RAK:

RAK Free Trade Zone

Since its inception in May 2000, RAK Free Trade Zone (RAKFTZ) has been growing rapidly. RAKFTZ continues to spread in the industrial horizon with more and more companies willing to set up shop in the investor friendly environment.

RAKFTZ holds the following advantages for the prospective investors:

RAK Free Trade Zone is striving to provide lucrative business opportunities to world's most dynamic companies. RAKFTZ is unique for the fact that it has three different business parks specializing in various sectors. The diversification of the Free Zone parks, both functionally and geographically, offers numerous advantages to the investors as they can choose their location based on the type of business activity. Each of the three parks, Business Park, Industrial Park and Technology Park, offers identical advantages and benefits to investors.

For further details, please visit the RAKFTZ website:
www.rakftz.com

RAKIA Free Zone

The RAK Investment Authority Free Zone is located close to the RAK Ceramics factory and is adjacent to the RAK FTZ Technology Park. Comprising an area of 2.1 million square metres, the RAK Investment Authority Free Zone offers land for investors who wish to avail themselves of Free Zone benefits and those who wish to set up Limited Liability Companies with local partners.

Registering a business in a non-Free Zone Area

The UAE Federal law concerning commercial companies, states that any company operating in UAE outside the Free Zone areas, should either be totally owned by nationals or must have at least 51 per cent shareholding in joint or foreign ventures. The remaining 49 per cent may be owned by foreigners. Foreign companies or individuals who wish to set-up their business in UAE must at least have a sponsor or service agent and obtain a legal trade license from the local Chamber of Commerce and Industry, the Economic Development Department and with the Ministry of Finance.

Forms of Commercial Companies

1. Partnership :

This type of company is composed of two or more partners who are jointly responsible for the liabilities of the company. This form of company is confined only to UAE nationals, because foreigner's properties would be outside the boundaries of UAE.

2. Partnership in Commendams:

It is an establishment comprising of one or more joint partners whose responsibility for the liabilities include their property. This form of company partnership includes another partner whose capital share participation covers his/her responsibility toward liabilities. This type of company is confined to UAE nationals only, due to the sort and extent of financial commitments involved.

3. Limited liability company (L.L.C.):

The number of partners in a limited liability company should at least be two but must not exceed fifty. The minimum total capital investment is Dh. 150,000. The partner's financial responsibility does not go beyond his/her shares in the capital of the company. The total capital shares of a non-UAE partner in any limited liability company should not exceed 49% of the total capital of the company.

4. Joint venture (consortium) company:

This type of Company is not inscribed in the commercial register or formally declared. It may consist of two or more partners that share losses and profits. This sort of company is a clandestine company, based on the relationship between one partner who holds the license and an investor in view of executing a specific project. Usually no special license is issued to the company, yet it operates based on a proper agreement, legally binding to the concerned parties.

5. Public shareholding company (P.S.C.):

The capital of a public shareholding company must be divided into equal negotiable shares. The responsibility of shareholders towards the liabilities of the company are limited to the extend of the value of shares they hold. The least number of shareholders to establish such a company is ten. The company should have memorandum associations prior to the subscription of shareholders. A Board of Directors should be elected by the general assembly and the company should be formally registered at the ministry of Economy and Commerce.

6. Private shareholding company:

The least number of shareholders to start such a company is three. The share capital must be subscribed in full. With the exception of the above condition, all provisions of a public shareholding company are applicable.

7. Partnership limited by shares:

It is a company formed by partners who are jointly and severally responsible for all liabilities of the company. The company also consists of partner shareholders whose financial responsibility towards the company's liabilities is limited to the extent of their value of shares. All conditions that govern public shareholding companies, are also binding to partnership limited by shares. The company's deed of incorporation, must be signed by all partners.

For further details, please visit the following website:
www.rakchamber.com