Business Setup in Ajman Mainland

Ajman Mainland is an attractive destination for foreign investors who want to set up a cost-effective business in the UAE. It is strategically located on the Arabian Gulf Coast near Umm Al Quwain and Sharjah, offering easy access to regional and international markets. The emirate is known for its streamlined registration process, low setup costs, and dynamic and investment-friendly environment provided by the Department of Economic Development in Ajman. With flexible leasing options and a growing economy, entrepreneurs can set up businesses rooted in popular industries such as real estate, construction, retail, transport, and consultancy services. In this article, you will learn about the business setup in Ajman Mainland with detailed information.

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Ajman Mainland - A Brief Overview

Ajman Mainland companies operate in commercialised geographic regions and are directly registered under the Emirates government through the Department of Economic Development in Ajman. These companies can conduct business anywhere in the UAE and internationally without restrictions. Unlike free zone entities, mainland businesses can trade directly with the local market and take on government projects. With no limitations on business activities and access to a broader customer base, Ajman Mainland provides entrepreneurs with greater flexibility and growth opportunities in a competitive business landscape.

Benefits of Ajman Mainland Business Setup

Below, we have given several benefits that entrepreneurs can attain by setting up a business in Ajman Mainland:

• 100% Foreign Ownership in Specific Activities: Investors can fully own businesses in selected sectors, enhancing control and profitability.
• Low Corporate Tax: Ajman offers one of the most convenient corporate tax structures, making it an attractive business hub.
• Zero Personal Tax: Entrepreneurs and employees benefit from tax-free personal income, increasing overall earnings.
• Robust Infrastructure: The emirate provides well-developed facilities, including modern roads, utilities, and telecommunication networks.
• Excellent Connectivity: Businesses benefit from seamless access via seaports, international airports, and well-connected highways.
• Strategic Location: Situated near major UAE emirates, Ajman serves as a gateway to regional and global markets.
• Low-Cost Living: Affordable housing, utilities, and everyday expenses make it easier for businesses and employees to thrive.
• Cost-Effective Foreign Labor: Employers can hire skilled and unskilled workers at competitive wages, reducing operational costs.
• Affordable Office Spaces and Warehouses: Ajman Mainland offers commercial properties at lower rental rates, making it ideal for startups and expanding businesses.

Types of Ajman Mainland License

Ajman Mainland offers various business licenses to accommodate different industries and activities. Here are the main types:

Professional License 

The professional license is issued by the Ajman DED, which allows skilled professionals to provide services such as accounting, management consultancy, and technical support. It is ideal for individuals and firms offering expertise-based services.

Industrial License 

Industrial license is designed for companies involved in manufacturing and production. It permits businesses to import raw materials, manufacture goods, and export finished products. To qualify, companies must be GCC-registered, with subsidiaries requiring 51% GCC ownership.

Trading License

Trading license is suitable for businesses engaged in buying and selling goods within the UAE and internationally. This license covers import, export, and re-export activities. Businesses can opt for a general trading license (covering multiple goods) or a specific trading license (restricted to particular products).

Service License

The service license is required for businesses offering specialized services such as consulting, education, legal, or engineering services. This license allows 100% foreign ownership, but a Local Service Agent (LSA) is required to handle regulatory requirements without holding ownership rights.

E-Commerce License

With the rise of online shopping in the UAE, e-commerce licenses have become essential. This license enables businesses to sell goods and services online, manage imports and exports, and leverage Ajman’s strategic location near major logistics hubs.

Business Structure Allowed in Ajman Mainland

Selecting the right business structure is crucial in setting up a company in Ajman Mainland. The legal structure depends on the number of shareholders and the nature of the business. Here are the business structures that are permitted in Ajman Mainland:

• Sole Proprietorship: Owned and operated by a single shareholder, this structure grants full control but also imposes unlimited liability on the owner. UAE nationals and foreigners can establish a sole proprietorship, but foreign investors must appoint a UAE national as a Local Service Agent (LSA). This structure is ideal for professionals offering services.
• Limited Liability Company (LLC): Suitable for businesses with 2 to 50 shareholders, an LLC protects shareholders by limiting their liability to their investment in the company. Since June 2021, the 51% local sponsor requirement has been removed for nearly a thousand commercial activities. LLCs can engage in commercial and industrial activities but not consultancy services.
• Private Joint Stock Company (PJSC): Requires at least 51% UAE national ownership, with foreign investors permitted to participate in various commercial, industrial, and some professional activities. PJSCs are suitable for businesses planning to raise capital from multiple investors.
• Civil Company: Formed by at least two individuals, a Civil Company allows professional partnerships but requires a UAE national as a service agent or partner. This structure is commonly used for consultancy and professional service businesses.

