Ajman Mainland Business Setup

Are you struggling to find an efficient way for business setup in Ajman Mainland? Many entrepreneurs face issues like high costs, complex procedures, and confusing legal requirements.

Starting a business in Ajman is cost-effective and offers various advantages. Foreign investors are drawn to its affordable setup process and strategic location on the Arabian Gulf Coast.

Advantages of Company Formation in Ajman Mainland

Company establishment in Ajman Mainland offers many benefits, making it an attractive location. Read more to understand these advantages of company setup in Ajman fully!

Strategic Location for Company in Ajman Mainland

Ajman is the smallest of the seven emirates in the UAE, yet yet has one of the most-populated cities in the country. Ajman’s location on the Arabian Gulf Coast makes it a prime spot for business. It’s near Umm Al Quwain and Sharjah, enhancing its appeal to foreign companies. The city’s proximity to major hubs like Qatar, Abu Dhabi, and Kuwait boosts trade opportunities.

The UAE ranks 25th in global competitiveness. In 2020, Ajman was 16th in the World Bank’s Ease of Doing Business Report. These rankings attract investors looking for efficient processes and fewer liabilities.Firms can access both local and regional markets easily from Ajman.

Flexible Legal Requirements

Ajman Mainland now offers relaxed legal rules for business setup. As of June 2021, foreign investors no longer need a UAE national partner to hold 51% ownership in nearly a thousand commercial activities. This change makes it easier and less restrictive to start businesses.

Professional licenses for business setup provide another advantage. They allow 100% foreign ownership with the help of a Local Service Agent (LSA). The LSA is a UAE national but does not own any shares in the business. Thus, foreign entrepreneurs can fully control their ventures without losing ownership rights.

Access to a Wide Market

Ajman Mainland offers strategic benefits for businesses. Its central location provides access to various markets. It connects firms to the entire UAE and beyond, thanks to its position in the Gulf Cooperation Council (GCC).This makes Ajman a perfect hub for expanding your business reach.

Setting up a business here opens doors to many opportunities. The extensive market includes both local consumers and regional partners. Being part of the Arab League and the UN adds credibility. These connections help attract investors and clients from all over.

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Key Takeaways

Steps for Company Setup in Ajman Mainland

First, identify your business activity. Then, secure a local sponsor to support your venture. For detailed steps on company registration and identification requirements, continue reading.

Choose a Business Activity

Choosing a business activity is crucial for company formation in Ajman Mainland. Investors must select from various activities like real estate, construction, consultancy services, or trading. Each option has its own set of requirements and costs. Proper planning can save time and money.

The chosen activity should align with the investor’s skills and market needs. Real estate offers high returns but demands significant capital. Consultancy services require specialized knowledge but involve less initial investment. Trading can be lucrative but involves more regulatory compliance. Select wisely to ensure long-term success for your company in Ajman Mainland.

Find a Local Sponsor

Choosing a business activity leads to finding a local sponsor. Many Ajman businesses need a UAE national as a sponsor for legal reasons. This person holds no ownership shares but helps with paperwork and permits.

A professional license is necessary as it enables 100% foreign ownership with just a Local Service Agent (LSA). The LSA offers support without taking an economic interest in the business. This change, made as of June 2021, allows nearly a thousand commercial activities greater flexibility.

Trade Name Reservation

Choose a unique trade name for your business. This name must be approved by the Ajman Department of Economic Development (DED). The approval process ensures that no other company uses the same or a similar name.

Next, follow the guidelines set by DED to reserve your chosen name. Submit an application with all required documents, such as passport copies and lease agreements if needed. Once approved, you can move forward with obtaining your business license in Dubai. This step is crucial in setting up any corporate entities in Ajman Mainland smoothly.

Obtain the Business License in Ajman

The process of Ajman Mainland company formation begins with obtaining a business license. Submit the necessary documents, which include a completed application form and proof of trade name reservation. Submit these to Ajman’s Department of Economic Development (DED). Approval usually takes 5-7 working days.

Once approved, pay the required fees to collect your license. The cost depends on your type of business and chosen activity. With this license, you can legally operate in Ajman Mainland. This is the mandatory step in the process of business setup in Ajman, whether you’re venturing into trading or offering professional services like legal consulting or engineering.

Types of Licenses Available for Business Setup in Ajman Mainland

Ajman Mainland business setup offers various licenses to cater to different needs. Choosing the right license that aligns with the nature of your business is crucial for legal operations and growth.

