How To Convert A Dubai Offshore Company To A Free Zone Company?
Dubai has always been a centre of attraction, be it for tourists or business investors. Every time, the region lands up with innovative ideas that provokes the global business investors to invest their money as they can fetch handsome returns.
Just like the other popular offshore jurisdictions, the government of Dubai also provides the option of offshore investment that attracts millions of investors and multinational companies.
Ranging from onshore to free zone and offshore companies, Dubai expands its arms in all possible grounds.
Dubai Offshore (JAFZA) is one of the most demanding investment grounds when it comes to offshore company setup. However, what if one wants to convert an offshore company to a free zone company? Is that possible?
Well, the answer is Yes! A business investor can successfully convert an existing offshore company to a free zone company, provided the necessary legal proceedings are met accordingly.
One of the core reasons for converting an offshore company to a free zone company is to allow the business entities to operate as any other free zone company in other zones.
Also, on conversion, a free zone business entity can obtain a Tax Residency Certificate (TRC), that is issued by the UAE Ministry of Finance.
Offshore Company in Dubai
The offshore company is a legal entity that gets incorporated outside the country of residence of its owner. The concept of investing in an offshore industry has been rapidly increasing, and the Dubai Government is keen to provide the complete feasibility to the business investors.
Just like the onshore business ground, the offshore ground in Dubai is a profitable move for the business investors, and here’s the difference between the onshore and offshore company.
Over the years, there have been multiple reasons that a tax-haven jurisdiction provides to the business investors when it comes to offshore company incorporation, few of which includes:
- Tax exemption
- High-end confidentiality
- High-end asset protection
- Access to business-friendly legal system
- An access to offshore banking
- Flexibility to invest in international market
- Flexibility to get involved in Forex Trading
What is the Process to Convert an Offshore Company to a Free Zone Company?
The conversion of a company involves different steps that needs to be followed accordingly, that involves:
Submit the Company Resolution to the Registrar
The very first step is to notify the registrar regarding that the board has decided to convert the offshore company into a free zone company.
This process needs to be completed by submitting the Company Resolution stating the corporate form to be converted to.
An Application Needs to be Submitted
The conversion process can also be initiated through the submission of an application that contains the following details:
- Name of the shareholder(s)
- Nationality of the shareholder(s)
- Address of the shareholder(s)
- Amount of capital required for a Free Zone Company (FZC)
Any application made under the Regulation 118, should be submitted along with:
- The Company Resolution
- The Memorandum of Association (MOA)
- The Articles of Association (AOA)
- Copy of a valid certificate of incorporation of the Offshore Company
Verification of the Submitted Documents
Once the above-stated documents are submitted to the business registrar, it undergoes the verification process.
The next steps of the Registrar include:
- Offer the premise to be leased
- Issue a pre-written approval that the Offshore company is to be converted to a Free Zone Company
- Once the conditions satisfy, the business registrar issues:
- A business licenses
- A certificate of formation
- A revised memorandum of association
- A revised article of association
- Once the above documents get issued accordingly, the tax-haven company will be deemed to convert into a Free Zone Company. The Free Zone company shall comply with the complete provisions of the JAFZA Company Regulations.
As you have seen, the conversion of an offshore company to a free zone company involves multiple legal steps that need to be performed carefully in an error-free way.
Most of the business owners prefer to proceed with the expert’s guidance as it saves their time and also carry out the process in a quick and hassle-free manner. To know how, read our guide on the Core Reasons to Hire an Offshore Business Consultant.
At Business Setup Worldwide, we take the initiative of providing the best business solutions to the business investors so that they can operate their business tasks in a smooth-way.
Our business advisors are well-versed with the incorporation process and can provide you tailored solutions suiting your business needs.
If you are looking forward to converting your offshore business entity to a Free Zone Company in Dubai, then feel free to have a word with professional experts.