Every successful business journey evolves, and sometimes, that journey includes welcoming a new partner on board. Whether it’s to leverage fresh expertise, boost capital, or share responsibilities, adding a partner to your trade license in Dubai can be pivotal for growth.
The process might seem procedural, but with the right guidance, it’s an opportunity to streamline your operations and strengthen your foundation for success.
In this article, we’ll walk you through the required steps and documents and discuss the benefits of expanding your business through partnerships.
The process of adding a partner to a trade license
- Identify the new partner
Before taking any formal steps, you need to decide who will join your business. Whether an individual or a corporate entity, selecting a partner based on their expertise, resources, or market connections is crucial.
- Draft or update the shareholder agreement
Next, create or revise a shareholder agreement that outlines the roles, responsibilities, and rights of each partner. This should detail contributions, profit-sharing terms, and dispute-resolution mechanisms. Working with legal or corporate advisors ensures the agreement meets legal standards.
- Secure existing partner approvals
For LLCs or other partnership structures, existing partners must approve the addition of new ones. This involves updating the company’s Articles of Association to reflect the new partnership dynamics.
- Gather required documentation
Each new partner must provide the following:
- A valid passport copy
- Emirates ID (if applicable)
- A No Objection Certificate (NOC) from their current sponsor (if they reside in the UAE)
- For corporate partners: Commercial license, Certificate of Incorporation, and board resolutions approving the partnership
- Submit the application
Once documentation is complete, submit your application to the Dubai Department of Economic Development (DED) through their online portal or a service centre. Pay the applicable fees and await approval.
- Update the trade license
After approval, the trade licence is amended to reflect the new partnership. You’ll need to inform relevant authorities, such as the Ministry of Human Resources and Emiratisation (MOHRE) or the Federal Tax Authority (FTA) to ensure compliance.
Documents required to add a partner to a trade licence
For individual partners
- Valid passport copy
A clear, up-to-date passport copy of the new partner is mandatory. - Visa and Emirates ID (If residing in UAE)
If the partner is already in the UAE, their residency visa and Emirates ID must be submitted. - No Objection Certificate (NOC)
A NOC from the current sponsor is needed if the individual partner is sponsored under a different company or employer within the UAE.
For corporate partners
- Commercial licence or certificate of incorporation
The corporate partner must provide a valid trade license or incorporation certificate as proof of their legal entity. - Board resolution approving the partnership
A notarised and attested resolution from the company’s board of directors explicitly approving the new partnership. - Memorandum and Articles of Association (MOA)
A copy of the company’s MOA to verify its scope of operations and the authority to enter into partnerships.
General documents
- Updated shareholder agreement
This document outlines the roles, responsibilities, and profit-sharing terms of all partners, including the new addition. - Amended Articles of Association (If applicable)
Reflecting the inclusion of the new partner, this document must be updated and notarised. - Proof of paid-up share capital
A letter from the bank showing the updated share capital, especially if the new partner’s inclusion involves capital contribution. - Registry Identification Code Form (RICC or RIC)
For both individual and corporate partners, this form identifies the new partner in official records.
By ensuring all documents are complete and accurate, the process of adding a partner can proceed smoothly without delays. Always double-check requirements with the relevant authority or engage a corporate service provider for assistance.
Types of business partnerships in Dubai
Dubai offers various partnership structures to suit different business needs. Here’s a quick overview of the main options:
- Sole Proprietorship: Ideal for professionals and small businesses, this structure allows complete control but comes with full personal liability.
- Limited Liability Company (LLC): A popular choice for mainland businesses, LLCs can have 2-50 shareholders, with liability limited to their shares. Recent reforms now allow 100% foreign ownership in specific sectors, making it ideal for trading, manufacturing, or service-oriented ventures.
- Joint Venture: Perfect for project-based collaborations, joint ventures combine resources and expertise. One partner typically handles licensing and legal responsibilities, making it common in sectors like real estate and construction.
- Professional Partnership: Designed for professionals like consultants, lawyers, and doctors, this setup allows partners to jointly offer services while sharing liabilities based on their roles.
- Free Zone Partnerships: While free zones offer 100% foreign ownership, partnerships are still helpful for alliances or resource sharing. This structure suits companies looking to expand within a tax-free environment.
Benefits of adding a partner to your trade license
- Shared responsibilities: A partner can share the workload, letting you focus on your strengths while they handle other key tasks.
- Additional resources: Partners bring more than capital—they often offer skills, industry expertise, and valuable networks to enhance your business capabilities.
- Better decision-making: Fresh perspectives and alternative strategies from a partner can help you make smarter business decisions and seize new opportunities.
- Faster growth: With combined efforts, scaling operations, entering new markets, or expanding services becomes more achievable.
- Risk sharing: Splitting risks reduces financial pressure and ensures a collaborative approach to tackling challenges.
- Stronger market position: A partner with local knowledge or industry connections can give you a competitive edge in Dubai’s business environment.
About Worldwide Formation
When it comes to business setup in Dubai, experience and precision make all the difference. Established in 2008, Worldwide Formation has become a trusted partner for over 10,000 clients from 90 countries, offering expert guidance in navigating the UAE’s business landscape.
As an official agent for all major UAE jurisdictions, we specialise in free zone, mainland, and offshore company formation. Beyond incorporation, we provide end-to-end support, including visa services, corporate bank account assistance, tax compliance, and a range of other essential B2B solutions.
Our commitment is simple: deliver customised, seamless solutions tailored to your business’s unique needs, ensuring your success in the UAE and beyond.
Ready to take the next step? Contact Worldwide Formation today, and let our team of experts simplify the process of establishing and growing your business in the UAE.
