Company Formation in Abu Dhabi

Registration Authority

Abu Dhabi Registration Authority within theAbu Dhabi Department of Economic Development.

Legislation

Federal legislation of the UAE, in particular Federal Decree-Law no. (32) of 2021 On Commercial Companies.

Foreign Ownership

UAE mainland companies may be fully owned by foreign shareholders, whether individuals or legal entities.

Licensing

All UAE companies, regardless of the place of registration, must hold a license authorizing them to conduct their declared activities.

A standard economic license in Abu Dhabi covers up to six business activities and is suitable for mainland companies of any legal form.

Forms of Companies

Abu Dhabi mainland companies can be registered as:

• general partnerships;
• limited partnerships;
• limited liability companies (LLC);
• private joint-stock companies; 
• public joint-stock companies;
• branches of foreign companies.

Mainland companies are most commonly registered as LLCs.

Office Space

Mainland companies must have a physical office in Abu Dhabi. The availability of the office premises is confirmed by a lease agreement, which must be registered in Tawtheeq, the contract registration system.

Financial Statements and Audit

Mainland companies in Abu Dhabi must maintain accounting records and prepare financial statements. The company’s financial statements must be audited.

Taxation

Abu Dhabi mainland companies are subject to taxation in accordance with the general company taxation rules applicable in the UAE:

• corporate income tax – 0% for taxable income not exceeding AED 375,000 and 9% for taxable income exceeding this amount;
• VAT – standard rate of 5%, with mandatory registration if taxable turnover exceeds AED 375,000 over the past 12 months;
• excise taxes applicable to certain goods.

Registration Authority

A company is registered through the regulatory authority of the respective free zone.

Legislation

Each free zone in Abu Dhabi enacts its own regulations governing corporate matters, such as incorporation and functioning of companies.

At the same time, free zone companies are also subject to the UAE federal laws.

Foreign Ownership

Abu Dhabi free zone companies may be fully owned by foreign shareholders.

Licensing

The types of licenses may vary depending on the specific free zone.

Forms of Companies

The most common types of companies in free zones include:

• FZCO (Free Zone Company),
• FZE (Free Zone Establishment), 
• branches as well as
• other forms of companies stipulated by the legislation of the respective free zone.

Office Space

Free zone companies are not always required to have physical office premises. In most cases, a flexi-desk in a business centre is sufficient.

Taxation

Under certain conditions, free zone companies may benefit from a 0% corporate tax rate.

The following free zones:

• Free Trade Zone of Khalifa Port,
• Abu Dhabi Airport Free Zone and
• Khalifa Industrial Zone

have the status of “designated zones” for VAT purposes. This means that VAT does not apply to:

• supplies of goods within these zones;
• imports of goods into these zones; and
• transfers of goods from one designated zone to another.

Financial Statements and Audit

Abu Dhabi free zone companies must maintain accounting records and prepare financial statements.

Moreover, the preparation of audited financial statements is one of the conditions for a company to qualify for the 0% corporate tax rate.

Specialisation and types of licenses

An international financial centre. Companies can be granted licenses in the following categories: 

• Financial (e.g. banking, asset management etc);
• Non-financial (e.g. holding business, consultancy and other business services, real estate etc.) and
• Retail (retail sales and providing services.

Forms of Companies

• Private and public companies limited by shares;
• Private companies limited by guarantee;
• Private companies unlimited;
• Partnerships;
• Branches of foreign companies or partnerships;
• SPV companies; and
• ADGM foundations.

Office Space

Companies must have at least a permanent workspace within the ADGM.

Specialisation and types of licenses

The Masdar City Free Zone hosts mainly technological companies operating in the fields of renewable energy, innovation, sustainability, and healthcare.

Masdar City offers a wide range of specialized licenses, for example in the areas of:

• renewable energy;
• human resources;
• marketing and events;
• healthcare;
• clean technologies, among others.

Depending on the selected service package, a license may include up to six business activities.

Forms of Companies

The Masdar City Free Zone offers the following legal structures:

• a free zone Limited Liability Company (LLC);
• a branch of a foreign or a UAE-based company.

Office Space

A company may choose:

• a flexi-desk in a shared workspace;
• serviced offices, and 
• larger core and shell units that can be customized to meet the specific business needs.

Specialisation and types of licenses

Twofour54 is suitable for companies operating in the media sector, creative industries, and digital content production. In particular, the free zone issues licenses in the following areas:

• general media activities;
• gaming and e-sports;
• broadcast and publishing.

Forms of Companies

The business can be registered as

• a free zone limited liability company;
• a branch of a foreign or a UAE-based company.

Office Space

The following types of office premises are available in Twofour54:

• a flexi-desk in a shared workspace;
• serviced offices, and 
• core and shell units.

Specialisation and types of licenses

Abu Dhabi Airports Free Zone (ADAFZ) is an integrated airport free zone focusing on three Abu Dhabi airports.

ADAFZ is suitable for companies operating in:

• logistics;
• international trade;
• aviation industry and
• distribution.

Companies may apply for industrial, trading, and service licenses.

Forms of Companies

Businesses can be structured as:

• limited liability companies
• branches of foreign, UAE-based, or free zone companies.

Office Space

Apart from office premises, ADAFZ offers a full range of property solutions, including:

• warehouses,
• furnished and semi-furnished business centres,
• hangars, as well as
• serviced plots of land for development.

Specialisation and types of licenses

TheIntegrated Trade, Logistics and Industrial Zones of Abu Dhabi under the management of KEZAD Group was established to consolidate and develop specialized economic zones and the KIZAD industrial zone in Abu Dhabi.

The territory managed by the KEZAD Group is best suited for companies operating in:

• trade and logistics;
• automotive industry;
• food processing; and 
• polymers, among others.

Companies may obtain industrial, trading, or service licenses.

Forms of Companies

Businesses can be structured as:

• limited liability companies;
• branches of foreign, UAE-based, or free zone companies.

Office Space

Apart from standard office premises, companies may use:

• warehouses,
• plots of land,
• other industrial facilities.