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A Public Listed Company (PLC) in the Dubai Free Zone is a legal limited liability entity operating in the different free zones under the specific free zone authorities. It has 2-50 shareholders, who may be a natural or juristic person per the specific free zone authorities. For example, a PLC is an entity with two or more shareholders having a legal personality distinct from its shareholders and holds the capacity, rights, and privileges of a person in the Jebel Ali Free Zone as per the Registrars Company Regulations in the United Arab Emirates.
As an independent legal entity of the free zone, it also offers limited liability protection as per Article 71 of Federal Decree-Law No. 32 of 2021 of the UAE Commercial Companies Law. However, Unlike other free zone entities, it can offer shares to the public and trade on stock exchanges as per the Jebel Ali Free Zone official website. The operational framework of a PLC entity is set by the respective Free Zone Authorities (FZAs), which further abide by the laws of government bodies.
Just like other free zone companies PLC offers several benefits. One of the most appealing aspects for investors is the buying and selling of shares in the public market, according to the JAFZ official portal. Along with this, it offers 100% foreign ownership according to Free Zone Regulations empowering foreign investors to perform business activities without relying on a local sponsor.
Setting up a publicly listed Company (PLC) requires meeting specific criteria and following essential steps. The steps can vary from one free zone to another. However to start through any of the free zone platforms you have to follow some common steps. This includes selecting your license type, and making the necessary payment for the business setup process, ensuring compliance with the UAE Department of Economy Development’s Business Activity List. The detailed process is discussed below in this article.
For PLC setup, you can work with our experienced team to explore valuable solutions. Felix Happich Consultancy provides multiple options to support business growth and create an appropriate business environment as per your needs.
What is a Public Listed Company (PLC) in Dubai?
A Public Listed Company (PLC), or Public Joint-Stock Company, is a legal business entity with limited liability in the Dubai Free Zone that allows investors to offer shares to the public and trade on stock exchanges. It has a legal identity separate from its shareholders and possesses the rights, capacity, and privileges of an individual as per the regulations of the Jebel Ali Free Zone.
The purpose of a Public Limited Company (PLC) is to provide a legal structure for businesses to raise capital by offering shares to the public. It allows for limited liability, where shareholders’ financial risk is limited to their investment in the company following Federal Decree-Law No. 32 of the UAE Commercial Companies Law. Along with this being the part of free zone PLC also aims to facilitate business expansion, and attract investors by providing share trading opportunities in the public market and 100% foreign ownership opportunities.
How PLC Operates in Dubai Free Zones?
A PLC functions in accordance with the regulations established by the relevant free zone authority, while also adhering to the UAE Commercial Companies Laws. For instance, operating a PLC in JAFZ requires obtaining a valid license in line with the Companies Implementing Regulations 2016 of JAFZA. Each free zone has its own set of rules for PLC operations based on UAE Federal Law No. 8 of 2004, yet they must all comply with the broader UAE Commercial Companies Laws, including those governing taxation and other business operations.
Every Free Zone has set specific rules for different types of business entities regarding their operational activities. Unlike other entities, a PLC allows for the transfer of shares. For example, a PLC in JAFZA can transfer shares in accordance with market laws which demand to list the shares on a stock exchange within 9 months from the date of incorporation, as outlined on their official website. However, the date of listing can be extended Registrar.
However, just like other types of companies, PLCs are also limited to operating within the free zone. To conduct business activities in the mainland, investors can obtain a mainland license from the DED with permission from the free zone authority, as per the UAE’s official portal. Additionally, a PLC can be converted to an FZE or FZCO, and vice versa, after a special resolution is approved by the registrar, as stated in the JAFZA Companies Implementing Regulations 2016.
How many shareholders are there in PLC in the Dubai Free Zone?
The number of shareholders possible for a PLC(Public Listed Company) is two or more. The shareholders of plc can be individuals, corporations, financial institutions, or a mix of these. However, the liability of a shareholder is limited to the capital paid by the shareholder in the PLC.
Shares can be partly paid, provided they are paid up to at least one-quarter of their value. However, bearer shares or fractional shares cannot be issued, as stated in Jebel Ali Free Zone regulations. Additionally, a shareholder agreement is mandatory, requiring a minimum of two shareholders. This agreement, as mandated by Free Zone regulations, safeguards shareholder rights while ensuring clarity, predictability, and effective dispute resolution within the company.
