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Dubai

Handicra
fts L.L.C.
Business
Organizatio
n,
Internation
al Business
Law and
Intellectual
Property

Contents
Section 1.....................................................................................................................................3
Type of Business Selected......................................................................................................3
Advantages and Disadvantages of a Limited Liability Company..........................................4
Advantages..........................................................................................................................4
Disadvantages.....................................................................................................................4
Reasons for doing business internationally............................................................................5
Importance of International Law for Dubai Handicrafts L.L.C.............................................5
Section 2.....................................................................................................................................6
Protection of trademarks, copyright, patent Laws in the UAE...............................................6
UAE Trademark Law.............................................................................................................6
UAE Copyright Law...........................................................................................................7
UAE Patent Laws................................................................................................................7
Benefits of trademark for Dubai Handicrafts L.L.C...............................................................8
Trademark infringement effects on Dubai Handicrafts L.L.C...............................................8
Trademark infringement can seriously damage our brand as its a speciality brand and such
a brand could not afford trademark infringement or fake reproduction of its products or
services...................................................................................................................................8
Conclusion..................................................................................................................................8
UAE trademark law effective or not...................................................................................8
Enforcement of the Law.....................................................................................................8
References..................................................................................................................................9

Section 1
Type of Business Selected
The type of business selected for this project is a Limited Liability Company L.L.C. and the
name of company is Dubai Handicrafts L.L.C. (Limited Liability Company). The advantages
and disadvantages of becoming a LLC according to UAE Federal Law No. (8) of 1984 as
amended by Federal Law No. (13) of 1988 Commercial Companies are as follows. The
articles concerning LLC in the Law are Article 218 to 226 for Establishment of the
Company, Article 227 to 234 law the law for Shares and Capital of LLC and Articles 235 to
255 are about management of the company, these articles fall in Chapter 7 of UAE
Commercial Companies Law.
Article 224 states that the company shall make a Memorandum of Association and the
Ministry may provide the draft a specimen Memorandum of Association. Article 225 states
that for the registration purpose the manager of the company could also process the
application for entry in the Register of Commerce. Dubai Handicrafts has a Paid up share
capital of AED 150,000 with each share of AED 1,000 deposited in the companys bank
account as stated by Article 227.
According to Article 228 the companys register shows the following details:
Name & Surname, place of residence: Partner 1
Name & Surname, place of residence: Partner 2
Nationality Partner 1: UAE
Nationality Partner 2: UAE
Partner 1: 51 Shares
Partner 2: 49 Shares
Article 229 provides the law that the company shall provided the Ministry of Commerce and
Industry with the details recorded in the register before January every year.

Article 235 states that the partners could appoint managers to manage the business and they
should not be more than five. Article 238 states that the managers must prepare financial
statements within three months after the expiry of the financial year. Article 244 to 251 lay
down the rules for general meeting, and state that a general meeting must be held every year
within four months of the expiry of the financial year, and everyone must attend only
directors can send a proxy in case they cannot attend the meeting.
Article 253 states that the company must appoint an auditor each year for the audit of the
company.

Advantages and Disadvantages of a Limited Liability


Company
Advantages

According to Article 218, UAE Federal Law No. (8) of 1984 as amended by Federal
Law No. (13) of 1988 Commercial Companies, LLC is a business which could be
owned by two to fifty partners. Also the draft UAE commercial companies law states
that a limited liability company could also be formed by a sole share holder, another

advantage of being LLC.


Also Dubai Handicrafts LLC is treated as an entity separate from its members, which

is another advantage of LLC.


Article 218 further state that the partners have a limited liability, which is limited to
the nominal value of capital. Hence it protects the partners from unlimited liabilities

in case of liquidation of the company, which is an advantage to be LLC.


Hence 51% of share will be with us always so no one will be able to takeover Dubai

Handicrafts LLC.
Also Limited liability makes this form of business ownership an attractive alternative

for investors, hence we will be able to attract more investors.


The transfer of ownership could be done without affecting the operations of LLC,

which is another advantage.


Dubai Handicrafts will be able to choose between the tax regimes and could choose to
pay tax as a sole trader or as a corporate business.

Disadvantages

Double Taxation: Dubai Handicrafts will be taxed twice once when it pays the yearly
corporate tax and second when shareholders get their dividends they will be required
to pay tax as well.
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Heavily Regulated: Dubai Handicrafts will have to keep up-to-date with all the
corporate compliance and statutory requirements as listed above as noted by
Ramlochan, D. & Lalla, C. (2006).

Shareholders can lose the money they have invested in Dubai Handicrafts LLC.

Reasons for doing business internationally

Due to an increase in the tourism & business in Dubai volume of international trade
and tourism has doubled in order to capture the niche and greater market share we

have chosen to engage in import/export of handicrafts internationally.


Also the world has become a global place, to keep up with the pace of globalization
and the changing environment we have to cater our services to serve everyone in the

global village.
To compete in the market we will have to become a multinational to gain competitive
edge.

Importance of International Law for Dubai Handicrafts L.L.C.


International law has a vital role in import/export of Dubai Handicrafts LLC as we will have
to face legal systems of the major countries we are exporting to, treaties, practices, tariffs and
nontariff trade barriers, also import and export quotas, as noted by Liuzzo, A. L. (2012).
Because UAE is a member of WTO hence must comply with TRIPS, for import export we
will also require international trade assistance from freight companies or freight agents
consequently international law plays a very important role in Dubai Handicrafts LLC. World
Trade organization (WTO) and the international agreement GATT along with GATS, TRIPS
and TRIMS all have applications on import/export, which is the core business of Dubai
Handicrafts LLC.

