How can foreign nationals acquire 100% ownership of LLC companies in Dubai?

Contents

What Is 100% Foreign Ownership in Dubai?

100% foreign ownership in Dubai means a foreign individual or corporate entity can hold the entire share capital of a mainland limited liability company, with no requirement for an Emirati shareholder or a local service agent. The change took effect on 1 June 2021 and applies across a broad list of activities published by the Dubai Department of Economy and Tourism (DET).

Under the previous regime, at least 51% of a mainland company had to be held by a UAE national. Investors tried to balance that requirement through side agreements, but the enforceability of those arrangements always remained uncertain. That structure is no longer necessary: the licence is issued directly in the foreign owner's name, and profit distribution and decision-making stay entirely with the investor.

The Legal Framework Behind Full Foreign Ownership

Three instruments need to be read together. Much of what circulates online still reflects the pre-2021 position, which is why outdated claims about a mandatory 51% Emirati shareholder keep resurfacing.

Federal Decree-Law No. 26 of 2020: Removing the 51% Rule

Federal Decree-Law No. 26 of 2020 amended the then-applicable Federal Law No. 2 of 2015 on Commercial Companies, removing the requirement for a majority Emirati shareholder and a local service agent for mainland companies. It became operative on 1 June 2021.

Cabinet Resolution No. 55 of 2021: Activities of Strategic Impact

Cabinet Resolution No. 55 of 2021, issued on 30 May 2021, defined the "activities of strategic impact" where full foreign ownership is either not granted or subject to additional conditions. In those fields, the ownership ratio and any extra requirements are determined by the licensing authority of the relevant emirate.

Federal Decree-Law No. 32 of 2021 on Commercial Companies

Federal Decree-Law No. 32 of 2021 came into force on 2 January 2022, replacing Federal Law No. 2 of 2015 and making full foreign ownership a permanent feature of UAE company law. The same statute raised the share of a public joint stock company that can be offered to the public, relaxed board and general assembly rules, and enabled electronic voting. The grace period for existing companies to align their constitutional documents expired on 2 January 2023.

Any source still citing "Federal Law No. 2 of 2015" as the operative text is out of date. The governing statute today is Federal Decree-Law No. 32 of 2021.

Which Activities Qualify for 100% Ownership?

More than 1,000 commercial and industrial activity codes in Dubai are open to full foreign ownership. Because eligibility is determined code by code, confirming the exact code against the current DET list before incorporation is essential. The same business licensed under a different code can carry a different ownership ratio, a different visa quota and different fees.

For the difference between commercial, professional and industrial licences and how codes map to them, the breakdown in Dubai DED licence types and activity codes is a practical starting point.

Sectors Where Restrictions Still Apply

The following fields are treated as being of strategic impact under Cabinet Resolution No. 55 of 2021. Full foreign ownership is not automatic here; the emirate's licensing authority and the sector regulator set the ownership ratio and any additional conditions.

Although the list is set federally, each emirate's economic department publishes its own implementation guidance. Abu Dhabi, for example, opened 1,105 commercial and industrial activities to full foreign ownership under its own list.

How to Set Up a Wholly Foreign-Owned LLC

With complete paperwork, incorporation in Dubai typically takes 5–10 working days. Activities that need sector pre-approval take longer.

For the company form itself — liability structure, shareholder numbers and manager appointment rules — LLC limited company formation in Dubai covers the mechanics in detail.

Documents Required

The core document set for a mainland LLC is as follows:

• Passport copies of all shareholders and the manager, valid for at least six months
• Passport-size photographs and any existing UAE visa or Emirates ID
• Trade name reservation certificate and initial approval letter
• Notarised memorandum of association (MOA)
• Ejari-registered tenancy contract or approved office agreement
• For corporate shareholders: apostilled and Arabic-translated registry documents, board resolution and power of attorney
• Sector permits from the relevant authority where applicable (DHA, KHDA, RTA, Dubai Municipality)

Where a corporate shareholder is involved, apostille and consular attestation is usually the longest item on the timeline. Start that step as soon as the incorporation decision is made.

How Much Does a Dubai LLC Cost?

There is no single figure. Activity code, office type, visa count and sector permits together determine the total. Official fees can be queried in real time through the DET fee estimation service. The table below provides a line-item framework for budgeting; the exact amount should always be taken from the official calculation.

