How to Setup a Public Shareholding Company in Dubai, UAE: Step by Step Guide
Public Shareholding Companies (PJSCs) raise capital via tradable shares. Dubai mandates PJSC structure for banking, insurance, and finance. Foreign firms can establish a presence through branches or representative offices. Contact Smart Zones® UAE for PJSC formation in Dubai.
- Limited Liability
- Easy Business Setup
- Streamlined Fundraising
- Large-Scale Operations
A Public Shareholding Company (PJSC) is a corporate structure where the company's capital is divided into equal shares. Shareholders enjoy limited liability, meaning their financial responsibility is capped by the number of shares they own. To establish a PJSC in Dubai, a minimum of ten founding members is required. Management oversight is entrusted to a board of directors with 3 to 15 members, serving terms not exceeding three years. While founding members can hold up to 35% of the company's shares, the remaining portion must be offered for public subscription. UAE nationality is mandatory for the chairman and a majority of the board members in a PJSC. Notably, the law mandates that banking, insurance, and other financial institutions operate as PJSCs.
Why You Should Start Your Public Shareholding Company in Dubai, UAE ?
Dubai presents a compelling proposition for international investors seeking a regional presence through the establishment of a Public Joint Stock Company (PJSC). The emirate's well-regarded business environment offers a diverse range of legal structures for incorporation, coupled with access to a wealth of investment opportunities.
Investors are particularly drawn to the unique benefits associated with PJSCs, including the ability to conduct on-the-ground operations, capitalize on market opportunities, and secure prime office space.
Difference between PSC and PJSC companies in Dubai, UAE
The terms Public Shareholding Company (PSC) and Public Joint Stock Company (PJSC) are often used interchangeably. Both represent a type of business entity characterized by a capital structure divided into shares. This structure limits the liability of shareholders to their investment in the company. In the context of Dubai, PSC and PJSC are essentially synonymous.
Benefits of Establishing a Public Shareholding Company in Dubai, UAE
While Public Joint Stock Companies share the core benefit of limited liability with private limited companies, they possess several distinctive advantages that create a synergistic effect:
- Limited Liability: Similar to private limited companies, shareholders' financial risk is limited to their investment. This safeguards personal assets and attracts a wider range of investors, ultimately boosting capital inflows.
- Perpetual Existence: As a separate legal entity, a PJSC's existence transcends individual ownership changes. This ensures long-term business continuity, fostering stability and investor confidence.
- Large-Scale Operations: Publicly offered shares allow PJSCs to raise substantial capital. This financial power enables ambitious ventures and facilitates expansion plans.
- Enhanced Liquidity: Shares in a PJSC are freely tradable on stock exchanges. This provides greater investment flexibility compared to private companies with restricted share transferability.
- Streamlined Fundraising: Access to a vast pool of potential investors allows PJSCs to efficiently raise significant funds. This expedited capital acquisition fuels growth and development initiatives.
Steps to Launch a Public Shareholding Company in Dubai, UAE
This guide outlines the key steps involved in forming a PJSC within the Dubai jurisdiction:
Embark on the journey of opening a business in Dubai by partnering with Smart Zones® UAE. Our adept company formation specialists will guide you through the business license application and setup process, liaising with relevant government and municipal authorities on your behalf.
Choosing a unique and commercially appropriate name for your PJSC is the initial step. The name should adhere to Dubai's regulatory guidelines and effectively represent your brand identity.
Following name selection, securing initial approval from the DED is mandatory. This process may involve obtaining permits from other relevant authorities depending on your business activity.
Upon DED approval, a specified set of documents must be compiled and submitted for licensing purposes. These documents are essential for completing the company formation process.
Once the documentation is reviewed and approved, the requisite fees must be settled to finalize the licensing process and obtain your official PJSC business license.
Remember that the process may vary depending on your chosen jurisdiction and business activities. Consulting legal and business experts familiar with Dubai's business setup landscape is highly recommended.
Looking for a seamless business setup experience? Trust Smart Zones® Dubai to pave the way.
Minimum Share Capital Requirements for Public Joint Stock Companies (PJSCs) in Dubai:
- For standard Public Shareholding Companies, a minimum share capital of AED 10 million is mandated. The nominal value of each share must range from AED 1 to AED 100.
- Banking and insurance companies intending to operate as PJSCs face higher minimum capital requirements. Banking institutions require a minimum of AED 40 million, while insurance and investment companies necessitate a minimum of AED 25 million.
Documents Required to Start a Public Shareholding Business in Dubai, UAE
In accordance with the latest regulations, the following documentation is necessary to establish a Public Shareholding Company within the Dubai jurisdiction:
- Agreement outlining terms between founders, submitted with the business registration and licensing application.
- Formal approval from the relevant authority for the chosen business activity.
- A detailed document outlining the company's offering and inviting public investment.
- Authorization from the UAE Securities and Commodities Authority (SCA) to operate as a public shareholding company.
- Verification of the company's financial statements by a licensed auditor.
- Formal resolution granting permission for the PJSC structure from the Ministry of Economy.
- A comprehensive report evaluating potential risks and opportunities associated with the company.
- A detailed analysis of the project's viability and potential for success.
- Memorandum and Articles of Association (4 notarized copies). The company's governing documents, officially certified by a notary public.
- Office Lease Agreement and Plot Number (photocopies). Proof of secured office space with its designated plot number.
- Written confirmation from appointed board members accepting their respective roles.
- Original documents verifying names, date of birth, place of birth, occupation, and signature samples for each board member.
Submitting incorrect documents can lead to immediate rejection. Our consultants at Smart Zones® UAE ensure you have the right documents, avoiding any complications in the process.
Requirements to Start a Public Shareholding Business in Dubai, UAE
- Minimum of ten founding members required.
- Board of directors comprised of 3-15 individuals.
- Board member term limits of three years.
- UAE nationality requirement for chairman and directors.
- Minimum paid-up capital of AED 10 million (AED 40 million for banking, AED 25 million for investment).
To set up a Public Shareholding Company (PJSC) in Dubai, follow key steps: ensure UAE regulations compliance, partner with Smart Zones® UAE for guidance, select a unique trade name, obtain DED approval, submit licensing documentation, and settle fees for license issuance.
Dubai offers a favorable business environment, diverse legal structures, and abundant investment opportunities. PJSCs enable on-the-ground operations, market access, and prime office space, contributing to business success.
In Dubai, Public Shareholding Companies (PSC) and Public Joint Stock Companies (PJSC) are essentially synonymous terms, representing entities with share capital and limited liability.
Benefits include limited liability, perpetual existence, large-scale operations, enhanced liquidity, and streamlined fundraising, attracting a diverse range of investors and fostering long-term business continuity.
Standard PJSCs require AED 10 million share capital, while banking institutions need AED 40 million and insurance/investment companies need AED 25 million.
Necessary documentation includes founder agreements, business activity approvals, financial statements, resolutions, memorandums/articles of association, and UAE Securities and Commodities Authority (SCA) authorization.
Requirements include ten founding members, a 3-15 member board of directors, term limits, UAE nationality for key positions, and specific paid-up capital depending on business type.
Want to know more, talk to Smart Zones® Dubai advisory team they will be happy to help. Ready to invest in your future?
