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RAS AL KHAIMAH (RAK) OFFSHORE COMPANY INCORPORATION
Ras Al Khaimah (RAK), strategically located in the northern UAE, is fast becoming a top choice for international investors due to its unique position between the Hajjar Mountains and the Arabian Gulf, and proximity to Dubai. With its own free trade zone and port, RAK is a prime location for businesses looking to establish a foothold in the region.
If you want to know the process, timeline, and requirements of RAK offshore incorporation, then scroll down.
KEY REQUIREMENTS FOR COMPANY INCORPORATION IN RAS AL KHAIMAH
Business Name
For RAK offshore incorporation process, the name of the company must either be related to its business operations or derive from the names of one or more of its shareholders or directors. The suffix LTD or LIMITED is required at the end of the name. Words that convey a relationship to governmental entities or express religious principles will not be accepted.
Equity Capital
A RAK Company must have a minimum share capital of 1000 AED. The payment must be made in 1000 AED shares and be made in UAE dirhams (AED). Different classes of shares in one or more series may be issued by companies, each with its own set of rights, privileges, limitations, and constraints.
TIMELINE OF RAS AL KHAIMAH COMPANY INCORPORATION
KEY CHARACTERISTICS OF RAK OFFSHORE INCORPORATION
- Shareholders
For an international corporation to be registered with the RAK ICC, a minimum of one shareholder is needed. Shareholders of corporations are allowed. The capital structure of the business will be decided by the shareholders, who may issue shares with or without a par value. Bearer shares are not prohibited. Shares may only be issued in registered form.
- Company Secretary
The laws do not require the appointment of a company secretary, but one is typically made to make signing responsibilities easier.
- Directors
For an international company to be registered with the RAK ICC, at least one director is needed. Corporate directors are allowed, however, the firm must have at least one natural person as a director.
- Registered address
RAK ICC International Business Companies are required to choose an authorized registered agent and maintain a registered office address in the zone.
- Beneficial owners
A register of ultimate beneficial owners must be kept up to date and submitted to the RAK ICC authority by all businesses having RAK ICC registration.
- Accounting requirements
Every business is required to maintain accounting records, which must be kept for seven years after the date they were generated. The directors must approve the accounts and at least one of them must sign them. It is not necessary to submit the accounting to the RAK ICC authorities.
- Company names
The words limited or incorporated must end the names. The words assurance, bank, building society, chamber of commerce, chartered, cooperative, fund, imperial, insurance, municipal, mutual fund, royal, and trust as well as their related activities cannot be used. The registrar may allow names with foreign languages and characters.
- Timeline
After filing to the authority, it will take 4 to 5 days for the international business firm to be registered with RAK ICC.
- Taxation
RAK ICC International Business Companies do not pay any corporate taxes in the UAE. However, VAT can be imposed if there is taxable supply in the UAE. Since RAK ICC IBCs are not residents, they are not eligible for tax residency certificates and are not permitted to benefit from double taxation arrangements.
- Economic substance reporting
According to the requirements of the cabinet resolution, which mandates the submission of these notifications, businesses and establishments engaged in “relevant activities” in the UAE are required to submit economic substance notifications to the regulatory authority six months after the financial period and economic substance reports twelve months after the financial period.
- Restrictions
RAKICC International Business Company is not permitted to:
- Offer services or Conduct business with a customer or supplier based in the UAE;
- have a physical presence in the UAE,
- sponsoring shareholders, directors, and employees for residency in the UAE;
- unable to obtain a tax residency certificate.
TYPES OF BUSINESS ENTITIES IN RAS AL KHAIMAH
- Sole Proprietorship – A business owner can choose a sole proprietorship to have complete control over all business decisions.
- Joint Venture Company – A joint venture is an agreement between a local and a foreign party that doesn’t require licensing or publishing the agreement.
- Limited Liability Company – In Ras Al Khaimah, a firm may carry on business through an LLC. It can be established with a minimum of two shareholders and a maximum of fifty. It is compulsory to provide proof that capital has been deposited in a UAE bank in order to create a limited liability business.
