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Geographically, Dubai is the largest city in the United Arab Emirates (UAE), and is located in the Arabian Desert. It is considered as the commercial core of the Middle East, with an internal gross product of $ 107.1 billion. The city of Dubai has become one of the most developed economies in the world.

The interview below offers fundamental information about business opportunities in Dubai.

Alexandros, we welcome you back to Offshore World. It is a pleasure to have him with us. We would like to start this interview with the following question:

Could you explain to Mundo Offshore readers what IBCs are?

It is a pleasure for me to visit you again. Your site is an excellent information platform for any individual or organization that wishes to build its heritage and "plant flags" abroad.

An International Business Company (IBC) is the ideal option for any type of business that does not require a local office, which includes any type of passive investment activity, such as owning shares in local or free zone companies , own real estate in the UAE or carry out commercial activities outside the UAE. IBCs cannot rent an office space or request personnel visas; In addition, they are prohibited from trading if the parties are within the territory of the UAE. The Ras al-Khaimah IBCs (RAK) include the following interesting features:

  • The owner or manager does not need to visit the UAE personally.
  • It is not required to deposit capital in a bank account.
  • The only data included in the public records are the name of the company and the date it was incorporated.
  • It is not required to present a report of the financial statements.
  • Foreign companies can only be established through a registered representative with a license.
Characteristics of the establishment of a foreign company in Dubai:

  • Minimum taxes
  • Confidentiality
  • Reduced administration
  • Asset protection
  • Low maintenance costs
What differentiates this type of structure (IBC) from the others (for example, a SRL or conventional corporation)?

That is a very good question. Thanks for your interest.

I repeat the main differences that must be taken into account.

The most important difference is that an SRL has permission to trade within the UAE; however, IBCs do not have that authorization.

51% of the shares of a SRL must necessarily belong to a national UAE company (the "local partner"), while a foreign company can retain 100% of the shares of an IBC.

In addition, the SRL must submit audited financial reports every year, while an IBC does not have that obligation.

Why would you recommend Dubai as the right place to establish a VBI?

I recommend Dubai and the UAE as excellent options for establishing an IBC.

Mainly, this is due to three important reasons: the reputation of the UAE as a jurisdiction, the economic stability of the country and the ease of doing business with both the public and private sectors.

First of all, the reputation of the UAE as a jurisdiction has been consolidated, for example, thanks to the fact that European countries do not consider that nation as a tax haven, and there are no important scandals or schemes of tax evasion.

Second, the economy of the UAE is legitimate and presents a solid banking, retail and tourism sector. The UAE has a developed economy that recently received the A + credit rating from Fitch and Moody's; they also have a favorable perspective. The talent and diversity of the UAE workforce must also be complemented. You can count on a group of hardworking and efficient professionals capable of facing the difficulties of today's world.

Third, I will talk about the public and private sectors. In the last ten years, the public sector of Dubai and the UAE was incredibly fast and very efficient. You can create an IBC company in a few days. It has access to common law courts that can solve inconveniences related to Anglo-Saxon law.

Is it necessary to establish a local office?

There is no need to establish an office for the IBC. However, an IBC can own real estate anywhere in the world.

What kinds of businesses can be carried out by IBC in Dubai?

Most of my clients use the IBC for the following reasons:
  • Favor investment and trade worldwide.
  • Operate as a parent company.
  • Operate as a special purpose entity in order to own real estate or other assets.
  • Operate as a joint company.
  • Provide a family fortune management office to facilitate asset management and asset protection.
Are there restrictions for this structure (IBC) in Dubai?

Currently, the restrictions are that IBCs cannot do business within the UAE, offer residency visas or obtain certificates of tax residence for both the company and the shareholders.

Those are the main restrictions. However, there are no restrictions on activities.

Finally, why would you recommend establishing an IBC in Dubai?

As I said in my previous answers, the three most important reasons are the UAE's reputation as a jurisdiction, the economic stability of the country and the ease of doing business with the public and private sectors.

An additional advantage of having an IBC in Dubai is the Registration of Testamentary Validations (WPR) of RAK ICC (RAK International Corporate Center), which is part of an exclusive partnership with the Dubai International Financial Center (DIFC, for its acronym in English). At present, people who are not of Muslim origin can register their wills in order to guarantee the distribution of the assets and the appointment of legal guardians according to their own interests. As a result, the assets are distributed among the heirs according to the will of the interested party.

If you want to establish an IBC in one of the fastest growing economies in the world, do not miss this opportunity to do business in Dubai.

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