Company Registration in Sharjah
One of the United Arab Emirates’ seven emirates is Sharjah (UAE). It is not difficult to register a company in Sharjah, but it is crucial to follow the local law of the UAE when doing so. The tax incentives and advantages of registering a corporation in Sharjah are numerous. It is advantageous for investors to conduct business in Sharjah because there are certain free trade zones available.
- Procedure for Company Registration in Sharjah
- Documentation for Company Registration in Sharjah
- Liaising with the concerned regulatory authorities for company registration in Sharjah
- End to End Support
Company Registration in Sharjah- An Overview
After Dubai and Abu Dhabi, Sharjah is regarded as one of the emirates with the highest population. The Dubai-Sharjah-Ajman metropolitan area includes this emirate. Between Dubai, Ajman, Umm Al Quwain, and Ras Al Khaimah is Sharjah. Consequently it makes it an ideal site for investors to go for company registration in Sharjah. The Persian Gulf is accessible from this emirate.
Due to Sharjah’s affiliation with the UAE, neither businesses nor people are subject to any kind of capital gains tax or withholding tax. Different import and export kinds are not subject to taxes. Thus, it would be a wonderful place to launch a business.
A Sharjah-incorporated firm must have at least 51% of its shares owned by local Emirati citizens. Nonetheless, the corporation would be the sole one to choose the profit sharing ratio. This gives the client the freedom to launch a business in Sharjah.
Sharjah is renowned as an industrial hub that draws many global manufacturers. Sharjah is where more than 80% of manufacturing takes place. Setting up a manufacturing or production business in Sharjah would therefore be excellent. Sharjah is regarded as one of the top ten business-friendly cities in the United Arab Emirates. Investors can effortlessly incorporate a business here. In Sharjah, there are various types of free trade zones that let a company to have 100% foreign ownership. In addition to this, Sharjah free trade zones offer a variety of benefits for business incorporation. These free trade zones include Hamriyah Free Trade Zone and Sharjah Airport International Free Zone.
The low cost of manufacturing facilities in Sharjah is a result of the abundance of resources, including water and energy. Hence, manufacturing organisations can use the aforementioned resources to provide the product they need.
An investor may find it appealing to proceed with the Sharjah company registration process due to all the perks listed above.
Benefits of Company Registration in Sharjah
- Exceptional Infrastructure
The third most populous city in the UAE after Dubai and Abu Dhabi is Sharjah, which is a part of the United Arab Emirates. This well-known area may be found close to Dubai. Due to the government’s extensive support for businesses, incorporation is fairly simple here. Either Sharjah non-free trade zones or Sharjah free trade zones are available for incorporation by investors. The government might offer greater perks and incentives if they register a business in the Sharjah free trade zones.
- Existence of Resources
In Sharjah, manufacturing facilities are inexpensive due to the city’s abundance of resources including water and energy. Hence, manufacturing organisations can use the aforementioned resources to provide the product they need. More than 60% of the costs associated with the resources utilised in routine industrial activities are borne by the government.
- Zones of Free Trade
In Sharjah, there are several free trade zones, including the Hamriyah Free Trade Zone and the Sharjah Airport International Free Zone. A free trade zone would permit 100 percent foreign ownership of a company. Together with this, the government also provides a variety of advantages and incentives.
- enormous cargo hub
Sharjah is one of the world’s biggest freight hubs since it is located in the middle of four emirates. This is because the Sharjah International Free Trade Zone is present.
Eligible Business Structures for Company Registration in Sharjah
The business structures listed below can be used to register a company in Sharjah:
- Businesses with Limited Liability (LLC)
One of the most popular business structures used for Sharjah company formation is this one. In this type of business, the partners’ liability is constrained. An LLC established in Sharjah must have a minimum of two participants in order to comply with the Second Federal Company Law. The maximum number of partners, however, cannot exceed 50. An LLC in Sharjah may have foreign residents as managers. The minimum investment required to form a limited liability company in Sharjah is AED 150,000.
- Division Office
Sharjah’s branch office is only an outgrowth of the international parent firm. Either a Sharjah Free Trade Zone or a Non-Sharjah Free Trade Zone may be chosen as the location for the branch office. Foreign ownership would be subject to limitations, nevertheless, if the business was established outside of the Sharjah Free Trade Zone.
- Joint Stock Businesses
Sharjah allows for the registration of joint stock companies. Similar to a public corporation that lists its shares on a public limited stock exchange is a joint stock company.
- Sharjah Free Trade Zone Corporation
In Sharjah, there are numerous free trade zones. In the Sharjah Free Trade Zone, a branch office of a foreign company may be established. The corporation can be incorporated here for a variety of reasons. The business may have just foreign ownership.
