Setting up a business in Dubai

There are six legal procedures which have to be fulfilled for every individual who seek to start a business in Dubai which lasts a week or eight days. Below are some required components which are as follows,

1- Name of Company: Your trade name being an important component must clearly indicate the company’s nature of business unless a branch of company.

2- Type of Business: The type of your business will determine the kind of license you require may it be professional, industrial or commercial. Furthermore you need to get higher authority approvals for legal consultantcy and more

3- Local Partner: It is required to have a local partner for DED license which is a good support for expats however it is not mandatory.

4- Owning the Company: As an expat, to get 100% ownership of your company, you will have to choose one of the free zones in UAE. Each free zone is unique catering to specific kind of activities.
For local ownership you need to get a license from Department of Economic Development (DED), however there are certain restrictions on share of ownership.

5- Legal Formation: There are some rules on forming a company that is based on the type of business and location. Furthermore there are restrictions for companies relating to company structure in each freezone.
For example to open a law firm in UAE, it has to be a branch of a company or a stand-alone company and not a sole proprietor.

6- Minimum Share Capital: The memorandum of association has to mention minimum share capital for the upcoming company, while setting up a company you don’t need to pay in most cases.

7- Office Premises: It would be best now to shortlist few offices on the basis of rent, area and location. You may select a free zone as well to get assistance on selection of a suitable place.

8- Hiring Employees: While setting up a business you may need to hire a manager to get your registration approved and in most cases like Intelaq license holders, they cannot hire staff but are able to hire contractors.

When does an Arrest of an Individual happen in UAE

An expat living in UAE or a tourist must know the national law of the UAE to avoid being arrested or hand cuffed even if the committed crime was not intentional.

The following consists of a list of offences which an individual must be aware of:

a- Using offensive/vulgar language or making rude gestures can render an individual liable of a criminal offence.

b- Adultery which implies having an affair outside marriage with your married partner is an offence.

c- Display of affection such as cuddling or kissing.

d- Tourist couples who are unmarried are strictly not entitled to book a single hotel room.

e- It is not allowed to drink in public or unlicensed venue due to sharia law but you may drink in pubs, clubs and bars (licensed venues)

f- Like all other countries bringing drugs to UAE is unlawful and using or selling is also an offence and can get you a jail sentence for a minimum of four years or even death penalty in some circumstances

g- Charity fundraising without government approval can get you in trouble for doing good due to strict fundraising laws

h- Don’t even think of posting anything that is anti UAE or antigovernment on social media as this can get you in trouble

i- Public protests are not likened by the UAE government and to prevent them the government can arrest you and put you in jail

j- Any kind of racist, insulting or sending derogatory text messages can get arrested and jailed

Tenancy Obligations in Dubai

There are some obligations for the tenant that he or she must fulfill to avoid any legal charges against them which are as follows,

a- No changes can be made to the property by the tenant prior to landlord and higher authorities approval

b- There is a requirement to pay certain amount of deposit to the landlord which will be returned once the tenancy contract expires

c- Rent has to be paid on due date or else legal action would be taken against the tenant

d- Maintaining the property in a manner as any ordinary individual would take care of his own property

e- As per the rule the tenant may not remove the leasehold improvements made by the tenant

f- Without the written consent of the landlord, the tenant cannot invite someone for the use or sub lease the property to third party

g- The tenant must hand over the property the same means the condition should not deteriorate except ordinary wear and tear

h- If not stated in the contract the tenant has to pay fees and taxes for the use of property or for sub lease

Tenancy and Landlord rights in Dubai

As an expat living in Dubai requires that you should familiarize yourself with tenancy rules and regulations which of course include the tenancy contract. Following are the rights of the tenants,

a- No changes are to be made by the landlord to the amenities or annexes of the property preventing its full use
b- Any decoration work or any other such work that requires approval from the authorities must be given to the tenant provided that does not affect the structure
c- The landlord is bound by law to give the house in good livable condition which is not bad allowing its full use
d- All the repairing and maintenance is to be done by the landlord and not the tenant during the term of the contract without affecting tenant’s usage
e- Rent can only be increased as per RERA rental bracket for contract renewal for different areas and properties
f- For any reason the landlord is not allowed to withhold the security deposit if done so then tenant can file complain to rent dispute committee
g- Disconnection of services to the property by landlord is not allowed if such incidence happens then tenant can complain to the police or the rent dispute committee for compensation

Please note that the contract can only be terminated with the mutual consent of both parties.

Bounced Cheque in UAE

A bounced cheque is considered a crime in UAE and as per new rules instead of jail term there will be fines issued considering bounced cheque as a misdemeanor on the following basis,

– There is no date mentioned
– It is not signed by the drawer
– Does not clearly state the word “cheque”
– Does not specify the amount issued
– If it does not mention drawer and the beneficiary name

The new rule states that a bounced cheque of upto 50,000 will be given a fine of aed 2,000, for cheque between 50,000 to 100,000 will be given a fine of aed 5,000 and lastly for cheque between 100,000 to 200,000 will be given aed 10,000 fine.

