Public Shareholding
Company Formation in Dubai
A public shareholding company is a joint firm or an open resource company where the business capital is divided into equal shares. It is also known as a Public Joint Stock Company (PJSC). For a Public shareholding company formation in Dubai, it is required to have at least 10 founding members with a board of directors of three to fifteen people who can serve for no more than a three-year term. As a result of their differing ownership stakes, each shareholder’s liability is constrained. As per the law of the UAE Government, business activities such as banking, insurance, and other financial operations can be established as a Public Joint Stock company (PJSC).
What are the Requirements for Public Shareholding Company Formation in Dubai?
DED has some rules regarding Public Shareholding Company Formation in Dubai.
- A Public Shareholding Company or Public Joint Stock Company in Dubai is required to have at least 10 founding members (the majority of them should be UAE nationals), and its administration should be conferred on a board of directors consisting of 3-15 persons whose term of service must not exceed for more than three years.
- The founding members are empowered with 35% of the share capital, and the remaining 65% is required to be offered to the public.
- The Chairman and majority of the directors in a public shareholding company must be UAE nationals.
- Must have a minimum capital of AED 10 million (roughly $2.7 million) and a nominal face value of AED 1 to 100 to begin operations. AED 40 million is the minimum capital required for a bank, while AED 25 million is required for insurance and investment companies.
Many companies can be run as Public Shareholding companies or Public Joint Stock Companies such as Insurance Companies, banks, corporate companies, etc. Also, foreign banks, insurance, or commercial companies can open a branch or representative offices in Dubai.
Prerequisites for setting up a public joint-stock company in Dubai include drafting a founders’ agreement, a prospectus, or a call for public subscription backed up by the results of an overall business plan or feasibility study and an auditor’s certificate.
How to Setup a PJSC in Dubai?
In Dubai, the processes to start a Public Joint Stock Company are as follows:
- Decide on a company name and logo.
- Get initial approval from the Department of Management Studies Dubai.
- Apply for a license by submitting the required documents
- Pay fees and obtain the business license
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What are the Documents Required for Public Shareholding Company Formation in Dubai?
- Business Activity Approval from UAE Government
- Prospectus of Invitation for Public Subscription
- Founder’s Agreement with Registration and Licensing Application
- Public shareholding approval from UAE Securities and Commodities Authority
- Resolution for Public Shareholding from the Ministry of Economy
- Due Diligence Survey
- Two copies of the Project’s Feasibility Study
- Four copies of the Memorandum and Articles of Association approved by Notary Public
- Photocopies of Office Space Contract and Registered Plot Number
- Written Declaration accepting the appointment of the Board of Managers and Directors
- Original Documents that contain the name of the Directors, Date, and Place of Birth, Occupation, and Sample Signature.
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