- Public/Private Shareholding Company – A Public Joint Stock Company must be licensed by the Ministry of Economy and Commerce and have a minimum of ten shareholders. A minimum of 20% and a maximum of 45% of the company’s capital should be contributed by the founders.
There cannot be less than three stockholders in a private joint stock company. Shareholders must subscribe for at least AED 2,000,000 in total capital. A private joint-stock company’s shares cannot be offered for public subscription.
- Free Zone Establishment – An FZE (Free Zone Establishment) is a separate legal entity. Either a person or a corporate entity may own an FZE. AED 150,000 is the required minimum capital for establishing an FZE.
- Free Zone Company – A limited liability corporation (LLC) is a free zone company (FZCO). This can be registered by two or more shareholders.
- International Business Company – The international business firm idea was launched by the Ras Al Khaimah Investment Authority Free Zone (RAKIA) in January 2007. A global corporate corporation may have as many stockholders and directors as it likes. Directors and shareholders are not obligated to hold an annual meeting or submit audited financial statements.
The only information displayed by the International Business Companies (IBC) Registry is the firm name and the date of registration.
RAS AL KHAIMAH FREE ZONES
Compared to other UAE emirates, the city offers more cost-efficient company registration solutions. As a result, companies of all types and sizes favor company formation in Ras Al Khaimah. The free zones in Ras Al Khaimah are affordable, trouble-free, and have a welcoming environment for customers, which attracts other nations to establish their businesses here.
Ras Al Khaimah Investment Authority Free Zone (RAKIA)
To create and encourage an investment atmosphere in the free zone, the RAK Investment Authority was founded in 2015. Excellent investment support is offered by the free zone, which also guarantees low-cost, hassle-free Ras Al Khaimah business setup. The RAKIA free zone offers a prime location at the meeting point of east and west, great infrastructure, strong government support, and unmatched natural beauty.
RAK Maritime City – UAE Free Zones
It was established in 2001 and provides businesses looking for a productive and secure environment for their activities with international port facilities and business services.
The goal of the free zone in RAK Maritime City is to attract enterprises by offering a one-stop-shop with the benefits of a free zone environment, state-of-the-art, 21st-century harbour infrastructure within a developed and established port.
RAK Media Free Zone | Ras Al Khaimah Media Free Zone UAE
RAK Media City is an alternative to Dubai Media City Free Zone and is set in the year 2006. RAK Media City is an affordable alternative to Dubai’s free zones due to the rising cost of living there. Due to its commitment to providing top-notch facilities, first-rate business infrastructure, pre-built offices, and media-related business permits, RAK FTZ has attracted the attention of business owners.
RAK Economic Zone (RAKEZ)
The headquarters of the RAKEZ free zone is located in Ras Al Khaimah. By establishing a firm in the free zone area, RAK Economic Zone gives local and distant investors a platform to diversify their investments and enable them to enter local, regional, and global markets.
DOCUMENTS REQUIRED TO REGISTER RAK OFFSHORE COMPANY
Documents for a Single-Shareholder Company in RAK
- copy of your passport (Notarized)
- A letter of recommendation from a bank addressed to RAK Offshore Authority
- Proof of residency, such as an original utility bill or municipality certificate
- Curriculum vitae (CV) of the offshore company’s shareholder
- bank statement for the business’s most recent six months
Documents for a Multiple-Shareholders Company in RAK
- A certified photocopy of the applicant company’s business license or incorporation certificate
- Resolution of the shareholders
- Memorandum of Association (attested)
- The company’s certificate of occupancy, which includes the names of the shareholders and directors
- copies of each shareholder’s and director’s passports
- Certificate of Good Standing also referred to as a Certificate of Existence of the company
STEPS TO REGISTER A BUSINESS IN THE RAS AL KHAIMAH
Selecting the business entity
The applicant must first select an appropriate business. The services, location, and products must all be considered during this process. After completing this process, the applicant must consider the business’s legal requirements.
