Registering a property in a company’s name. Dubai
– We should probably think about having – at least five properties under this company – to make it feasible for the max – Hi guys! – This is the second part with Marsel – We already had one video – where we discussed with him – how you can get a visa by opening a company in the UAE. – In this video, Marsel I want to ask you a few questions – about registering the property under the company’s name. – There are such requests from the clients – So let’s say if somebody comes to you – and ask this question, what would be your suggestions – and what are the fees related to this – and how long it will take to register such a company? – It’s a quite popular question. – And of course, there are several tools – and instruments on how you can reach the goal. – To us it all depends on the ultimate goals of the client. – There are some cheap solutions on registering – let’s say an offshore entity in the UAE. – There are two different jurisdictions – one of which is in Dubai, another is in Ras Al Khaimah – Further, register the property under the name of the company. – This is one of the most basic – and most budget options just for the purpose of holding those real estate assets. – If the goal of the client is to further make this property – or commercial use let’s say if they would ever rent it – and they want to accumulate some profits on a bank account – then, of course, we should consider about – the local resident company may be in the free zone – they would be able to open a bank account – and register the property at the same time so that – they do further management – and the profits would be managed – from that bank account. – So the first option that you said, – it’s to register the company even without the bank account. – It is possible, yes – and this will be cheap. – It’s a very rare option – I assume like many people who are buying – they’re considering to rent the property so … – But still, tell us what would be the price to just open the company – or just register some property under the cheap option? – Okay, the cheap option would start probably – from around between $3500 or $4000 – This will include the company incorporation phase – and the No Objection Certificate from that particular jurisdiction – to register the property under that entity. – Now if we consider the option in – for instance free zone in Dubai – the budget will be a lot higher – can reach out to $25 000 or $26 000 for a set up of the company – Let’s say the bank account – and then having the same no objections certificate – from the registry to just have that – property under the entity’s name – How long will it take to set up such a company? – Well again, I would probably tell you the average – and the maximum time. – The average time would take 4 working days – that’s for the cheap options – and if we’re talking about more complicated setup – to buy in free zones. – It may take up to one month. – I see and can another company, – which is not based in Dubai – can they own – the local company that is buying the property. – So let’s say there is a company somewhere in the Caribbean or British Virgin Islands – can they own a company over there – that will buy other properties? – Is it possible? – It is possible. – The only complication I see is – that any decision – any modifications to the company – it should be done on the level of that mother company – that holds the UAE company – and then the only inconvenience in all this model – is that the documents should be attested – by the ministries since – UAE didn’t sign a convention – and they do not accept the Apostille. – And there is one more thing that – I want to say from my side – as being an agent who is involved in the transactions – that the government over here – they will always ask to show who is the ultimate – the ultimate beneficiary of the company. – That’s correct. – So there could be a chain of companies – that own that property but the government over here will keep on asking – who are the ultimate beneficiaries – people who own the company – and in case if there will be any changes in the ownership – the Land Department over here will ask you – to pay the transfer fee. – Just to give you an example. – Let’s say we will not consider the chain of the company. – Let’s say Marsel and I own Or let’s say I own a company over here in Dubai – that owns a property, I just bought a property. – Before what was possible to do – I could come to Marsel and say – “Marsel, buy my company – and you will have the property as well.” – So you see now he owns the company – now he can get the rental money and stuff. – But this interaction wasn’t registered in the Land Department – so we didn’t pay 4% registration fees. – So right now the Land Department will ask – who was the owner in the beginning – and who is the owner now – And in case if they are different people – they will ask to pay the transfer fees. – So this is how it works – and it’s the same when there is a chain of the companies – and yeah, it might be a little bit complicated – but if you want us to clarify anything – you can find our numbers in the description – and we will answer these questions. – Marsel, what are some main mistakes in this part? – Like when people are opening the company to buy a property. – What do you see what is happening on the market? – We have a very fresh example – the practical example of what happened – A company held the property for last – let’s say five or six years – and it had a valid bank account at that time – since newly taken regulations and amendments – of the current policies in the bank’s – the banks started closing the accounts to a certain extent. – So this company was one of those – cases when they had their account closed – and they didn’t really oversee this situation. – and they entered into the deal with a potential buyer – and they signed the documents for sale – so now technically speaking the company being an owner – that has no valid bank accounts – but by the rules of the Land Department – the buyer should pay to the seller directly as its mentioned in the title deed. – Basically what will happen. – The company will have a cheque under the company name – which is not possible thing – But how can people protect themselves from such cases? – Well, the first protection is – we always recommend is to have as many bank accounts as possible. – That’s first of all. – So you cannot be based only on one bank account these days. – You need to have at least one alternative account as a spare option. – But let’s assume that this case ever happened – if you are in a situation when you hold the company – that holds the property in its turn. – It’s probably time to think on how to change the title deed. – So instead of your company, you need to put your name back again. – So these wouldn’t be classified as the sales and purchase – and it will be classified as the grant – Like a gift, we can say. – I think that’s the only option. – And how difficult is it to open a bank account for such company? – To be honest lately, it’s quite difficult – to open a bank account for any company. – What is the reason behind it? – Well, the reason is that the the banks – they are minimizing their own risks based on – different factors, let’s say the nationality factor or business model factor – That the people may enter into agreements with – sanction entities or sanction countries and other things so – it’s a multi-touch point approach – which is based on the risks. – Now if we position the case that – the company holds only the property – and it’s leasing only the property as the core business of the company. – This is not a bad idea – but we should think about the volume – the turnover of the funds that is routed from this account – because the local banks wouldn’t be literally interested – to open an account for a company – which holds only one property and generates – let’s say a hundred thousand AED or USD. – So if we position the case – purely as the property holding asset company – and that’s the core business – we should probably think about – having at least five properties under this company – to make it feasible for the banks – to oversee the volume of the funds – And let’s say if I am worried – that I might not get the bank account. – Is it possible for me to buy a company – with this existing bank account? – You may absolutely yes. – The thing is it’s not a very popular model in the UAE – for instance, if we compare the practice in BVI – or Seychelles or any of those small jurisdictions – when they have hundreds of shell companies ready for sale – it’s not the case in the UAE. – Yes, it is possible to find either an offshore company – or onshore company with the active bank account, – but then it’s we can say it’s not a usual case, – yes, you will have to be behind it – and look for options and ultimately you will find – The thing is that the prices would drastically differ – because if it’s ready business with ready bank account – probably budget can go up to three or four times more. – I see – And who will do the audit of the company? – to make sure that there is no debts – that the company has how does it work? – Is it you who are providing the service or somebody else? – We do provide such services – and in general, if we are looking – for available options, we actually rely on our sources – that we’ve checked through the past – and our experience. – Yes, of course we are preparing – the audit statements and a general report on the company – to state that there is no loan obligations – there are no contractual obligations – and that the company is fully solvent – Yes, only in that case – we are going ahead with the deal – just to make sure that both parties are satisfied and safe. – Guys, as you see there are a lot of different options – and a lot of hidden things in all of this – and obviously, the easiest way to discuss this – is to get in touch with Marsel. – I will leave his contact number and email – you can text him by the WhatsApp and send him an email – and Marsel will clarify these things – because once again a lot of different options – and there are different cases – and we cannot say that there is one right solution – Right, there is no perfect formula, – you know it always depends. – Okay, Marsel, thank you once again so much – for your time. – It was a pleasure. – Guys, please leave your questions – in the comments under this video – maybe from time to time – Marsel will come and answer them – in the comments on YouTube. – Thank you, – and we’ll see you in the next video. – Goodbye!