What's the difference between a sole establishment and a one-person LLC in the UAE?

Both let one person own a business, but they differ in legal separation and liability. A sole establishment (sole proprietorship) is owned by one individual and is not a separate legal entity from that person, so the owner is generally personally liable for the business's debts and obligations with their own assets. A one-person (single-owner) LLC is a Limited Liability Company owned entirely by one person but is a separate legal entity, so liability is generally limited to the capital contributed to the company. That separation is the main reason founders often prefer a single-owner LLC for activities carrying commercial risk, while sole establishments are commonly used for certain professional activities. Ownership rules, permitted activities, and any local-agent requirements can differ between the two and by emirate. Because the right choice depends on your activity and risk exposure, confirm the available options with the economic department before registering. To weigh the liability implications for your situation, you can compare verified UAE legal professionals on LEXAI.