Determining the legal business structure
In RAK, various business entity types are present. As a result, the applicant must choose the business type and corporate structure. The candidate should also determine the location-related needs. RAK is divided into several jurisdictions, including the Mainland, Free Zone, and Offshore.
Register the trade name
The applicant then has to register the business’s trade name. This needs to be done at RAK International Corporate Centre. The firm’s unique name would be mentioned on the trade certificate. The business needs this to keep a sense of independence.
Before requesting final approval, the applicant must first obtain the initial permission. An initial approval would assist the applicant in obtaining the sort of business licence needed to operate the business. The Department of Economic Development (DED) will register a trading name for a firm in Ras Al Khaimah.
Getting approvals
The applicant would next need to obtain the necessary approvals from various regulatory agencies. Getting the licenses would be part of getting the approvals. In Ras Al Khaimah, there are three different licensing categories: general trade licenses, professional licences, and industrial licenses.
Obtaining Resident Visa and Corporate Bank Account Opening
Once the authorities have given their approval, the investor can apply for a resident visa and corporate bank account opening to streamline business operations and facilitate financial transactions.
PROS AND CONS OF REGISTERING A COMPANY IN RAS AL KHAIMAH
PROS
Outstanding Infrastructure
Ras Al Khaimah is recognized as one of the most advantageous places to base a business. This emirate has more than two seaports, which makes transportation easy. This area is one of the principal seaports that receive oil and cargo in the Middle East.
Free Trade Zone
Every emirate is well recognized for its free zones. The Ras Al Khaimah Free Zone company registration is a great substitute for Dubai company registration. This free trade zone is home to a variety of businesses and warehouses. Companies operating in this free trade zone are not subject to any kind of taxation.
Taxation
RAK has signed several types of double taxation agreements with various nations. As a result, any investments made by investors in these nations would not be subject to double taxation.
The procedure of registering a corporation can go smoothly in the Ras Al Khaimah Free Trade Zone (RAKFTZ). In this free trade area, there are no taxes. Any personal or capital gains taxes would also be included in this.
Suitable Location
Ras Al Khaimah is the northmost emirate. It is situated in the Straits of Hormuz and the Arabian Gulf. Both the Ras Al Khaimah Airport and the Dubai Airport are international airports. This would make travelling easy for many investors. Additionally, it serves as a hub for countries like Asia, Europe, and Africa.
CONS
Smaller Market
The market in RAK is smaller compared to other emirates, which can limit the potential for growth and profitability for businesses operating there.
Stricter Regulations
RAK may have stricter regulations and requirements for setting up a business, which can make the process more complex and time-consuming.
WHY CHOOSE RELIN CONSULTANTS FOR RAS AL KHAIMAH COMPANY INCORPORATION?
Relin Consultants have a team of professionals who are familiar with the laws of Ras Al Khaimah. Our team will guide you to select the most suitable business structure for your business. We will complete all the documents and paperwork regarding the trade licensing requirements, passports, and visas.
Reach out to us at Relin Consultants to know more about our business setup services in Ras Al Khaimah.
FAQs
Is it easy to set up a business in Ras Al Khaimah?
Setting up a business in Ras Al Khaimah (RAK) can be a complex process and may involve various legal and administrative steps, but the United Arab Emirates (UAE) government has taken several measures to ease the process of doing business and make it more attractive for foreign investors.
RAK offers a variety of free zones, such as RAK Free Trade Zone, RAK Investment Authority (RAKIA), and RAK Media City, which provide a range of benefits such as 100% foreign ownership, no corporate taxes, and easy access to markets. These free zones offer a one-stop-shop service for business registration and licensing, which simplifies the process of obtaining the necessary approvals and licences.
How can I check if a company is legal in Ras Al Khaimah?
You can check if a company is legal in Ras Al Khaimah (RAK) by checking if it is registered with the RAK Department of Economic Development (DED) and the RAK Chamber of Commerce and Industry.