Professional License

A Professional License in Ajman Mainland allows 100% foreign ownership. You need a Local Service Agent (LSA) to represent you. As of June 2021, foreign investors no longer need to give 51% ownership to a UAE national partner for nearly a thousand commercial activities.
This license covers services like consulting, legal advice, and medical practices. It is ideal for individual entrepreneurs and skilled professionals. The process involves getting the right documents and approvals from the Department of Economic Development (DED) in Ajman.

Trading License

A trading license lets you sell specific goods in Ajman Mainland. It covers activities like import, export, and re-export of different types of business products. Thousands of commercial activities qualify for 100% foreign ownership with a trading license in Ajman.
To get this license, first determine the exact type of business you want to start. Next, find a local sponsor to partner with. Reserve a trade name for your company. Finally, submit all documents required for the process to the government of the UAE and obtain your business license.

Industrial License

Industrial licenses in Ajman allow logistics and manufacturing activities. The Ajman Free Zone, which was established in 1988, is situated in the emirate of Ajman, surrounded by four seaports and two international airports. Ajman Free Zone is home to about 256 industrial enterprises, making up 20% of the UAE's total industrial units. This makes it a major hub for production in the region.

General License

This type of business license for general maintenance is for companies that provide repair and maintenance solutions, electrical, plumbing, carpentry, air conditioning, and general maintenance services of property. This license allows organizations to work in every area of Ajman Mainland in regard to maintenance services for residential and commercial properties.

E-Commerce License

Ajman has also capitalized on the newly established online businesses by having an e-commerce license which allows businesses to transact online. This license empowers the license owners and entrepreneurs to market their products and services directly from their sites or through the third-party site. It can easily be used as a first step into accessing the fast growing e-commerce business without having to establish a physical business premise.

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Authorized Legal Entities in Ajman Mainland, UAE

Ajman Mainland offers various types of company structures. Each has its own rules and benefits for business owners.

Sole Proprietorship 

A Sole Proprietorship in Ajman Mainland is a simple way to start a business. One person owns it and runs it. This setup is easy and quick to establish. You will have full control over the business decisions. Foreign investors can own 100% of their businesses without needing a local partner for certain professional activities. This change makes starting a sole proprietorship easier for non-UAE nationals.
Essentials include registering the company, obtaining licenses such as a trade license, and ensuring compliance with local laws.The costs are lower compared to other setups like limited liability companies (LLCs). The owner enjoys direct tax benefits but also holds complete liability for any debts or losses. Ensuring compliance with legal requirements is crucial to avoid penalties from authorities in the United Arab Emirates (UAE).

Limited Liability Company

A Limited Liability Company (LLC) in Ajman Mainland can have between 2 to 50 shareholders. Shareholders' liability is limited to the capital they invested. This makes it a safe option for many entrepreneurs.
Forming an LLC requires compliance with certain legal steps and requirements. Submit a Memorandum of Association (MoA) and secure initial approvals. Rent office space as per regulations. Setting up an LLC offers several benefits, including flexible legal requirements and access to wide markets. Businesses enjoy strategic advantages due to Ajman's location within the Gulf Cooperation Council (GCC).

Private Joint Stock Company

A Private Joint Stock Company (PJSC) in Ajman Mainland needs at least 51% of its paid-up capital owned by UAE nationals. This structure works well for large investments and diverse shareholder bases. Investors must ensure they comply with local ownership rules.
Process of setting up a PJSC involves several legal steps. These include preparing the Articles of Association and getting approval from authorities. This entity type offers flexibility in raising capital through shares. It's suitable for businesses aiming to attract substantial investment while operating within legal frameworks in Ajman mainland.

Civil Company

Mainland business setup involve starting a Civil Company in Ajman with 100% foreign ownership. To set up one, you need a Local Service Agent(LSA). Ajman business setup consultants assist through this procedure. A trade license is also necessary to operate the company. Prerequisites such as the Anti-Money Laundering and Ultimate Beneficial Ownership (UBO) are readily appreciated among units. For company registration in Ajman, user needs to upload a copy of his ID proof and address verification. For most of the commercial activities, the Ajman DED has given the liberty to do away with the 51% local ownership.

