People from all around the countries consider Dubai the most beneficial place in terms of economic and business advantages. Various factors including elite-class infrastructure, advancement in technology, favorable corporate policies, and business-friendly laws attract a massive number of foreign investments in the country. Do you also want to start a company in Dubai Freezone and enjoy the utmost benefits like increased wealth and maximized revenues?
The guide provides you with comprehensive information on how to setup a freezone company in Dubai, the costs of the Freezone company license in Dubai, a list of freezones in UAE and more.
What is a Freezone Company in Dubai?
Freezones (also known as SEZs or Free Trade Zones across the world) are intended to stimulate international commerce by allowing 100% ownership to expatriates and the ease of a single point of contact for administration. Freezones in Dubai are either related to ports or sector specialized. Dubai has always been a commercial powerhouse, and the country’s economic progress has been strongly linked to the entrepreneurial spirit of the UAE population.
In simpler terms, a free zone company is registered in a defined region known as a free zone jurisdiction. The majority of companies established in these areas do business inside the jurisdiction where the company is registered or outside of the UAE, either trading or providing services.
The UAE is one of the most favorable places for potential foreign investors across the world. Investors and entrepreneurs from numerous countries often show their interest in investing in Dubai businesses. There are multiple options available in terms of opening a company in Dubai including mainland, free zone, and offshore business setups.
However, Dubai freezones are considered the most advantageous jurisdictions for investors who want to setup businesses in various industries. Dubai freezones are designated areas enabling entrepreneurs fully owned and operate their businesses. They are the core trading hub of the region for multiple reasons including stability, corporate-friendly policies, and efficient law and order situation.
List of Freezones in UAE
Furthermore, investors looking to start a company in Dubai freezones can have multiple options to choose from when it comes to freezones. Dubai has the majority of the Freezones including:
Freezones in Dubai
|List of Free zones in Dubai|
|International Free Trade Zone Authority (IFZA)|
|Dubai Multi Commodity Center (DMCC)|
|Dubai Academic City|
|Dubai Industrial City (DIC)|
|Dubai Gold and Diamond Park|
|Dubai Design District (D3)|
|Dubai Airport Freezone (DAFZA)|
|Dubai Healthcare City (DHC)|
|Dubai Internet City (DIC)|
|Dubai International Academic City|
|Dubai Knowledge Village|
|Dubai International Financial Centre (DIFC)|
|Dubai Logistics City|
|Dubai Outsource Zone|
|Dubai Media City|
|Dubai Studio City|
|Dubai Silicon Oasis|
|Dubai Production City|
|Dubai Techno Park|
|Jebel Ali Freezone|
|International Humanitarian City|
Investors looking to start a business in Dubai freezone will have to choose the best one in accordance with their business activities, company setup type, and industry in which they will operate their business. There are approximately 40 freezone jurisdictions in UAE from which you can select one for your company formation:
Freezones in UAE Northern Emirates
|Abu Dhabi||Sharjah||Ras Al Khaimah||Ajman||Fujairah|
|Twofour54||Hamriyah Freezone||Ras Al Khaimah Economic Zone (RAKEZ)||Ajman Media City Freezone||Fujairah Creative City|
|Abu Dhabi Global Markets (ADGM)||Sharjah Media City Freezone (SHAMS)||Ajman Freezone||Fujairah Freezone|
|Higher Corporation for Specialized Economic Zones||USA Regional Trade Center (USARTC) Freezone|
|Abu Dhabi Airport Freezone (ADAFZ)||Sharjah Airport International Freezone (Saif Zone)|
|Industrial City of Abu Dhabi||SRTIP – Sharjah Research Technology and Innovation Park|
|ADPC – Khalifa Port and Industrial Zone (KPIZ)|
|Masdar City Freezone|
|Umm al Quwain|
|Umm al Quwain free trade zone (UAQ FTZ)|
Process of Opening A Company in Dubai Freezones
Dubai freezones are certain economic zones offering free custom duty and tax-free benefits to potential investors. Freezones are regulated pursuant to a distinct framework of laws, rules, and regulations applicable to the concerned jurisdictions. They are managed and regulated by the freezone authority and function outside the scope of the federal laws and policies of the ministry of labour.
In order to open a business in Dubai Freezone, there is a certain procedure that every individual must adhere to. Any negligence in complying with such rules might result in consequences like non-eligibility to get the freezone company formation license. Once you decide the jurisdiction for your free zone company setup, you will have to meet certain requirements.
For instance, you will have to select the name of your company, decide the legal type of your business setup from a free zone limited liability company (FZ LLC) or free zone establishment (FZE), and select an appropriate free zone jurisdiction for your startup, submit the required documents including your passport, NIC, and other legal paperwork.
