INVESTMENT HOLDING COMPANY in DIFC

What does the DIFC offer?

• 100 percent foreign ownership;
• zero percent tax rate on income and profits;
• the freedom to repatriate capital and profits without restrictions;
• operational facilities encompassing modern office accommodation, business continuity facilities, state of the art
technical support and data protection facilities, a low cost environment, and the availability of a skilled labour force
and highly trained professionals who can be easily outsourced in the region;
• an extensive tax treaty network for UAE incorporated entities;
• internationally accepted laws and regulatory processes;
• a world-class, independent, regulatory agency working alongside other financial regulatory agencies located in
major global jurisdictions;
• a wholly transparent operating environment, complying with global best practices;
• a dollar denominated environment;
• an international stock exchange with primary and secondary listings of debts and equity instruments; and
• a variety of legal vehicles that may be established with capital structuring flexibility.

DIFC licensees will not be subject to the relevant UAE or Dubai financial and banking legislation, except for the UAE
Central Bank's anti-money laundering regulations and the Federal Penal Code, imposed within the UAE, which also
extend to the DIFC.

The DIFC offers excellent options for establishing holding and proprietary investment companies.

What Can DIFC Holding/Proprietary Investment Companies Be Used For?

DIFC holding companies can be used to hold assets in the UAE and elsewhere. These assets include real property
(through JAFZA Offshore companies) and shares in other companies in the UAE and worldwide.

Proprietary investment companies can be used for the same purposes, the main difference being that a ‘holding
company’ activity can be obtained only when existing downstream investments already exist, or are in the final stages
of acquisition.

Such entities are also popularly used to attract investments, especially given the credibility of the DIFC as a well-
regulated jurisdiction and the comfort of familiarity with Common Law at the DIFC Courts.

What Is The Cost?

These structures are non-regulated, and hence do not come under the purview of the DFSA. The DIFC ROC is the body
that approves applications.

The first year costs at the DIFC are typically US$ 20,000, with annual costs coming in at US$ 12,000 subsequently.

A physical office space (at a business centre or dedicated space) will have to be availed as well.

Setting up a non-regulated entity is simpler than that of a regulated entity.

One can setup different types of legal structures including Limited Liability Company (LLC), Company Limited by
Shares (LTD), Limited Liability Partnership (LLP), General Partnership and Limited Partnership.

Consequent to the incorporation, the Share Capital of USD 50,000, which is the minimum capital requirement, will be
required to be deposited into the Company’s Bank account to formally allot the shares to the shareholder(s).
 Holding Company - Includes firms engaged in holding the securities of (or other equity interests
in )companies and enterprises for the purpose of owning a controlling interest or influencing the
management decisions of these firms. The holding companies in this industry do not administer,
oversee and mange other establishments of the company or enterprise whose securities they hold.

non-regulated companies in the DIFC will be able to operate as mainland

businesses within the emirate under a licence issued by Dubai Economy.

SETTING UP IN THE DIFC provides a secure and efficient platform for

businesses and financial institutions to reach into and out of the emerging markets of the region. The
quality and range of DIFC’s independent regulation, common law framework, supportive infrastructure
and its tax-friendly regime make it the perfect base to take advantage of the region’s rapidly growing
demand for financial and business services.

DIFC is a unique purpose-built financial free zone strategically seated at the heart of
Dubai. It provides resourceful policies for business and financial institutions reaching out
to developing markets of the region and beyond. It brings a solid ground for investment
because of its eminence and independent framework, with a common law structure and
tax-free jurisdiction. The DIFC Authority has entirely an autonomous directive. DIFC
plays a paramount role in meeting the rapidly growing demand for effective legal
framework for commercial and financial activities in the region.

In most cases, the DIFC does not require approval from Dubai Financial Service Authority
for such activities, mainly because the DFSA’s regulatory mandate only includes entities
involved asset management, banking and credit services, securities, collective
investment funds, custody and trust services, commodities futures trading, Islamic
finance, insurance, an international equities exchange, and an international
commodities derivatives exchange.