RAK Offshore & Free-Zone STEP Zurich 23 September 2009

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1 UAE Map of the UAE RAK Offshore & Free-Zone STEP Zurich 23 September 2009 In partnership with : Bahram Khadavi Managing Director Europe - TEP About RAKCA One of the UAE leading Corporate Service providers Established in 2006 Privately owned by a diversified Group First and largest Registered Agent for Offshore companies with the RAK Investment Authority Headquartered in Ras Al Khaimah with representation in Dubai & Geneva RAK CA is an ISO 9001 Certified Company (Quality Management) Offers Corporate Services like: Incorporation of onshore/offshore companies Management of onshore/offshore companies Administration of onshore/offshore companies Business Advisory Services: Business Centre & Virtual Office Accounting & Book Keeping Re-location

2 About RAKCA Two key concepts : 1) Offshore Companies (IBCs) Based on the BVI model, no physical presence required 2) Onshore (or Free Zone) Companies Physical presence required, licence and visa No taxation Introduction RAS AL KHAIMAH (RAK) Emirate of the UAE since 1972 IBC concept launched in 2007 International Business Company Regulations 2006 English Language Regulations

3 Uniqueness UAE is not a dependent or overseas territory of another country UAE has Double Taxation Avoidance Agreements (DTAA) with 47 countries UAE is not a member of the Organization for Economic Cooperation and Development (OECD) UAE is not on the OECD black or grey list of tax havens UAE is a member of the Middle East & North Africa Financial Action Task Force (MENAFATF Organization against money laundering and terrorist financing Features Set-up time : 24 hours It may have corporate shareholder/corporate director It may have non UAE resident as director or shareholder It does not require the shareholder/director to be physically present in the UAE for incorporation It is not obliged the maintain its books and records It does not need to have physical offices in the UAE Re-domiciliation / Continuation from other Offshore Jurisdictions permitted, subject to the approval of RAK Registrar

4 Features It may own real estate in and outside the UAE, with prior authorization from the RAK Investment Authority It may maintain bank accounts and deposits in the UAE or worldwide It may hold shares in other UAE and worldwide companies Straightforward winding up provisions However, a RAK Offshore company may not : carry on business within the UAE obtain UAE residency visa for its directors/shareholders do banking and insurance business without special license Share Capital No minimum paid up share capital No bearer shares Shareholders named in Memorandum Share transfers : Written instruments submitted to Registrar Share certificates notarized by Registrar

5 Directors Sole director permissible Corporate directors permitted No residency/nationality requirements NB: Directors may be named in the Memorandum (through attested Registery of Directors) Main Activities General Trading Consulting and Advisory Services Holding Company (Buy/Hold/Sell stakes of companies) Investments & Joint Investments Company Property Owning International Services Professional Services Shipping and Ship Management Companies Commission Agents Company Intermediary Brokers (IB s)

6 Tax 100% income tax exemption 100% corporate tax exemption 100% capital and profit repatriation 100% foreign ownership allowed No Import or Export taxes No Capital Gains tax No Value-added tax No Withholding tax Double Taxation Avoidance Agreement with 47 countries What is the purpose of a double tax treaty? to avoid double taxation to obtain reductions in withholding tax in overseas territory to achieve certainty of tax treatment to prevent fiscal evasion UAE Ministry of Finance issues Tax Residency Certificate for RAK Offshore Companies (conditions may apply)

7 Documents Individual Shareholder/Director Clear Copy Passport Bank Reference Letter (in original) Utility Bill/Proof of Residential Address (in original) Application Form (in original) Payment 24 hours set up time Documents Incorporation documents include: Memorandum and Articles of Associations Provisions for Registered Agent and Registered Address Share Certificate Minutes of Subscribers Meeting Company Seal

8 Additional Services Nominee Director Services Nominee Shareholder Services Administration and Secretarial Services Business Centre & Virtual Office Services Financial Intermediaries Banks Financial Intermediaries Asset Managers Family Offices Chartered Accountants Tax Advisers Lawyers, etc. are Clients of RAKCA Institutional Division RAKCA offers unparalleled services and conditions to its financial intermediaries clients

9 UAE FREE ZONE Introduction Set-up time: 5 working days Offers 100% ownership with no involvement of local partner or sponsor in a tax-free environment Offers UAE Residency Visa Provides various types of business licenses (Trading & Commercial, Industrial, Consulting, Media) Availability of various sizes of offices and warehousing requirements UAE FREE ZONE Type of entity A UAE Free Zone Company can be established in the following ways: A branch of an existing company Foreign Branch A foreign affiliate that is legally a part of a firm residing outside of the UAE Local Branch A domestic affiliate that is legally a part of a firm residing in the UAE A new establishment Free Zone Company A new business entity which is owned by 2 5 partners Free Zone Establishment A new business entity with a sole business owner

10 UAE FREE ZONE Features 100% foreign ownership No corporate taxation for 50 years a concession that's renewable Freedom to repatriate capital and income in totality No personal income tax Full exemption from import duties No currency restrictions No bureaucratic red-tape No recruitment problems Modern efficient communication State of the art infrastructure Abundant energy Attractive working environment Owned premises on leased land can be mortgaged UAE FREE ZONE Features It needs to have physical offices in the UAE It may carry on business within the UAE It may obtain UAE Residency Visa It can have non UAE resident as director or shareholder It may own real estate in the UAE & worldwide It may maintain bank accounts and deposits in the UAE & worldwide It is obliged to maintain its books and records It may hold shares in other UAE & worldwide companies

11 UAE FREE ZONE Double Taxation Avoidance Agreement UAE has Double Taxation Avoidance Agreements (DTAA) with a number of countries Double taxation agreements prevent individuals and corporations from being susceptible to paying tax on the same item during the same time period. These agreements determine which of the two states concerned should levy tax in a particular situation: Austria, Belarus, Belgium, Canada, China, Czech Rep., Egypt, Finland, France, Germany, India, Indonesia, Italy, South-Korea, Lebanon, Luxembourg, Malaysia, Malta, Mauritius, Morocco, New Zealand, Netherlands, Pakistan, Poland, Romania, Seychelles, Singapore, Spain, Sudan, Thailand, Tunisia, Turkey, Ukraine among others UAE Ministry of Finance issues UAE Tax Certificates for UAE Free Zone upon request

12 UAE FREE ZONE Documents Application form duly filled Application for License Passport copies of partners Passport copy of manager Original bank reference letters of partners (Good Standing Letter) License copy of existing company (if any) Original bank reference letter of existing company (if any) UAE FREE ZONE Price Set up fees depending on type of license Office Rent/year (shared desk) Shareholder Capital Set up time with residence visa: 3 weeks

13 We hope you enjoyed our presentation Contact details: Q & A Mr. Bahram KHADAVI Managing Director Europe - TEP RAKCA FZ LLC / RAKCA Suisse SA Rue de Rive Geneva bk@rakca.com