A postdated cheque is not considered a crime. However, the cheque will be invalid if the date is not incorporated on the cheque or it contains fake duplicate signature or any sort of mark.

Please note that a bounced cheque crime may not be intentional but still the offence takes place once the cheque has been presented

Extradition request in the UAE

1- The law governing the extradition process is under Federal law No. 39 (2006) which is about International Judicial Cooperation in Criminal matters
2- Anyone residing in UAE can make an extradition request against the accused or the person who has committed a crime.
3- To process the request of extradition, a treaty has to be signed between UAE and the country of extradition and the provisions of such treaties may include additional requirements
4- For the extradition to be considered in the UAE, the offence should also be considered a crime in the country of the accused.
5- If the offence of the accused relates to execution of custody, then the custody should be no less than six months for extradition
6- Interpol is the body through which a request can be made against the accused.
7- The severity of the crime will decide the type of notice to be issued. For serious offences and crime the red notice is given to the accused.
8- Notices issued by Interpol are official and has an international effect and the accused can be held under custody.
9- If the crime in the UAE is under a different name, description or has other components then the extradition country, it will not be considered the same

Preparing Power of Attorney in UAE

The power of attorney is to be prepared by the law firm and then sent for translation into Arabic and English.

In order for a lawyer to act on behalf a client, it is obligatory for the client to authorize the lawyer of doing so by signing a power of attorney. This will show that the lawyer acting on behalf of the client has full authority to represent the client in all legal matters. It needs to be stamped and attested by the Dubai courts.

The power of attorney will be revoked once it completes its time frame or at the death of the person giving the power or even at the will of the executor by written application, however this is only possible in Abu Dhabi and Sharjah

To use power of attorney made somewhere other than UAE, the following must be done,

a- Translate documents into Arabic
b- Attestation by the foreign office in UAE
c- Legalize documents by UAE Ministry of Justice
d- Signing power of attorney in front of notary in the country of issue
e- Attestation by the foreign office in country of issue
f- Legalize documents by UAE Embassy in country of issue

Revoking the Bail in UAE

There is a fair possibility of the bail given to the client be revoked as per article 115 of criminal procedures law under the following circumstances which are:

1. If the accused has been absent to a hearing in court, in which case there is a breach of order which can lead to cancellation of the bail.

2. The person giving surety for the bail of the accused may be revoked if that person withdraws

For these two above mentioned reasons, it is necessary to seek help from a lawyer from the beginning till the end to help you bail out, to understand and not be in contradiction of the laws intentionally or unintentionally.

Furthermore to revoke the bail an application can be submitted explaining the incident of the case.

Please note as per article 117 of the UAE law the victim of the crime cannot request imprisonment for the accused or involve in any discussion in regards to bail

Bail in the UAE

Bail is the procedure of giving temporary release to the person accused of the crime on deposit of some guarantee to the court.

The UAE bail procedure is the same as everywhere with no change in definition and has the same importance for the clients that is to get their members out on bail as soon as possible.

For being charged with minor crime public prosecution has the right to release the accused on bail but for serious crimes like murder or robbery where verdict is a death penalty or jail sentence for life then only bail or release is not applicable as per article 111 of UAE criminal procedures law.

The temporary release of the accused on bail requires that he or she provides some guarantee to confirm their appearance in the court proceedings. The guarantee may involve retaining the passport of the accused or their family members and friends. Furthermore money can also be deposited in the courts as a guarantee or a solvent person can be the guarantee as well for a certain amount to be paid if the accused violates the bail provisions.

The violation of bail provisions can lead to takeover of the guarantee by the government before the final verdict, similarly if the case has ended; the guarantee given by the accused will be returned in full and also will be released from any undertaking.

Franchise Dispute & Arbitration Advantages in UAE

Arbitration is an alternate dispute resolution whereby the parties recourse to a private court with nominated judges known as arbitrators.

It is widely used all over the world for resolving international disputes such as franchise due to their nature being neutral and unbiased.

The basis of its neutrality is all dependent on the selection of the arbitrator which is done so with the consent of both parties. It is flexible too with time, place and procedures even in some cases giving judgment on the basis of documents alone without summoning parties or their lawyers.

The court proceedings carried out by state courts are public whereas in arbitration there is privacy and confidentiality.

Furthermore verification of enforcement of the court judgments or the arbitral award is of prime importance prior to dispute resolution due to the fact that court judgment is not recognized in some countries where as arbitral award under New York convention is recognized and can be enforced internationally within 156 countries of New York convention.

The clauses under arbitration are to be enforced as written to avoid waste of money and time of both the parties.