Minimum Eligibility Criteria for Company Registration in Sharjah
The following eligibility requirements must be met in order to register a business in Sharjah:
If a firm is established in a non-free trade zone, the required ownership percentage for a Sharjah company registration applicant is merely 49%. A native Emirati citizen must be chosen by the company to hold a 51% ownership stake. Consequently no foreign ownership is allowed for this sort of entity. …… and……………
The minimum capital required for company registration in Sharjah is vary for every company. The minimum amount of capital needed to form an LLC is AED 150,000.
- Visiting Directors
A foreign management or director may be appointed by an LLC. The applicant must confirm that the directors meet Sharjah’s requirements for corporate registration. The acquisition of suitable visas for the foreign directors would be one such need.
Procedure for Company Registration in Sharjah
The following procedure is required for company registration in Sharjah:
- Kind of Business
An applicant must first choose the kind of business that qualifies for Sharjah company registration. The Sharjah free zone company would be the best business structure if the applicant wanted a corporation in Sharjah with 100% foreign ownership. Nonetheless, a limited liability company would be the best option in Sharjah if the applicant wants some level of independence and oversight by international managers.
- local benefactor
According to UAE law, a foreign business must locate a local sponsor. A majority shareholder in the business is required for the local sponsor. Hence, the local sponsor would have to control more than 51% of the company. Up to 49% of the company’s shares must be owned by the foreign corporation. Nonetheless, choosing a free zone business would be appropriate if the applicant for company registration in Sharjah seeks 100% foreign ownership.
- the Department of Economic Development should be notified.
The applicant would need to register with the Department of Economic Development following the selection of a suitable structure and the identification of a local sponsor (DED). Apart from this, the applicant can access to the website of the Sharjah Chambers of Commerce for the process of company registration.
- submission for a relevant licence
The applicant would submit an application for the relevant licence after registering the business. Trade licences, industrial licences, and professional licences are the three categories of licences that can be requested.
- Registration of Trade Names
The applicant would need to register the trade name after obtaining the trading licence. The corporate name would be the trade name. The public must not know about another name like that. The name you choose must not violate someone else’s intellectual property. The name ought to stand out from all other names.
- municipal endorsement
The applicant would next need to obtain municipal approval in the following phase.
- Memorandum of Association drafting
The memorandum of association would need to be written by the applicant. Here, the applicant would need to offer accurate information about the business. The memorandum must be notarized in front of the appropriate notary after it has been written.
- Lease Contract
Beginning in 2019, the Sharjah government will mandate that businesses employ locals and have actual offices there. If the applicant needs office space in Sharjah, office space security must be done. The leasing agreement needs to be notarized after everything is concluded.
- Make a licence fee payment.
The appropriate licence fee must be paid by the applicant. Once this is done, the company needs to obtain the name board’s blessing. This marks the end of the Sharjah company registration process.
Compliances required for company registration in Sharjah
The following compliances have to be carried out for company registration in Sharjah:
There is no corporate tax in Sharjah. Even personal income tax is not levied on earnings made in Sharjah. Since 2018, a 5% Value Added Tax (VAT) has been imposed. The Sharjah subsidiary would not be subject to withholding tax if dividends were paid. This would only be the case, though, if the overseas parent firm received the dividend payments.
- Annual Meeting of the Whole
Under Articles 92 and 171 of the UAE Commercial Companies Law of 2015, all UAE firms are required to have an Annual General Meeting (AGM) within four months of the end of the fiscal year.
- sanctions for failing to have an AGM
A punishment of AED50,000 to AED100,000 is imposed on the firm if an Annual General Meeting is not held as required by law.
- Board sessions
If the memorandum of association contains such a clause, the board must meet at least once a year.
In Sharjah, the following papers are necessary for company registration:
- application for registering a business
- a copy of the contact’s business card
- Business plan sample
- attested and notarized Articles of Association (MOA)
- Articles of Association with Notarization and Attestation (AOA)
- copies of the partners’ and managers’ passports
- Authentic bank reference letters and, if required, a licence for the partner’s current business
- lease contract
- Bank Positions taken by the parent company (Last three months)
- Authority of Attorney (For representative)
- Resolution of the Board of the Foreign Parent Company
- Feasibility report of the project which is going to be carried out.
How to reach Enterslice for Company Registration in Sharjah
Frequently Asked Questions
Does Sharjah belong to the UAE?
Sharjah does really belong to the UAE. The United Arab Emirates, or UAE, is made up of seven emirates.
Would there be any limitations on who may own what?
An investor is only permitted to possess 49% of a firm that is incorporated in Sharjah. A national of the UAE would control the remaining 51% of the stake.
If I establish a business in one of Sharjah’s free trade zones, will the restrictions still apply?
No, a Sharjah-incorporated firm may not have 100% foreign ownership.
What kinds of licences are available in Sharjah?
Trade licences, industrial licences, and professional licences are the three categories of licences that can be requested.
What kinds of businesses are permitted to be incorporated in Sharjah?
The following sorts of corporations can be incorporated by a person applying for company registration in Sharjah.
Sharjah Free Trade Zone Corporation Limited Liability Companies (LLC) Branch Office Joint Stock Companies.