The United Arab Emirates is home to many foreigners and over the years the oil state has become a business hub for many companies. Many people moved to regional centers like Dubai and Abu Dhabi to do business and may live there for a long time. If you plan to do business in the UAE, either set up your own company and move there or extend your existing business to the region, you may need a local bank account.
The corporate law of the UAE is quite complicated. The different Emirates may do things differently, and there are many tax-free zones, and the rules related to the establishment of the company may vary. If you plan to establish your own business in the UAE, you may need formal legal advice to ensure that you cover all the basics.
How to open a company account in UAE?
- Opening a company/corporate account
- Business plan
- Right of abode
- Commercial facility
- Business activity
- Connect with your bank
The following is a summary of the most common business structures:
- Sole proprietorship
- General Partner
- Limited liability Company
- Branch or representative office of a foreign company (not in the tax-free zone)
- Public stock company
- Private joint-stock Company
- Free Zone Entity – may be wholly foreign-owned, but attached with certain restrictions.
Opening a company/corporate account
Usually, face-to-face meetings with banks in the UAE must be conducted before they can provide you with a corporate account. You need to process the paperwork and provide a signature before the account can run.
The length of time it takes to set up an account depends largely on the bank, account type, and business. In duty-free zones and locally registered limited liability companies, the time frame may be relatively short from 2 to 4 weeks, including your face-to-face meetings. In other cases, it may take longer.
There are many agents in the UAE that can help you gradually complete the process of opening a commercial bank account. They will charge a fee but may help you guide an account 2 that is right for your business. Be sure to confirm the required documents before entering the bank, as each file has its agreement. The file types you might need include:
- Complete application form
- Passport or other government identity documents of the owner and all shareholders
- Company registration certificate and business license
- Certificate of share
- Company memorandum and company charter
- The board of directors resolved the meeting minutes and confirmed that the account has been correctly approved.
As the central bank’s regulatory requirements are becoming more stringent, all UAE banks must be more rigorous in the screening process. As the demand for information and transmission data increases, banks have applied more stringent policies and rules.
Some banks now refuse to issue corporate bank accounts to companies established in certain jurisdictions. If the newly formed company is unable to open a banking business, then this will make it worthless. Thoroughly check before committing to ensure you have the right banking options for your business. The cheapest free zone option is not always the right option. The best value you can find is a compliant corporate structure that minimizes your risk and maximizes your monetization potential, now and in the future. Some banks have made extensive due diligence requirements for certain duty-free zones, and this applies primarily to certain duty-free zones in the Northern UAE.
Another trick for banks to join is to develop a solid business plan. Work creatively with all major banks every day and be proficient in developing a sound business plan to help get accepted by the bank faster.
Right of abode
The bank advises those who wish to apply for a bank account in the region to own and maintain UAE visas and UAE ID cards to increase approval opportunities. Also, the resident address reflects its commercial commitment to the local economy, which is even more positive from a bank perspective.
Some major banks now require formal office space to apply for a permit. We are witnessing that certain business activities and licenses associated with the Virtual/Flexible/Smart Desk option are no longer applicable to the Trading and Consulting categories.
Some business license activities are also subject to additional requirements. For example, most UAE banks do not open bank accounts for free-area companies engaged in general trading activities, and if the business owner owns a land/inland general trading company and warehouse, this is a bonus and will be boarded at the company bank account.
On the other hand, once the banking requirements are met, most UAE banks will allow mainland companies to open bank accounts relatively quickly. We expect mainland companies to grow substantially this year.
The company website can help increase bank credibility. If your site mentions some companies that work with you, you can verify your suppliers and customers and add extra points to the banker. If you don’t have a website, you can create a landing page using an easy-to-create website platform. Please note that this is not mandatory, but will add substance to your business. We recommend that you choose a free zone that matches your brand and goals, as this may better showcase your business during your application process.
Connect with your bank
Business owners must comply with and meet the requirements of the bank. Make your bank customer relationship manager easier by being completely transparent and quickly sharing all the documents you need. As a result, your company account will be online faster. Establish a relationship with your banker and inform them of all the customers and suppliers you will work with as this will prove their credibility. Notify the bank of any large payments you may wish to deposit as this will prompt them to process your application faster.
Don’t choose the easiest or cheapest company setup option, as it can be expensive in the long run; you may have to wait up to six months to get a bank account, and the regulations may change. If you meet all the requirements, please don’t let the above situation disappoint you. There is no big trouble to open an Emirates bank account. It is important to seek the right guidance in the corporate structure of both onshore and duty-free zones. So, can you afford to deal with the error? Is it worthwhile to seek advice from the company to set up an expert, rather than a friend who helps them before the compliance change? Is it worthwhile to listen to the cheapest, most inexperienced company to set up sales representatives? Are you right? This will help you save money, time and pain in paperwork and management tasks, which is essential for any company investing in its future.