Public Listed Company (PLC) Setup Process
Formation of a Public Listed Company (PLC) in a Dubai Free Zone requires following a unique regulatory framework set by the free zone authorities. The first step is selecting a suitable free zone. After this, the other basic steps include obtaining license approvals, appointing directors, and drafting legal documents.
The overall process is primarily regulated by free zone authorities and federal bodies like the DED, FTA, and the Ministry of Economy. However, the process will not be the same if you are converting an FZE or FZCO to a PLC. The step-by-step procedure provided below is for establishing a new PLC within the free zone from scratch.
- Define Business Activities
- Reserve a Company Name
- Prepare Legal Documents
- Passport Copies
- Proof of Address
- Business Plan
- Shareholder Agreement (if applicable)
- Memorandum of Association (MOA)
- Ultimate Beneficial Owner (UBO) Declaration
- Appoint Directors and Shareholders
- Establish Minimum Capital Requirements
- Open a Corporate Bank Account
- Apply for a Business License
- Obtain Approvals and Registrations
- Issue Shares to the Public
- Secure Office Space
- Set Up Operations
What is the cost of a Free Zone Company PLC setup in Dubai?
The cost of setting up a Public Listed Company (PLC) in Dubai ranges from 20,000 AED to 70,000 AED. However, the cost depends on different factors. The cost of 6 key factors are provided below:
- Trade License Fee
- Registration and Administrative Fees
- Office Space
- Share Capital
- Legal and Documentation
- Visa Fees
- Miscellaneous Fees
The table below provides the costs, including the broad sections of activities involved in setting up a PLC. For a detailed analysis, you can consult with our expert.
| Cost Component | Estimated Cost (AED) |
| Trade License Fee | AED 8,000 to AED 30,000 |
| Office Space | Approximately AED 10,000 (Virtual office with Ejari registration) |
| Registration and Administrative Fees | AED 776.50 (Trade name reservation) + AED 256.50 (Initial approval) |
| Share Capital Requirements | Recommended capital between AED 100,000 to AED 500,000 |
| Additional Costs | Notarization, legal translations, and other administrative services |
What are the legal requirements for a PLC in the Dubai Free Zone?
The legal requirements for setting up a PLC within the free zone in Dubai are mentioned below.
Shareholder and Directors
A minimum of two shareholders and two directors are required for establishing a PLC as per JAFZ’s official website. The shareholder can be a natural person, a corporation, or a mix. However, for a director, it is a must to have one natural person (age more than 21), as per the Jafza Companies Implementing Regulations 2016.
Minimum Share Capital
Each free zone has a specific amount of share capital that investors must fulfill. For instance, in JAFZ, it must be greater than the amount needed for its licensed activities or the amount mandated by securities market regulations. Overall, the minimum share capital for a public joint stock company in the UAE starts at AED 30,000,000 according to Article 195 of Federal Decree Law No. (32) of Commercial Companies. However, this can be amended under a resolution by the Cabinet.
Public Offering
A PLC offers shares to the public to raise capital. This enhances visibility, credibility, and access to funding. However, IPOs are complex and costly, requiring compliance with stringent regulations. Investment banks often underwrite IPOs, assisting in the process. Publicly traded companies face increased scrutiny and regulatory burdens.
Business License
Just like other free zone entities, a PLC also requires a business license as per the legal activity list of the United Arab Emirates Department of Economic Development’s Business. Also along with this, you need to follow the specific free zone authority.
Office Space
For PLC, office space within the free zone is optional, whether to have a physical or virtual office space. However, virtual offices are accepted only for limited activities. These include freelance etc.
UBO Form
The UBO (Ultimate Beneficial Owner) form is essential to identify the true owners of a company as per the Cabinet Decision No. (58) This helps government authorities to better understand financial dealings while ensuring transparency.
KYC form
The KYC (Know Your Customer) form is essential for registration with the Securities and Commodities Authority (SCA), as per the JAFZ official website. The purpose of KYC is to prevent financial crimes like money laundering. Additionally, it helps in verifying customer identities and understanding their financial activities.
What are the Advantages of a Public Listed Company in the Dubai Free Zone?
