🔹 Step 1: Choose the Right Company Structure
To trade forex in Dubai, the best options are:
| Option | Key Features |
|---|---|
| Free Zone Company (e.g., in DMCC, IFZA, Meydan, etc.) | 100% foreign ownership, no customs duties, simplified licensing |
| Mainland Company | Needs local sponsor/shareholder, but allows broader business activities |
| IFC License (DIFC or ADGM) | Regulated by DFSA; expensive and used for regulated investment funds or brokerage |
✅ For personal or proprietary forex trading, a Free Zone Company is sufficient.
🔹 Step 2: Select the Right Free Zone
Popular Free Zones for forex trading setup:
- DMCC (Dubai Multi Commodities Centre) – premium zone with financial reputation
- Meydan Free Zone
- IFZA (International Free Zone Authority)
- RAKEZ – lower cost zone in Ras Al Khaimah
🔹 Step 3: Register Your Company
Typical documents needed:
- Passport copy
- Business plan (basic if not regulated)
- No objection certificate (if UAE resident)
- Address proof
📌 Choose a business activity like:
“Proprietary Trading in Derivatives and Currencies (Own Funds)”
✔️ This does not require DFSA regulation, as you’re not managing client money.
🔹 Step 4: Open a Corporate Bank Account in UAE
- Open with Emirates NBD, ADCB, Mashreq, or digital banks like WIO.
- You will receive an IBAN in AED or USD to fund the trading account.
🔹 Step 5: Open a Forex Trading Account
You can now open an account with regulated international brokers like:
- Interactive Brokers
- Saxo Bank
- Exness
- IC Markets
- Pepperstone, etc.
Use your Dubai company details and corporate bank account for funding.
📜 ODI Compliance (for Indian Residents)
If you are an Indian resident and investing in the Dubai company:
You must comply with the Foreign Exchange Management (Overseas Investment) Rules, 2022.
🔸 What you must do:
- Board Resolution to invest in the foreign company
- File Form FC with your AD Bank before remittance
- File Form ODI Part I for investment
- File APR (Annual Performance Report) every year
- Repatriate dividends/income regularly as per ODI rules
🔴 Illegal if You Skip ODI
Many people send money abroad for forex via crypto or hawala or misuse LRS. This is illegal and attracts penalty under FEMA.
💡 Set it up properly with ODI route to avoid:
- Penalties
- Income tax scrutiny
- ED or FEMA violations
💰 Taxation in India
Even if the company is in Dubai:
- If you control it from India, it may become a “Controlled Foreign Company” or POEM (Place of Effective Management) in India.
- Profits may be taxed in India unless you maintain separate books, local office, and mind & management in Dubai.
✅ Summary Table
| Task | Notes |
|---|---|
| Company setup in Dubai | Use DMCC, IFZA, Meydan, etc. |
| Business activity | “Proprietary trading in FX and derivatives” |
| Forex broker account | Open in company name |
| ODI compliance (for Indian investors) | Mandatory under FEMA if funded from India |
| Bank account | UAE IBAN in AED/USD |
| Repatriation | Declare returns to India; file APR |
📞 Need help?
I can help you with:
- Drafting Board resolutions & ODI forms
- Referrals to Dubai company setup agents
- Broker selection and compliance mapping
- RBI-compliant structure for forex trading
Would you like a sample structure or costing estimate?