Single-Owner Business or Sole Proprietorship

A sole proprietorship in Ajman Mainland is a business entity owned and managed by a single individual who exercises complete control over its operations and assets. Pursuant to this structure, full ownership rights are garnered, relatively ease in formation, and immediate taxation based on personal income is enjoyed. However, it also imposes unlimited liability on the owner since the owner is responsible for all debts or obligations of the business. Sole proprietorships in Ajman are mainly exclusive for UAE/GCC investors but allow limited shares of foreign investors to conduct business involving services. This structure is suitable for independent professionals or small businesses,  as it requires minimal regulatory compliance and allows owners to retain full profit control.

Branch Office of a Foreign Company

A Branch Office allows foreign companies to establish a physical presence in Ajman Mainland, enabling them to conduct business activities equivalent to those of the parent company abroad. Also unlike a locally incorporated company, Branch Office is legally a branch of the foreign parent entity and the parent entity remains fully legally responsible for it and all of its activity in Ajman. The setup is advantageous for the foreign companies aiming to expand into the UAE market without establishing a separate legal entity. Branches must hold local licenses and rely on a local service agent that undertakes administrative tasks; all the while being controlled by their foreign parent company.

Representative Office of a Foreign Company

The Representative Office is the structure that enables foreign corporations to establish a low-risk presence in the Ajman Mainland without generating revenue. Technically, a Representative Office is not permitted to directly participate in business activities that generate revenue in the host country. However, it is capable of advertising the services and/or products of the overseas parent company, gathering information about the target market, and establishing positive relationships with potential customers in that country. Depending on the size of the stock holdings, this model may be suitable for a company that wishes to gain a sense of the Ajman market with minimal operational and investment exposure. A Representative Office establishes the foundation for the future development of a foreign company by focussing on promotional activities, which increase the company's visibility in the target market.

Public Joint Stock Company (PJSC)

A Public Joint Stock Company (PJSC) in Ajman Mainland is an organizational form for large businesses that want to float shares to the public. In a PJSC shareholders have limited liability, which implies their risk is limited by the amount of capital they invested. Shares are available to the public, making this structure adequate for large-sale projects that require significant capital investment.
Establishing a PJSC requires adherence to strict regulatory guidelines, including the minimum number of shareholders and capital thresholds, ensuring transparency and accountability. PJSCs are highly regulated to protect shareholder’s interests and are subject to rigorous reporting standards, making them ideal for companies looking to expand through public investment and supervision.

Compliance and Legal Requirements for the Process of Business Setup in Ajman

Securing the required approvals and documents is crucial for your Ajman Mainland business setup. Follow local laws to avoid issues later on.

Initial Security Approval

Initial Security Approval is needed for high-risk business activities. Get this approval from relevant government authorities before starting other steps. Without it, you can’t proceed with your Ajman Mainland business setup.

High-risk businesses include those dealing with human capital or work permits, among others. Make sure to check if your activity falls into this category early on. This step ensures that your business meets all legal requirements and safety standards right from the start.

Memorandum of Association (MoA)

Drafting the Memorandum of Association (MoA) is a key step. The MoA outlines the company’s structure, shareholder details, and business activities. It must be notarized to be valid.

The MoA serves as the company’s blueprint. It includes key information like names of shareholders and their shares. This document helps in smooth company formation in Ajman Mainland.

Physical Space Requirements

After the Memorandum of Association (MoA) is ready, you must secure physical space for your business. Ajman Mainland requires this step to be completed before issuing a trade license. Signing a lease agreement for office space is mandatory.

The leased office must meet specific standards set by local authorities. It ensures that your business operates in an official and recognized location. Without this, getting approvals and licenses becomes impossible. This formal setup helps maintain the integrity and reputation of businesses within Ajman Mainland.

Factors like location, size, and cost should be considered when choosing office space. Your choice will impact your daily operations and overall costs. In some cases, shared or co-working spaces might offer flexibility and reduce expenses without compromising on requirements.

The costs for setting up a business in Ajman Mainland include fees for licenses, visas, and other administrative expenses.

For offshore company formation in Dubai, you need to submit the business application form and register with relevant authorities, complete the necessary paperwork, and comply with local laws.

Ajman does not impose income tax or capital gains tax on businesses. However, corporation tax may apply depending on your business activities.

DISCLAIMER – 
This content is for informational purposes only and provided “as is.” We make no guarantees about the accuracy, completeness, or suitability of the information. Any reliance on it is at your own risk. We are not responsible for any losses or damages resulting from its use.
Fees and costs mentioned are for reference only, subject to change, and may vary based on individual circumstances.