The advantages of a Public Listed Company (PLC) in Dubai include access to capital, credibility and reputation, the opportunity to buy and sell shares, market exposure, regulatory oversight, mergers and acquisitions, tax incentives, and limited liability. Below are the 9 key advantages of a PLC in Dubai
- Access to Capital: Global Fund Flow, Free Zone Incentives, Offshore Investment
- Credibility & Reputation: Global Brand Image, Free Zone Advantage, Investor Trust
- Liquidity: Global Market Access, Offshore Trading, Investment Flow
- Market Exposure: Global Market Reach, International Trade, Free Zone Hub
- Attracting Talent: Global Talent Pool, Skilled Workforce, Free Zone Ecosystem
- Regulatory Oversight: Free Zone Compliance, International Standards, Risk Mitigation
- Enhanced Governance: Best Global Practices, Transparent Operations, Investor Confidence
- Diversification: Global Market Reach, Multi-National Business, Free Zone Growth
- Tax Incentives: Free Zone Benefits, Reduced Costs, Competitive Advantage
What are the Disadvantages of a Public Listed Company (PLC) in a Free Zone in Dubai?
PLC offers multiple benefits to investors; however, it also has some drawbacks, which, if not handled carefully, can cause operational issues. The three common disadvantages of Public Listed Company (PLC) in Dubai are provided below:
- Limited Access to Mainland Market
- Higher Operational Costs
- Dependence on Free Zone Authority
What is the Difference Between PLC and FZE?
The difference between PLC and FZE is significant in terms of structure, capital requirements, setup time, and other key factors. Below is a detailed comparison of PLC and FZE to help guide your decision-making process:
| Aspect | Public Listed Company | Free Zone Establishment |
| Abbreviation | PLC | FZE |
| Number of Shareholders | Two to Multiple shareholders | Single shareholder |
| Ownership | 100% foreign ownership | 100% foreign ownership |
| Type of Entity | Public joint-stock company | Limited liability company |
| Capital Requirement | higher capital requirements | require specific paid-up capital. |
| Setup Time | 1-5 weeks | 1-2 weeks. |
| Setup Cost | 20000-70000 AED | 15000-45000 AED |
| Decision-Maker | board of directors accountable to shareholders. | A single shareholder with full decision-making authority. |
| Visa Options | multiple visas, facilitating a larger workforce | a limited number of visas, subject to free zone regulations |
| Office Space (physical) | Requires larger office space | May require smaller office space |
What is the difference between PLC and FZCO?
The difference between PLC and FZCO is primarily due to offering shares, as PLC can offer shares to the public, but FZCO cannot, as per the Jebel Ali Free Zone Companies Regulation 2016. The table below highlights some of the key differences between PLC and FZCO.
| Aspect | Public Listed Company | Free Zone Company |
| Abbreviation | PLC | FZCO |
| Number of Shareholders | Two to multiple shareholders | Two to 50 shareholders |
| Ownership | 100% foreign ownership | 100% foreign ownership |
| Type of Entity | Public joint-stock company | Limited liability company with multiple shareholders |
| Capital Requirement | Higher capital requirements | require specific paid-up capital |
| Setup Time | 1-5 weeks | 2-4 weeks |
| Setup Cost | 20,000-70,000 AED | AED 30,000 to AED 80,000 |
| Decision-Maker | Board of Directors accountable to shareholders | Multiple decision-makers or a board of directors |
| Visa Options | Multiple visas, facilitating a larger workforce | Can sponsor multiple visas. |
| Office Space (Physical) | Requires larger office space | Depends on business activity. |
What is the difference between a PLC and an FZ LLC?
The difference between a PLC and an FZ LLC mainly lies in offering to share publicly, permitted activities, and legal obligations. Below is a detailed comparison of a PLC and an FZ LLC for your reference.
| Aspect | Public Listed Company | Free Zone Limited Liability Company |
| Abbreviation | PLC | FZ LLC |
| Number of Shareholders | Two to multiple shareholders | Two or more shareholders |
| Ownership | 100% foreign ownership | 100% foreign ownership |
| Type of Entity | Public joint-stock company | Limited liability company |
| Capital Requirement | Higher capital requirements | Varies by free zone; may require specific paid-up capital. |
| Setup Time | 1-5 weeks | 2-4 weeks |
| Setup Cost | 20,000-70,000 AED | 15,000-45,000 AED |
| Decision-Maker | Board of directors accountable to shareholders. | Managed by shareholders or designated directors. |
| Visa Options | Multiple visas, facilitating a larger workforce. | Can sponsor multiple visas. |
| Office Space (Physical) | Requires larger office space | May require smaller office space or flexi-desk options. |
