UAE has witnessed an economic diversification in the past few decades, owing to the excitement of global investors toward the country. A business-friendly environment coupled with the tax benefits, made it a perfect choice for investment. One of the most popular forms of starting a venture in UAE is setting up a general trade company. In this article, we will explore the various facets of starting a general trading company with the help of best company formation lawyers of UAE.What is a general trading company?
Before setting up a company, it is essential to understand its meaning. It refers to that company which is engaged in export, import and distribution of goods and products. The company is issued a general trading license which permits the company to trade multiple products from different industries, that could be completely unrelated to each other. E.g.: you can trade furniture, home applications, apparels and so on under this license. It may also include alcohol, guns or cigarettes.
Setting up a trading company
For company formation, it is essential to follow some steps, which are enumerated below
- Register a trade name
Just like a person is known and recognised by its name, similarly a trading company is also named to distinguish it from other business entities. An interested person needs to register the name of the company with the Economic Department of the respective Emirates. For deciding the name, you can take help of company formation lawyers and company formation law firms, having specialised expertise in the area.
However, it is important to note that there are certain restrictions while choosing the name. The name shouldn’t be offensive; the words referring to Allah, religious groups, political groups, etc should be strictly avoided. Further, the name shouldn’t be identical or in resemblance with any existing company. As suggested by best company formation lawyers, while making an application for registering the trade name, you will be issued a transaction number, which can be used to track the status of your application.
- Take Initial approval
For proceeding ahead in company formation in UAE, it is essential to take the nod of the government that it doesn’t have any problem with the company.
The top lawyers of UAE have also suggested that for a foreign investor, it is essential to obtain the approval of the General Directorate of Residency and Foreigners’
- Memorandum of Association (MOA) and Local Service Agent
The MOA is the constitution of the company containing all the essential information about its objective, functioning, share capital, etc. For drafting MOA, you should approach best company formation lawyers of UAE. It is also essential to appoint a local service agent. While drafting the agreement, it is essential to comply with all the applicable legal requirements. The agreement must be attested through a notarized public or the court.
- Submit documents and get business license
The last step in company formation in UAE is getting the trade license from Economic department. For getting a license, following documents should be submitted before the department-
- Receipt of the initial approval from the government;
- Copy of the lease contract duly attested by the Real Estate Regulatory Agency (RERA) in Dubai;
- Attested Memorandum of Association and Service Agent Contract.
You need to make a payment within 30 days of receiving the payment voucher to get the license. In case of failure, your application may be cancelled.
In Short
For setting up a trading company, it is essential to comply with all the above-mentioned steps and get the necessary approvals. BSB Legal is the best law firm of UAE with top lawyers engaging in company formation, drafting documents, and obtaining necessary approvals. To register your company with BSB Legal, contact us below.