Cost of Starting a Freezone Company in Dubai
The cost of starting a company in Dubai Freezone depends on the freezone authority and requirement of the visa. Starting price would be AED 5500/- to AED 50, 000/-.However, the cost might vary depending on the various factors including the type of your Freezone business setup, the freezone jurisdiction type where you will operate your business, business activities, company type and size and more.
The Cost of Freezone Company License in Dubai
The freezone license cost in Dubai is between AED 5 750 to AED 35 000 but the cost may vary depending on your industry, business activities, company size, number of visas and more.
Documents Required to Start a Company in Dubai Freezone
To start a business in Dubai freezone aspiring investors will have to provide the required document. However, requirements may vary in terms of individual shareholders and corporate shareholders.
|For Corporate Shareholders||For Individual Shareholders|
|License copy||Passport copies of business shareholders|
|Incumbency certificate||Bank Reference Letter (if required)|
|Registration or Incorporation Certificate||CV or Resume of manager or shareholder|
|Articles and Memorandum of Association||Copies of the Director’s and Manager’s passports|
|Board resolution calling for the incorporation of the proposed entity||Utility bills of shareholders, Directors, Managers, & Secretary|
Benefits of opening a Company in Dubai Freezone
Starting a company in Dubai Freezone comes with countless benefits including:
- It enables foreign investors to attain 100% ownership of their company.
- Simplified import and export process enabling you to be exempt from all customs duties.
- Free zones also give you the liberty to choose from a broad range of core business activities.
- The process of acquiring a free zone business license is fairly smooth and easy. As an investor, you can enjoy convenient administrative services.
- All income earned by free zone businesses can be brought back to their home countries.
- According to UAE legislation, businesses are not required to pay corporation tax from their revenues, allowing them to keep 100% of their revenues tax-free.
- Free zones are strategically situated close to airports, seaports, and international borders. This would unavoidably increase trading benefits for businesses.
- Major seaports and airports in Dubai make it simple to do domestic and international business. You have quick access to suppliers and manufacturers in South Asia and the MENA areas.
- Dubai draws millions of tourists and investors as one of the top transportation destinations around the globe. Thus, there will be possibilities for you to engage with the international business community in the city, which is home to a multi-national community.
Steps to Start a Business in Dubai Freezones
The free zone company formation process is smooth, effortless, and prompt. Aspiring investors can start a business in Dubai freezone within a certain time period once they meet all the requirements and get their business license issued from the concerned department. The bare minimum of paperwork and time is all that the free zone administrators will ask for.
Below mentioned are the steps for starting a business in a freezone.
- Find out the commercial activity of the legal entity.
- Decide on a name for the business setup in the free zone.
- Fill out an application for a business license.
- The articles of association and memorandum must get prepared.
- Decide a physical location for your business.
- Fill out the application form and bring your business proposal to the meeting.
- Obtain government approval before registering your firm and submitting a licensing application.
Freezones Company Limitations in UAE
There are endless benefits when you open a company in the UAE Freezone. However, there is always some sort of limitations associated with any type of company formation whether in Dubai or any other part of the world.
- A freezone company is now permitted to trade and do business with the UAE market.
- Freezone businesses can work across local businesses only through the locally sponsored person or employed distributors.
- Freezone companies cannot work on the mainland.
- Businesses that operate in freezones do not usually have a branch office.
- Opening a company in Dubai freezones will limit you to rent an office. You will have to rent an office only in the chosen jurisdiction.
Types of Freezones in UAE
In a free zone, three major types of businesses can be conducted including:
- Free Zone LLC Company (FZ LLC)– with a maximum of 50 shareholders.
- Free Zone Establishment (FZE) – is a limited liability company owned and operated by a single shareholder.
- Branch Company – it must be a local branch or franchise of a local or foreign company.
Why to Open a Free Zone Company in Dubai?
There are typically three jurisdictions in which you can operate your company based on your business activities. Each jurisdiction comes with significant benefits and opportunities for the companies.
A company with a business activity to provide services within the free zone or trade within the free zone or to provide services outside of UAE or trade outside of UAE, in such a scenario, the ideal situation for the investor is to opt for a free zone company setup. A free zone company enables you to enjoy 100% ownership of the business, 100% repatriation of the business, 100% exemption from import and export duties and other countless benefits.
How Avyanco Can Help You Open a Freezone Company in UAE?
Since there are various options available when deciding to start a company in UAE freezone, choosing the best one might be a daunting process. However, an experienced business setup consultancy can help you select the best jurisdiction for your company formation.
Avyanco is the leading business setup advisory helping hundreds of investors to successfully start their businesses in Dubai, UAE. Team Avyanco will take care of all the procedures and requirements to make the process smooth. From visa application to selecting a business activity to choose the best jurisdiction to swift execution of your business, we will be there for you.
Feel free to get in touch with us!