Free Zone is a type of business jurisdiction in UAE. It allows 100% ownership for the investor after registering their company. Also, the governance of the company is vested with the respective Free Zone Authority.These regions are also known as free trade zones or a free zone authority. Free trade zones attract 0% tax rates, preferential customs duty rates and 100% import and export tax exemption.
UAE is home to numerous Free Trade Zones that support the growth of trade and the economy of the region. There are various business activities available in the Free Zones for doing business. In UAE there are more than 45 Free Zones delivering various company packages for investors. Free Zone in UAE is an area demarcated within the country. It is a designated area where investors can legally trade and avail various incentives for their business
The UAE offers investors more than 40 multidisciplinary free zones, in which expatriates and foreign investors can have full ownership of companies. These zones are characterized by their highly efficient infrastructure, and distinct services that facilitate smooth workflows, saving businesses considerable time and effort.
Benefits Of Setting Up A Business In Dubai Free Zone
Free Zones Are The Most Favorable Locations For Business Setup Equipped With State-Of-The-Art Infrastructure, Duty And Tax Exemptions, World-Class Business Amenities, Flexible Government Policies, And Unmatched Facilities.
These Are Not The Only Factors That Drive Dubai Free Zone Company Formation; There Are Many More Benefits Of Forming A Dubai Free Zone Company, Like:
- 100% Ownership For Investors, Regardless Of Their Nationality And Country Of Origin
- 100% Tax Exemption On Personal Or Corporate Income Or Gains
- 100% Repatriation Of Capital And Profits
- Exclusion From All Import And Export Duties
- Handy Office And Warehouse Facilities
- Option For A Company Set Up By An Individual
- Exemption On Corporate Tax For 15 Years, Renewable For Another 15 Years
- Complete Secrecy Of Operations
- Flexibility To Engage In International Business
- Fewer Renewal Charges
- Flexibility To Hold Properties, Participate In Multiple Activities, And Open A Bank Account In Dubai
- The Option Of Liquidating Anytime
- Assistance In Housing Facilities, Staff Visas, And Other Support Services
HOW MUCH DOES IT COST TO SET UP A FREE ZONE COMPANY IN DUBAI?
Various costs involved in setting-up a company in a Dubai Free Zone vary significantly from Free Zone to Free Zone and depending on what type of company you want to set-up
1. Trading License
This Type Of License, If Acquired, Allows One To Carry Out Trading Activities Like Buying, Import & Export, And Selling Of A Limited Number Of Commodities.
2. General Trading Activities
One Can Deal With The Trading Of All Types Of Goods, With An Exemption On A Few Banned Products Which Need Special Approval With This License.
3. Service License
Companies That Want To Deal With Activities Like Consulting, Accountancy, Etc. Can Acquire This License.
4. Industrial License
A Company Can Carry Out Manufacturing, Packaging And Processing Activities After Obtaining This License.
Types Of Business Entities Allowed In Dubai Free Zone
1. Free Zone Establishment (FZE)
This Type Of Company Can Be Registered With 1 Individual Or Corporate Shareholder.
2. Free Zone Company (FZC)
This Type Of Company Can Be Registered With 2 Or More Shareholders. A Shareholder Can Be An Individual Or A Company.
3. Branch Office
A Business That Has A Company In The UAE Or A Foreign Land Can Have A Branch In One Of The Free Zones Of Dubai.
How To Open A Company In Dubai Free Zone?
Dubai Offers Rewarding Options For Company Formation To Investors, To Set Up Their Business Anywhere In The Emirates Depending On The Type Of Their Business, Location (Free Zones, Mainland Or Offshore), Budget, Ownership Preferences (100% Ownership Or Local Sponsorship), And Other Such Factors. There Are Certain Formalities And Procedures To Be Completed In Order To Set Up A Business In Dubai Free Zones. These Need Acute Planning, Knowledge Of Local Culture And Government Norms, And Elaborate Decision-Making, Through Different Business Setup Phases.
Procedure To Set Up A Business In Dubai Free Zone
There Are 6 Simple Steps Included In The Dubai Freezone Company Setup.
- Choose A Business Activity
- Find A Suitable Free Zone
- Choose A Trade Name
- Gather Important Documents
- Apply For A License
- Open A Business Bank Account
The Steps Are Explained As Below:
1. Choose A Business Activity
Decide A Business Activity You Wish To Carry Out, As The Type Of License You Apply For Will Depend Upon The Nature Of The Business Activity. Many Dubai Zones Allow For Multiple Business Activities, So Have Many Options To Explore.
2. Find A Free Zone
Once You Have Decided On A Business Activity, The Next Step Is Deciding Which Free Zone Is Right For You. Basically, There Are Sector-Specific Zones Like IT, Healthcare, Commerce, Trading, Etc., Therefore, Research Before Choosing One Particular Zone.
3. Choose A Company Name
Before Finalizing A Name, You Need To Ensure That Your Business Name Is Available To Be Registered On The Dubai Free Zone Authority Portal. There Are Also Certain Standards That The Name Must Adhere To, Including Avoiding Any Blasphemous Language Or References To Religious Or Political Organizations.
4. Gather All The Documents And Apply For A License
After Deciding The Business Activity And Registering The Trade Name At The Portal, The Next Crucial Step Is To Apply For A License. The Type Of License Depends On Business Activity. To Apply For The Same, You Need To First Fill The Application Form And Gather The Documents, As Mentioned In The Form. Also, You Can Make A Visa Application During This Process.
5. Open A Corporate Bank Account
Opening A Bank Account Is An Easy Process. But To Do So, You Have To Again Gather The Documents As Well As Your Business License After The 4th Step, You Will Get A Valid License Within 2-4 Weeks, And You Are Good To Go.
Documents Required For Dubai Free Zone Company Formation
For A Business License:
Color Copy Of Shareholder(S)’ Passport And Visa, If Applicable
- Application Form
- Business Plan
- Board Resolution
- Memorandum And Articles Of Association (MAA)
Dubai Free Zone Visa Benefits
- Freedom of doing business, substantial tax savings, and a robust infrastructure lead investors and business people to set up their operations in Dubai-free zones.
- Exploring options that a Free Zone provides for businesses can lead to finding new and better growth opportunities.
- The free zone helps speed up business activities and attracts companies looking to invest their capital in entrepreneurial enterprises.
What is a Freezone visa?
This type of visa provides a temporary residence for three years to foreign entrepreneurs either having a business or wanting to start a business in any free zone across the UAE.
Here are the list of Free Zones you can apply for:
Dubai Auto Zone
Dubai Biotechnology & Research Park (DuBiotech)
Dubai Car and Automotive City Free Zone (DUCAMZ)
Dubai Flower Center
Dubai Industrial City (DIC)
Dubai Outsource Zone
Dubai Techno Park Free Zone
Dubai Technology and Media Free Zone
International Media Production Zone
Jumeirah Lakes Towers Free Zone
DUQE Free zone
To get more information about investment conditions in free zones of Dubai, please contact Soha Asia Follow Up Services consultants.