Types of companies according to the UAE Companies Law
A company is defined as a contract whereby two or more persons commit to the participation of each of them
In the establishment of an economic project with the aim of profit, and this is according to the UAE law within Article 8 of the Commercial Companies Law No. 2 of 2015. This law, which contributed to the development of the business environment, the state’s economic position, and its capabilities, helped to regulate private companies with everything related to the regulation of governance rules, and the protection of The rights of each of the partners, shareholders, investment support, strengthening of responsibility, and limiting in Article 9 of it 5 legal forms of companies in the United Arab Emirates.
Legal types of commercial companies in UAE law
Every commercial company that does not fall within the following legal types is considered void, as the types of companies according to the UAE Companies Law are as follows:
1. Solidarity Company.
2. The recommendation company is simple.
3. The public shareholding company.
4. The private joint stock company.
5. Limited Liability Company.
Types of companies according to the UAE Companies Law
Tad Hamon Company
Article No. 39 of Chapter One of the Companies Law defines that a joint liability company is a company that consists of two or more partners, and it is called a partnership because the partners’ responsibilities are joint in all of their money in relation to the company’s obligations. Partners, and the name may be limited to mentioning the name of one or more partners, with the addition of evidence of the presence of words indicative of partnership, such as the word (and partners), and (joint liability company) is written at the end of the sentence.
Each partner in a partnership company is considered a merchant, and the company’s bankruptcy leads to the bankruptcy of all partners.
Article No. 53 of the Companies Law also specified that the joint liability company shall be liable towards third parties and compensation for damages resulting from the actions of one of the partners that take place with the consent of the rest of the partners, or when starting to carry out the usual business of the company.
Simple Recommendation Company
A simple partnership company consists of one or more general partners who are responsible for the company’s obligations, and another partner called a trustee who is not responsible for the company’s obligations except according to his share in the capital, and all the joint partners in it must be Emirati citizens.
The company’s name consists of one or more names of the general partners, with evidence of the company’s existence, and it may not have a special trade name, and the silent partner may not interfere in the management business related to others.
Article 65 of the Companies Law also specified that the contract of a limited partnership company must include a statement referring to the general and limited partners.
Decisions are issued by the company unanimously by the opinions of all partners, whether they are joint or limited partners, unless the contract contains the majority opinion and the silent partner is responsible for the violations he has committed.
Public shareholding company
Under Article 105, a public joint stock company is defined as a company that consists of 5 people, or more. The federal government, the local government, or any state-owned company may establish a public joint stock company, and it is defined as every company with a capital divided into shares of equal value that can be exchanged. For trading, the partner is asked only for the amount of his share in the capital.
According to the UAE Companies Law, the capital of this type of company may not be less than 30 million dirhams, and the responsibility of each partner is according to his contribution to the capital. The number of members of the board of directors of a public shareholding company should not be more than 3 people, and not more than 11 members.
Private Joint Stock Company
According to what was stated in Chapter 5, Article 255, a private joint stock company is a company whose number of shareholders is not less than two and not more than 200. One legal person may establish and own a private joint stock company, and the owner of the company’s capital is not responsible for its obligations except to the extent of the capital contained in the contract. incorporation.
The name of the company must include the phrase “One Person Company (Private Joint Stock Company”) and its shares are not offered for public subscription, and the subscription must take place with the full capital, which must not be less than 5 million dirhams, and the private joint stock company may be converted into a public one.
Limited Liability Companies
The text of the first chapter in the law of establishing limited liability companies in Article No. 71, and it is defined as a limited liability company, which is where the number of partners is not less than 2 and not more than 50 partners, and each of them is only responsible for the amount of his share in the capital.
The capital shall come from shares of equal value, and profits and losses shall be distributed according to the ratios agreed upon by the partners, and it is not required that they be equal with the shares of the capital. The Companies Law in the UAE stated that if the number of partners exceeds 7 people, they must appoint a supervisory board and be made up of at least 3 partners, and the company’s contract may not be amended, or increased or reduced, except after the approval of a number of partners representing 3 quarters. The capital, unless the contract stipulates otherwise.