Business Set-up in UAE Free Zones

UAE, a global business hub, is home to over 45 specialized Free Zones, catering to various industries and sectors. These Free Zones, also known as Special Economic Zones or Free Trade Zones, are designed to attract foreign direct investment by offering numerous benefits and incentives for businesses operating within their jurisdiction. Each Free Zone is regulated by independent authorities, such as the Jebel Ali Free Zone Authority (JAFZA) for the Jebel Ali Free Zone, ensuring a business-friendly environment for entrepreneurs and investors.

These Free Zones provide world-class infrastructure, state-of-the-art facilities, and a supportive ecosystem for businesses to thrive and grow.

List of Industry-specific Free Zones in Dubai

Dubai offers a variety of Free Zones tailored to cater to specific industries, providing sector-focused facilities and infrastructure that help businesses flourish.

• Jebel Ali Free Zone (JAFZA) – Logistics, Manufacturing, Trading
• Dubai Multi Commodities Centre (DMCC) – Commodities Trading, Gold, Diamonds, Tea, Pearls
• Dubai International Financial Centre (DIFC) – Financial Services
• Dubai Internet City (DIC) – Information Technology, Telecommunications
• Dubai Media City (DMC) – Media, Broadcasting, Advertising
• Dubai Design District (D3) – Design, Fashion, Art
• Dubai Healthcare City (DHCC) – Healthcare, Medical Services
• Dubai International Academic City (DIAC) – Education, Research
• Dubai Knowledge Park (DKP) – Human Resource Management, Professional Development
• Dubai World Central (DWC) – Aviation, Logistics, Exhibition
• Dubai South – Logistics, Aviation, E-commerce
• Dubai Science Park (DSP) – Science, Research, Environment
• Dubai Silicon Oasis (DSO) – Technology, Electronics, Semiconductor Manufacturing
• Dubai Outsource City (DOC) – Business Process Outsourcing, IT Services
• International Humanitarian City (IHC) – Humanitarian Aid, Non-profit Organizations
• Dubai Production City (DPC) – Publishing, Printing, Packaging
• Dubai Studio City (DSC) – Broadcasting, Production, Film
• Meydan Free Zone (MFZ) – Media, Design, Communications, Technology, Entertainment

Benefits of setting up a company in a Dubai Free Zone

• Complete foreign business ownership: 100% foreign ownership without the need for a local sponsor.
• Tax exemptions: exemptions on corporate taxes, import-export duties, and personal income taxes.
• Ease of incorporation: The process is straightforward, with minimal bureaucratic hurdles and red tape.
• Flexible office space solutions: from Flexi Desks at co-working spaces to lease and purchase options.
• No restrictions on hiring expatriates: no trade barriers or quotas on recruiting talent from around the world.
• Strategic location and transportation hubs: close proximity to key transportation routes and hubs, such as airports, seaports, and major highways, enables businesses to save on logistics costs, faster shipping times, and easy access to regional and international markets.
• Access to a vast network of resources: access to a wide range of support services, including legal and financial advisory, and networking opportunities with other businesses in the area.
• 100% repatriation of capital and profits: no restrictions on all capital and profits repatriation.
• Minimal financial audit requirements: reduced administrative burdens and costs for businesses operating in Free Zones.
• Dual license options: Some Dubai Free Zones allow businesses to operate both within the Free Zone and on the UAE mainland, without the need for additional legal entities or complex procedures.

Steps to Register a Company in a Dubai Free Zone

• Obtain a business license
  This license, also known as a trade license, must be renewed annually and is valid for one year from the date of issuance.
• Get a UAE Residence Visa
  Foreign investors and employees are required to obtain a UAE Residence Visa, which allows them to live and work in the country legally.
• Open a corporate bank account
  This is an essential step for managing your company’s finances and transactions and we advise you to research and compare various banking options to find the most suitable one for your business needs. Our expert consultants will be happy to assist you with that. Learn more about UAE Bank Account Opening.
• Select a license type and business activity
  Each Free Zone has specific rules regarding the number of activities that can be added to a single license. You must choose a suitable license type (e.g., Trading, Service, or Industrial) and business activity based on the regulations of the chosen Free Zone.
• Choose a corporate structure
  Select a corporate structure for your company, such as a New Company, Subsidiary Company, Joint Venture Company, or Branch of a Local or Foreign Company. Ensure that the chosen structure is in compliance with the Free Zone’s regulations and requirements.
• Select a trade name and prepare documents
  Propose three trade name options in order of preference and prepare the required documents for company registration. These typically include passports, visas, proof of residential address, professional CVs, and any additional documents required by the Free Zone.
• Apply for initial approval
  Submit your application for initial approval, which includes confirming the company name, business activity(ies), and proposed company structure.
• Sign legal documents for company incorporation
  After obtaining initial approval, arrange a face-to-face meeting or video call with a Free Zone representative to verify shareholder passports or UBOs and sign legal documents such as Articles of Association, Board Resolution, and Specimen Signature Form.
• Establish a business location
  Secure a commercial property within the chosen Free Zone by signing a Tenancy Contract (minimum of 1 year) and obtaining the Ejari Certificate. Provide these documents to the Free Zone to finalize the address for your license.
• Collect business license and other corporate documents
  Your business license will be issued along with other corporate documents such as a Certificate of Incorporation, Share Certificate(s), Articles of Association, and Lease/Tenancy Contract.

Limitations of Dubai Free Zone Companies

• Restrictions on conducting business in mainland Dubai
  To operate in the mainland, these companies often need to partner with a local distributor or establish a separate mainland company.
• Limitations on visa applications
  Visa quotas may vary between Free Zones, and sometimes restrictions are imposed on the number of visas a company can obtain based on its size, office space, and business activities.
• Minimum share capital requirements
  Some Dubai Free Zones require companies to maintain a minimum paid-up share capital during the Free Zone company formation process, which can impact the initial investment needed for the set-up.

