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Buying a Home in Dubai - Some Tips and Laws That You Should Know
The Dubai Studio City, located to the north of the Persian Gulf on the Arabian Peninsula is now one of the fastest growing real estate developments in the world. Located close to Dubai on the UAE’s northern coast, the city has been designed around a green belt of land that is separated into nine zones. Each zone is completely pristine of all kinds of natural and man-made influences. This design feature is what sets this unique property from other real estate developments in Dubai. Located on dry land, property developers are free to incorporate any form of development into the plan for their developments, which can often include luxurious villas, resorts, sky scrapers, hotels, shopping malls, and all other forms of real estate development.
As Dubai is an entirely self-contained area, there are no legal requirements for local residents to obtain a license to reside or work in the city. This, in itself, creates an influx of skilled workers from across the globe who have the legal right to reside and work in this pristine environment. Residents have full access to all public services including education, healthcare, employment, health, and social welfare services without any problems. There are no restrictions on travel within the city limits and foreigners are also free to visit any part of the city they choose. This, in itself, makes Dubai a sought-out location for individuals looking for permanent residences and businesses looking for potential franchisees.
Despite its popularity, it is still necessary for foreigners to adhere to some laws when they purchase property in the city. The law is almost identical to that governing normal, real estate transactions in the United States. Property developers are required by law to apply the law consistently to each new project they develop and present to buyers. Developers are also required to perform title searches on all new properties they present to the public. All property should be registered in the name of the person who owns it and not in the name of an entity. If you are considering purchasing Dubai real estate, it is important that you familiarize yourself with these laws.
Despite its popularity, it is still necessary for foreigners to adhere to some laws when they purchase property in the city. The law is almost identical to that governing normal, real estate transactions in the United States. Property developers are required by law to apply the law consistently to each new project they develop and present to buyers. Developers are also required to perform title searches on all new properties they present to the public. All property should be registered in the name of the person who owns it and not in the name of an entity. If you are considering purchasing Dubai real estate, it is important that you familiarize yourself with these laws.
Another concern that most buyers have is the existence of the “Door Money”, which is a term used to describe a payment made directly from the property developer to the seller. The door money is used for the payment of a service tax and other fees and penalties related to the development of the property. Unfortunately, a lot of the time, door money is used for the payment of the Dubai airway tax. It is a widely practiced practice that can lead to huge legal fees for the developer, which results in a loss for the buyer and a lower price on the property.
- There is one specific law that is applied in Dubai Studio City that has the potential to affect your purchase of a home. This law, known as the “Abu Dhabi Property Law”, prohibits the transfer of an apartment or a hotel to a person or an entity located outside of the emirate. This law was implemented in response to the construction of many residential buildings in the United Arab Emirates with foreign investors. This can be risky if you are planning to buy property in Dubai with investment purposes, but it is important to note that this law only affects new construction and not existing properties.
Top 3 categories of licenses issued in Dubai to register a company
Depending on the nature of the activity a business entity plans to undertake, license in one of these categories will be issued:
1. Commercial License – is issued to a company who will engage in any kind of trading activity.
2. Industrial License – is issued to a company who will engage in manufacturing or any industrial activity.
3. Professional License – is issued to service providers, professionals, artisans, and craftsmen.
The Dubai Economic Department for Business Development in Dubai is the government agency who is responsible for issuing Dubai company/Business licenses. This department operates from several locations to deliver licensing services in Duabi, UAE.
- The very first step in the process of incorporating a company in Dubai is getting an effective legal name for the business entity. One can choose any name for the company including the name of the company, its address, the name of its director and the management team, and many more. The legal name of the company must comply with the laws of the country where it is incorporated. An expert firm will help you choose the name of the company accordingly. Another factor that you need to take care of is that the name of the company should not be confusing.
- Once you have selected the name of the company, you have to get the ownership of the business. If you are not aware of how do I start an LLC in Dubai, this aspect is the responsibility of the firm that you have chosen to do the task for you. As far as the ownership of the business is concerned, you need to get in touch with an experienced business lawyer who will help you carry out the procedure legally. Once you are done with the process of incorporating the company in Dubai, you need to register it at the Companies Registry. You will have to provide all the details about the nature of the business, the owners and the type of trade that you undertake. All these details are mandatory and you need to submit them along with the application form in the database maintained by the Registry.
- After getting the registration of the company, you need to register the company. This process can be done online or by visiting the Companies Registry office in the city. You need to pay a nominal fee for the registration and you need to provide the latest contact information of the directors to the registry authorities. If you are still wondering how do I start an LLC in Dubai? then you need to know that all this entire process can be completed within three months from the time of filing the first set of forms.
- Now, you need to decide about the capitalization of the business. This decision depends on your requirements and the profit margins that you can get from the business. For instance, if you are running a small retail business, then you can start a limited liability company with a capital of only a few thousand dollars. However, if you are planning to set up a manufacturing business, then you need to have a business plan that will include figures regarding the investments, profits, losses, etc. That is the reason why it is necessary to have a well-written business plan before starting the business.
- The next step in the process of how do I start an LLC in Dubai is to find a name for your company. It is not mandatory to choose the name of the company when you apply for its registration. But, if you are going to establish a limited liability company, then you have to use the name of your company or brand. Again, you have to select a trademark that will be able to represent your company and its products. For instance, if you are dealing in the manufacturing of sports equipment, then you can choose the name of the brand or you can even purchase a trademark from the trademark department of the United States Patent and Trademark Office.
- After you have chosen the name of your company and trademark, you need to register the name. This is done by filing the appropriate paperwork with the concerned office. However, you must remember that even if your company name is already registered, it does not mean that the name cannot be changed anytime in the future. Therefore, you have to keep this factor in mind. Even if you have registered your company’s name, you should still check on it once in a while so that you can make the necessary changes as and when necessary.
- One important point that you have to consider when you want to set up an LLC in Dubai is the formation procedure. You will have to complete the set of procedures and formalities required to get a legal registered company up and running. In addition, you will also have to abide by certain laws, regulations and rules in order to become functional as a business unit. In order to deal with these requirements, it would be better if you seek help from a company that specializes in establishing a limited liability company in Dubai. You can discuss the details of the company’s formation with this company and you can also take a look at the services that they are offering to get the ball rolling.
The Abu Dhabi property law is another important factor that buyers should take into consideration before purchasing property in Dubai. Although this law does not directly apply to the sale of apartments and hotels, it can greatly affect your purchase of a unit in one of these buildings. The law states that the ownership is solely held by the Abu Dhabi Company, which is controlled by the country’s crown prince. As such, if the developer sells a unit to an individual who is not a resident of the emirate, the purchaser will not receive the full rights to the property.