A fuller cost breakdown by licence type is available in Dubai mainland company setup cost, and the documentation banks expect at account opening is covered in how to open a commercial bank account in Dubai.

Removing a Local Partner from an Existing LLC

An LLC incorporated before 2021 with a UAE national shareholder can be converted to full foreign ownership through a licence amendment. The sequence is:

1. Confirm the activity code appears on the current list open to full foreign ownership.
2. Pass a share transfer and amendment resolution signed by all shareholders, including the UAE national.
3. Sign the share transfer agreement before the notary public.
4. Obtain initial approval from DET and submit the amendment file.
5. Pay the fees and collect the amended trade licence and MOA.
6. Update shareholder records with the bank, Customs and the visa authority.

Where the local partner declines to transfer, the dispute is resolved under the arbitration or jurisdiction clause in the shareholders' agreement. Share valuation and historical profit distribution then become separate negotiation points. The procedural detail is set out in adding or removing a partner from a Dubai company.

Mainland or Free Zone?

Since full ownership is now available under both models, the decision turns on market access, tax status and cost rather than the shareholding ratio.

A side-by-side comparison on cost and operations is available in Dubai mainland vs free zone, and the conditions for 0% corporate tax in a free zone are explained in the qualifying free zone person regime.

Corporate Tax and VAT Obligations

The most common error in post-2021 content is the claim that the UAE has no tax at all. That is no longer accurate. Federal Decree-Law No. 47 of 2022 introduced federal corporate tax, applicable to financial years beginning on or after 1 June 2023.

Whether a newly incorporated company falls under the relief threshold is worth checking early; the eligibility test is covered in Dubai Small Business Relief. Filing deadlines and penalties for VAT are set out in VAT return filing for companies in Dubai.

Company Ownership and Residence Visas

A foreign shareholder in a mainland company can obtain a partner or investor residence visa through the company. The visa quota is set by office area and activity type, and can be extended as headcount grows.

The rule most often overlooked concerns time spent abroad. A UAE residence visa is nullified automatically if the holder stays outside the country for more than six consecutive months. The widely repeated claim that "entering once a year is enough" is not correct. Golden Visa holders hold a long-term status valid for five or ten years under a separate set of rules, with investor categories and thresholds published on the official government portal.

The step-by-step residence process through a mainland company is set out in company formation and residence permit in Dubai, and long-term status conditions in how to obtain a Golden Visa in Dubai.

Benefits and What to Watch For

What full ownership changes in practice is not only the share register, but who holds signing authority and decision rights day to day.

Recruitment quotas and reporting duties for mainland companies above certain headcounts are covered in the law on Emiratisation for private companies.

Common Mistakes

• Proceeding without verifying the activity code. Different codes for the same business change the ownership ratio, visa quota and fees.
• Relying on outdated sources. Content citing Federal Law No. 2 of 2015 no longer reflects the operative regime.
• Ignoring tax obligations. Late corporate tax registration after licence issuance triggers administrative penalties.
• Leaving the bank account until last. Companies incorporated without a prepared KYC file often wait weeks for account opening.
• Skipping share valuation when removing a local partner. Files without a pre-agreed transfer price end up in arbitration.
• Overlooking the six-month rule. Staying outside the UAE for more than six consecutive months invalidates the residence visa.

Running the Process with World Company Setup

World Company Setup handles mainland and free zone incorporation, licence amendments, corporate bank account opening, accounting and tax compliance as a single file from its office in Dubai Silicon Oasis. Removing a local partner from an existing LLC, moving an activity to a code eligible for full ownership and completing corporate tax registration on time are managed by the same team.

To confirm whether your activity code qualifies for full foreign ownership and to receive an indicative setup budget, submit the request form or call the office directly.

References

• The Official Portal of the UAE Government — Full foreign ownership of commercial companies
• UAE Legislation Portal — Federal Decree-Law No. 32 of 2021 on Commercial Companies
• UAE Legislation Portal — Cabinet Resolution No. 55 of 2021 on Activities of Strategic Impact
• The Official Portal of the UAE Government — Corporate tax
• UAE Ministry of Finance — Small Business Relief decision
• Federal Tax Authority — VAT registration thresholds
• The Official Portal of the UAE Government — Residence visa rules when travelling abroad
• Dubai Department of Economy and Tourism — Licence fee estimation services

Legal references and rates in this article were verified against the official sources listed above. Government fees vary by activity code and licence type, so the exact figure should be taken from the official DET calculation service.