Ajman Free Zone (AFZ)

Ajman Free Zone, established in 1988, is one of the most cost-effective and business-friendly Free Zones in the United Arab Emirates. Located in the Emirate of Ajman, AFZ is strategically positioned near Ajman Port, providing easy access to international shipping routes and proximity to Dubai and Sharjah.

Key Features of Ajman Free Zone

• Cost-effective business setup: a variety of cost-effective business setup packages makes it an attractive option for small and medium enterprises (SMEs) and startups.
• Wide range of business activities: AFZ accommodates various business activities, including trading, manufacturing, services, and e-commerce.
• Fast and efficient registration process: streamlined registration process allows for easy and quick company formation in AFZ.
• Modern infrastructure: state-of-the-art infrastructure, including office spaces, warehouses, and labor accommodation.

Advantages of Setting Up a Company in Ajman Free Zone

• 100% foreign ownership without requiring a local sponsor.
• Tax exemptions from corporate and personal income taxes.
• No currency restrictions and the possibility for 100% repatriation of capital and profits.
• Multiple visa options.
• World-class facilities.

Business License Types in Ajman Free Zone

• Trading License: For trading activities, such as import, export, and distribution of goods.
• Industrial License: For manufacturing, processing, and assembly operations businesses.
• Service License: For service companies such as consulting, management, and logistics.
• E-commerce License: For online trading, retail, and other e-commerce activities.

Steps to Set Up a Company in Ajman Free Zone

• Choose a business activity and license type based on your company’s operations.
• Select a company structure: a Free Zone Establishment (FZE), Free Zone Company (FZC), or a Branch of an existing company.
• Reserve a trade name for your company.
• Submit the required documents, such as passport copies, business plan, and proof of address, as required by AFZ.
• Pay the applicable fees.
• Obtain your business license once your application is approved.

Ajman Free Zone offers numerous advantages for businesses seeking a cost-effective and efficient environment in the UAE.

Ras Al Khaimah Economic Zone (RAKEZ)

Ras Al Khaimah Economic Zone (RAKEZ) is a world-class business hub established in 2017. It was formed through the consolidation of two renowned free zones: Ras Al Khaimah Free Trade Zone (RAKFTZ) and Ras Al Khaimah Investment Authority (RAKIA). RAKEZ has cost-effective and streamlined company formation processes, making it an ideal choice for entrepreneurs and investors alike.

RAKEZ Advantages

• Cost-effective business setup options.
• Wide range of business activities, including trading, manufacturing, services, and logistics.
• Strategic location near major transportation hubs offers easy access to local and international markets.
• 100% foreign ownership.
• Zero corporate and personal income tax.
• State-of-the-art facilities and modern infrastructure.

RAKEZ Business Licenses

• Commercial License: for companies involved in trading, import, export, and distribution of goods.
• Individual/Professional License: for professionals in various fields of expertise, such as consultants, lawyers, and architects.
• Consultancy/Services License: for companies providing specialized consultancy or services.
• Educational License: for educational institutions and training centers.
• Industrial License: for manufacturing, processing, or product assembling companies.
• Media License: for businesses in media-related fields such as advertising, publishing, and production.
• General Trading License: for companies involved in the trading of various goods and products, both locally and internationally.
• E-commerce License: for businesses involved in online trading, retail, or other e-commerce activities.
• Tourism License: for companies providing tourism-related services, such as travel agencies, tour operators, and event organizers.

RAKEZ Company Formation Process

• Choose a business activity and license type.
• Determine the legal structure: a Free Zone Establishment (FZE), Free Zone Company (FZC), or a Branch of a local or foreign company.
• Submit application and required documents, such as passport, business plan, and proof of address.
• Receive initial approval and make payment.
• Sign the lease agreement for your chosen facility and collect your business license to commence operations.

With its strategic location, modern facilities, and streamlined processes, RAKEZ provides an ideal environment for businesses to thrive and succeed in the UAE market.

Factors to consider when selecting a Free Zone

When choosing the right Free Zone for your business, several factors should be taken into account:

• Business activities: Ensure that the Free Zone you select permits your desired business activities and offers the necessary resources and infrastructure to support them.
• Location: Consider the proximity of the Free Zone to key transportation hubs, such as airports and seaports, as well as its accessibility to potential clients and suppliers.
• Setup costs and fees: Evaluate the registration, licensing, and operating costs of each Free Zone to determine which one offers the best value for your investment.
• Visa quotas: Some Free Zones may have restrictions on the number of visas that can be issued for employees, so consider your workforce requirements when making your decision.
• Office space options: Choose a Free Zone that offers the type of office space that suits your business needs, whether it’s a Flexi Desk, dedicated office, or warehouse.

Weighing the pros and cons of forming a company in a Free Zone

The decision to establish a company in a Free Zone should be based on a thorough understanding of its specific regulations and overall business objectives.

Seeking professional advice and assistance during the company formation process is crucial to ensure the best possible outcome. Experts in the field can guide you through the complex process of selecting the right Free Zone, obtaining licenses and visas, setting up a corporate structure, and navigating potential limitations. Their expertise can save you time, effort, and resources while also ensuring compliance with local regulations.

If you are considering forming a company in one of the Free Zones, don’t hesitate to reach out to our team of experienced professionals for consultation and guidance. Our experts will carefully analyze your business needs and recommend the most suitable option for your company. Contact us today to start your journey toward a successful company set-up in one of UAE’s prestigious Free Zones.

To learn about company formation in Dubai Mainland please visit our page Business Set-up in Dubai Mainland.