Documents required to Setup a Business in Ajman Mainland

Setting up a business in Ajman Mainland requires submitting specific documents to the authorities. Below is a list of essential documents needed for the registration process:

• Passport Copies: Valid copies of passports for all shareholders and partners.
• Passport-Sized Photographs: Two recent passport-sized photos with a white background for each shareholder.
• Proof of Residential Address: Shareholders must provide proof of address from their country of residence.
• Emirates ID: Mandatory for UAE residents; non-residents are not required to submit this.
• Visa Copy: Shareholders or partners residing in the UAE must submit a copy of their residence visa.
• Trade Name Approval Certificate: A certificate issued by the Department of Economic Development (DED) confirming the approval of the business name.
• Initial Approval: A document granting permission from authorities to proceed with the business setup.
• Lease Agreement: A signed and attested lease agreement for a physical office space, as law requires.
• Memorandum of Association (MOA): A notarised document outlining ownership structure and shareholder responsibilities for LLCs.
• Additional Approvals: Businesses in regulated sectors like healthcare, education, or legal services may require further approvals from relevant authorities.

Procedure for Business Setup in Ajman Mainland

Setting up a business in Ajman Mainland requires following a structured process to ensure compliance with regulatory requirements. Below is a step-by-step guide:

Step 1: Choose a Business Activity

Identify the type of business activity you plan to undertake, as it determines the required license. Ajman Mainland allows various activities, including trading, services, manufacturing, and consultancy.

Step 2: Select a Legal Structure

Choose an appropriate legal structure, such as a Limited Liability Company (LLC), Sole Establishment, or Branch Office. This decision impacts ownership rights, liability, and legal obligations.

Step 3: Reserve a Trade Name

Submit an application to the Department of Economic Development (DED) in Ajman to reserve a unique trade name. The chosen name must adhere to UAE naming guidelines and avoid offensive or religious terms.

Step 4: Obtain Initial Approvals

Secure initial approvals from the DED and other relevant regulatory bodies, depending on your business activity. Approvals may be required from health, environmental, or industry-specific authorities.

Step 5: Lease a Physical Office Space

Ajman Mainland businesses must lease or own office space to meet licensing requirements. The leased premises must receive approval from the municipality.

Step 6: Draft and Notarize the MOA

For LLCs, draft and notarise a Memorandum of Association (MOA) that outlines shareholder roles, ownership distribution, and company structure.

Step 7: Submit Final Documentation

Submit all necessary documents to the DED, including trade name approval certificate, initial approval certificate, lease agreement, MOA, etc.

Step 8: Pay License Fees

Once the DED approves the application, pay the applicable license fees based on the business activity and type of license.

Step 9: Obtain the Business License

After completing the process and making the required payments, the business license is issued, allowing the company to operate legally in Ajman Mainland.

Step 10: Open a Corporate Bank Account

With the business license in hand, open a corporate bank account in a UAE-based bank to facilitate financial transactions.

Step 11: Apply for Visas

Apply for residence visas for shareholders, employees, and dependents. The number of visas granted depends on the size of the leased office space.

Cost of Setting of Business in Ajman Mainland

The cost of setting up a business in Ajman Mainland varies depending on factors such as the type of license, legal structure, office space requirements, and government fees. On average, business setup costs include trade license fees, registration fees with the Ajman Department of Economic Development (DED), office lease expenses, notarisation of legal documents like the Memorandum of Association (MOA), and visa fees for shareholders and employees. Additional costs may apply for industry-specific approvals or special permits.

Compliance Requirements for Ajman Mainland Businesses

The following are the legal compliance requirements need to be met for Ajman Mainland Businesses:

• Physical Office Space: Ajman Mainland businesses are required to maintain a physical office, which must be verified and approved by the municipality to ensure legal operation.
• Local Sponsor Requirement: For commercial and trading businesses, a local UAE sponsor must hold 51% ownership. However, the sponsor does not have direct control over business operations.
• Compliance with Laws: Companies must adhere to UAE labor laws, ensuring fair hiring practices, proper employee benefits, and compliance with end-of-service gratuity regulations.
• Memorandum of Association: Limited Liability Companies (LLCs) must draft and notarize a Memorandum of Association (MOA), which outlines ownership distribution, partner roles, and business regulations.
• Ultimate Beneficial Ownership (UBO): Businesses must disclose their ultimate beneficial owner (UBO) to maintain transparency and prevent financial misconduct or illegal activities.
• Anti-Money Laundering (AML) Compliance: Companies must comply with UAE’s Anti-Money Laundering (AML) regulations to prevent illicit financial activities and ensure ethical business operations.

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