Section 2
UAE has an effective law for protection of intellectual property of an organization, which is
termed as UAE Federal Law. For branding of our products it is very important that we
register our trademark and obtain copyrights and patents laws for all our products/services.
Not registering intellectual property will leave our company vulnerable to trademark
infringement and fake products distributed by others with the name and logo of our company.

Protection of trademarks, copyright, patent Laws in the UAE


The Ministry of Economy and Commerce UAE is responsible for implementation and
enforcement of the Intellectual Property Law. The registration of Trademarks, copyright and
patents are explained below as explain in UAE Intellectual Property Law. According the law
intellectual property is a different category than real property or personal property

UAE Trademark Law


UAE Federal Law No. 8 of 2002 Trademark Law provides the law for trademarks in UAE,
which is administered by the Trademark Section of Ministry of Economy & Commerce.
The registered trademark according to Article 1 to Article 17 is as follows.

HandicraftsTM
The above trademark has been registered with the Ministry, the application was filed by the
trademark owner in the UAE and the application included a deposit of the trade mark with the
Ministry of Economy & Commerce. After the approval of registration the trademark was
published in two daily UAE Arabic newspapers as required by the trademark law UAE.
The period of protection for trademark of Dubai Handicrafts LLC is ten years also the
registrations may be renewed for additional ten-year periods or indefinitely.
Dubai Handicrafts LLC products and services are now protected by the Law Relating to
Counterfeit goods as provided by Article 37 to 43. The law protects our goods from anyone
who makes or sells them which bear HandicraftsTM mark that is the same as, or similar to our
trademark or to mislead the public falls in Trademark Infringement.
The Ministry of Economy and Commerce has the power to enter any vicinity without notice
and shut it down which falls under trademark infringement of our goods.

UAE Copyright Law


Copyright will play an important role in commercial activities of Dubai Handicrafts LLC, it
will provide protection to all the magazines, brochures, catalogues, photographs, videos and
other material generated by Dubai Handicrafts LLC.
Therefore the copyrights of the intellectual property have been obtain by registering with the
UAE Federal Ministry of Information and culture, which is the government ministry
responsible for administering copyright in the UAE.
UAE Federal Law No.7 of 2002 concerning copyright and neighbouring rights governs the
copyright in the UAE, which protects all the material created by our company, and states that
only Dubai Handicrafts LLC has the right to make use of the work.
The law also provides that the copyright could be assigned to a person or organization
consequently Dubai Handicrafts LLC reserves the right to assign copyright, the copyright law
provides 25 years protection for all the work produced by Dubai Handicrafts LLC as stated in
Article 30.
The UAE copyright law protects all the work produced by Dubai Handicrafts LLC from
copyright infringement and enables us to take action against any copyright infirgement of the
work produced as stated in Article 37.
UAE Patent Laws
Dubai Handicraft LLC will be inventing certain products for the market to control the
manufacture and sale of the invention by others in the industry we have obtained patents from
The Ministry of Finance and Industry under the Federal Law No. 17 of 2002 on regulating
and protecting industrial property for patents, designs and industrial models as explained in
Decree of the Federal Law (n.d.).
According to Article 37 and 38 Dubai Handicrafts LLC has also obtained international
patent for its inventions to be exported to rest of the world. Article 64 and 65 provide the law
for the administration of the patent law.
According to Article 14 all our inventions are protected from being reproduced or copied for
a period of 20 years.

Benefits of trademark for Dubai Handicrafts L.L.C.


Trademark will provide Dubai Handicrafts LLC with protection from copying or
reproduction of our products and services in Dubai, and will enable us to compete in the
market without copiers taking the share of our market and damaging the brand.
This will affect the sales revenues of the company, and will have positive effects on imports
and exports of the company.

Trademark infringement effects on Dubai Handicrafts L.L.C.


Trademark infringement can seriously damage our brand as its a speciality brand and such a
brand could not afford trademark infringement or fake reproduction of its products or
services.

Conclusion
After a detailed analysis its been concluded that UAE has a full fledge law for the protection
of intellectual property. The law provides details for copyrights, trademarks and patents and
leaves no questions unanswered.
UAE trademark law effective or not
UAE trademark law indeed is very effective at it has a section on counterfeit goods and
addresses all the issues on trademark infringement. The law provides details on how to
register a trademark, what sort of trademarks could be registered and what not, the process of
registration, the penalties for copyright infringement and all other related issues.
However the penalties described for offences seem to be low and offenders get away by
paying these penalties. It is suggested that stricter penalties and regulations must be put in
place to stop trademark infringement.
Enforcement of the Law
However UAE must place stricter regulations to control trademark infringement by
employing more personnel and increasing penalties for copyright infringement. Intellectual
property rights have been violated in Dubai from many years its time for stricter regulations
to be in place.

References

Federal Law No. (8) of 1984 (n.d.) Commercial Companies. Retrieved from
http://www.uaeahead.com/knowledge/laws/doc/company.pdf
Ramlochan, D. & Lalla, C. (2006). Principles of Accounts: A Complete Course with S.B.A.
Guide. Retrieved from http://books.google.com/books?
id=DcbOGZQkB9oC&pg=RA10PT165&dq=dis+advantages+of+a+limited+liability+company&hl=en&sa=X&ei=sg
rXUKfbL8Wd0QWRhYGYBg&ved=0CDoQ6AEwAA
Liuzzo, A. L. (2012). Essentials of Business Law (8th ed.). USA: McGraw-Hill Companies
Incorporated.
Decree of the Federal Law (n.d.). Protocol Intellectual Property. Retrieved from
http://protocol-ip.com