You can also visit the DED website or the Chamber of Commerce and Industry website and search for the company’s name or trade licence number. This will give you information about the company’s registration status, trade licence details, and other relevant information. Additionally, you can check if the company has a valid commercial licence issued by the DED, which allows it to conduct business within RAK.
Is Ras Al Khaimah tax-free for business?
Companies operating in RAK free zones, such as RAK Free Trade Zone, RAK Investment Authority (RAKIA), and RAK Media City, enjoy 100% corporate income tax exemptions and 0% value-added tax (VAT) for the first five years of their operations. This makes it an attractive option for foreign investors looking to set up a business in the UA.
How long will it take to incorporate a company in Ras Al Khaimah?
It can take about 15 weeks to start a business in Ras Al Khaimah.
What is the Ras Al Khaimah free zone company registration cost?
The cost of company registration in Ras Al Khaimah (RAK) free zones can vary depending on several factors such as the type of business activity, the number of shareholders, and the size of the company.
What are the business licences available in Ras Al Khaimah?
In Ras Al Khaimah, there are three different business trade license in Ras Al Khaimah categories: general trade licences, professional licences, and industrial licences.
What documents are required for Ras Al Khaimah offshore company registration?
The documents required for company registration Ras Al Khaimah are A project description, company memorandum, and Articles of Association, copy of the shareholders’, directors’, and managers’ passports, incorporation paperwork, and the necessary bank deposit.
What kind of companies are eligible to be part of the Ras Al Khaimah Free Zone?
Ras Al Khaimah Free Zone (RAK FTZ) offers a variety of business activities that are eligible for company formation. Some of the most common types of companies that are eligible to be part of the RAK FTZ include:
Trading companies: These companies import and export goods and products, and are involved in wholesale and retail activities.
Consulting and professional services companies: These companies provide services such as legal, accounting, engineering, and IT services.
Industrial companies: These companies are involved in manufacturing and production activities, such as food processing, machinery and equipment, and chemicals.
E-commerce and online businesses: These companies operate online and conduct most of their business activities through the internet.
Service companies: These companies offer a wide range of services, including shipping, logistics, travel and tourism, and hospitality.
What is the minimum capital requirement for a company to set up Ras Al Khaimah?
To start business in Ras Al Khaimah, a company must have a minimum share capital of 1,000 AED.
Which laws are followed in RAK?
The laws that are followed in Ras Al Khaimah (RAK) are mainly federal laws issued by the United Arab Emirates (UAE) government, as well as the local laws and regulations issued by the RAK government.
Is having a physical office mandatory for RAK business?
Whether or not it is mandatory to have a physical office for a business in Ras Al Khaimah (RAK) depends on the specific requirements of the RAK free zone where you are incorporating your company.
In most of the RAK free zones, it is mandatory to have a physical office space, where the business activities of the company are carried out. This office space is usually leased or rented from the free zone authority and the size and location of the office will depend on the type of company and the nature of its business activities.
However, some free zones in RAK offer virtual office services, which allows the company to register and operate without the need for a physical office space. This option is intended for companies that conduct most of their business activities online or remotely, but this will depend on the free zone and their policies.
Which are the free zone parks in Ras Al Khaimah?
The Ras Al Khaimah Free Trade Zone Authority has established a system of four distinctive Free Zone Parks that cater to the unique needs of investors. The Four Parks model includes the Business Park, Industrial Park, Technology Park, and Al Ghail Park, which provide office spaces, furnished warehouses, and land facilities.
Located in various areas throughout the Emirate of Ras Al Khaimah, each Park serves the particular business interests and operations of RAK FTZ investors.
Is it mandatory to have a local resident director in RAK?
In Ras Al Khaimah (RAK), it is not mandatory for most companies operating within the emirate to have a local resident director. However, most UAE banks will require at least one of the directors to be resident in UAE prior to approving the corporate bank account opening.
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