Interesting facts:
Full versionA number of UAE jurisdictions (mainland and free zone) require the declaration of authorized capital, although the actual contribution of minimum capital is not always required. Here we will consider what authorized capital is and what its main functions are.
In fact, the share capital is the amount of money that is invested in the statutory activities of the company by its owners (shareholders, founders, and participants). Authorized capital can be used as an indicator of the company's financial structure but is not a guarantee of the fulfillment of obligations.
Contributions to the authorized capital of a legal entity may be made not only in the form of financial assets; in certain cases, other assets are also permitted, in accordance with the requirements of a specific UAE jurisdiction. If there are multiple shareholders, the share capital can be paid in one or more installments.
Clarify the cost of opening company, corporate or personal bank account, obtaining a residence visa, or another question regarding business in Dubai, UAE:
Formation of the share capital is one of the obligatory requirements during the registration of a legal entity. The capital's amount can vary based on the company's activity and current corporate law. In the UAE, minimum share capital requirements vary by free zone and license type; in many free zones, they are declaratory.
Information about the share capital, its form and size, are recorded in the incorporation documentation, and particularly in the Statutes of the newly created legal entity. The following assets can serve as the parts of the share capital:
Besides, the norms of the corporate law do not exclude the possibility of creating a mixed share capital, when it is formed at the expense of property and cash. In some cases, a temporary account may be opened to confirm capital, but in many free zones no actual capital deposit is required. Such an account may be temporary, and subsequently it can be converted into the regular account of the company. Funds deposited into this account as authorized capital may be used for the company's operations.
If non-cash assets are contributed, they may need to be valued in accordance with regulatory requirements. This valuation can be performed by an independent, licensed appraiser.
The size and structure of the authorized capital may be taken into account by banks when conducting KYC/AML checks when opening a corporate account.
Company registration in the UAE at all the stages, including the opening of an account for depositing a share capital, requires certain experience and knowledge. It is much more efficient to use the services of the professionals, so you will not have to spend your time on alteration of the documents and other formalities. Our qualified employees with long experience will perform everything in time and in accordance with your requirements.
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