Free Zone
Setup your business in Free Zone
Benefits of Free Zone business setup in dubai
- Companies in Free Zone are exempted from Corporate tax, Personal tax and Income tax.
- Foreign investors can have the absolute ownership of their company.
- Free zones do not have foreign exchange restrictions.
- Easy and low-cost employee recruitment process.
- Investors have the benefit of complete profit and capital repatriation.
- Free zone companies are exempted from export and import charges.
- Free zone companies enjoy low logistic costs.
- 3-year UAE residence visa.
- Free zones do not have restrictions on hiring expatriates.
Steps to set up a Free Zone business
Free zone authorities require minimum paperwork and duration. Here are the key steps to set up a business in a free zone.
Step 1 # Determine the type of legal entity. In a free zone, you can set up one of the two types of companies:
-
- Free Zone Limited Liability Company (FZ LLC) or Free Zone Company (FZ Co.)
- Free Zone Establishment (FZE)
Step 2 # Choose a trading name.
Step 3 # Apply for a business license. The type of business license you will apply for depends on the primary activity of your business.
Step 4 # Choose an office space
Step 5 # Get pre-approvals, then you need to pay registration fees and license fees. The fees depend on the type of license required. Lease agreements will be prepared by the authority; then a trade license will be issued, and Visa processing will start.
Determine Capital Requirement For Your Business
- Determine capital requirement. There is no minimum capital requirement at twofour54 Abu Dhabi.
- In KIZAD, you can form an LLC for which the minimum paid-up capital should be AED 150,000.
- In Dubai Airport Free Zone, you can form an FZ Co. with a minimum share capital of AED 1000. Each share should be in the denomination of AED 1000.
- In DMCC, the minimum share capital for forming a free zone company is AED 50,000 per company and AED 10,000 per shareholder. For a company to be issued a General Trading Licence, it should have a minimum of AED 1 million share capital.
- In Hamriya Free Zone, you can form an FZE with a share capital of AED 150,000.
Types of Legal Entities
There are two types of legal entities in Free Zone jurisdictions, which listed as follows:
-
- Free Zone Limited Liability Company (FZ LLC) or Free Zone Company (FZ Co.) Generally requires 2 or more shareholders. Maximum of 5 shareholders.
- Free Zone Establishment (FZE). FZE has a single-shareholder (either an individual person or a company)
Both offer extremely similar benefits in terms of business operation. However, there are differences in share capital requirements depending on individual Free Zone requirements and the purpose of the corporation.
Types of Business Licenses
1. Commercial/trade license
This license is for the entities that conduct trades for all types of products, such as digital appliances, clothing, food, etc. If your business is about export, re-export and import, this is the license you need.
2. Consultancy/services license
This license is for companies that provide professional services which are conducted by qualified and skilled personnel such as consultants, photographers, content writers, designers, etc.
3. Industrial license
This license is for businesses that use natural or artificial materials to process and package products.
4. Warehousing license
This license is for businesses that lease warehouses for distribution & storage.
5. Manufacturing license
This license is for companies that use raw materials to produce finished goods. Such as textiles, digital products, auto mobile, etc.
How to Choose an Office Space
- You can either buy or lease office spaces in free zones. Office requirements depend on the number of employees and type of business activity of your company.
- In DMCC, you can choose from a flexi desk of 20-30 sq. m., a flexi office of 200-265 sq. m., or offices running through multiple floors totalling up to 2,000 sq. m. each.
- In Dubai Airport Free Zone, you can choose between ‘Office Packages’, ‘Smart Desk Office Packages’ and ‘Executive Office Packages’.
Requirements for Trade Name
- must not violate the public morals or the public order of the country
- must be followed by the legal form of the company, for example (LLC, FZE, DMCC etc.)
- has not been previously registered
- is compatible with the required type of activity and legal status
- should not contain names of any religion, or governing authority, nor names or logos of any external bodies.
Documents Required For License and Business Setup
- License application form
- Business Card of the contact person of the business
- Shareholders and the appointed manager’s passport copies, address proof and business profile
- Business plan
- Memorandum and Articles of Association (Notarised and attested)
- Board Resolution appointing Manager/Director (Notarised and attested)
- Bank certificates and letters
Where will be the Best Choice?
There are over 50 free zones in the UAE. There’s no doubt a lot of information to review and much to consider when deciding which free zone best suits your specific business requirements, including location, price, business type, Flexi-desk or office space options, auditing, and much more.
The TXTK team designed a form, walking you through it step-by-step, steering you in the right direction, saving you money, and giving you a general idea of where setting up your company is best.
DMCC- Dubai Multi Commodities Centre
Created in 2002, Dubai Multi Commodities Centre (DMCC) is the UAE‘s largest free-trade zone. It is located in the Jumeirah Lake Towers district of Dubai. DMCC was voted the top global free zone for four consecutive years by the Financial Times FDi magazine.DMCC free zone is currently the base for almost 18,000 companies representing 180+ countries and 20+ business.
Almost every business activity you can think of can be found in DMCC. You can set up as a branch, subsidiary or new limited liability company and benefit from our advanced and flexible company regulations allowing different classes of shares, and multiple license activities under the same license, or even multiple licenses under the same company. And if you are unsure of what license or activity best suits your business, our experienced business setup executives will help guide you during our free consultation session.
License
TRADING LICENSE
Facilitates the buying and selling and import and export of goods from, to, and within the UAE. Specific license activities are to be selected by the company to match the goods they intend to trade in.
SERVICE LICENSE
Facilitates the rendering of services in all sectors such as professional, legal, financial, media, technology, education, energy, and healthcare. Also covers representative offices of foreign companies, holding companies, family offices, as well as retail activities such as restaurants & cafes.
INDUSTRIAL LICENSE
Light manufacturing in dedicated facilities within the Free Zone. Available for precious metals & stones and jewelry; and for Coffee & Tea related activities (blending, packaging, roasting, storage…etc.)
Dubai Airport Free Zone
DAFZ enables the following types of company formations:
- Free Zone Company (FZCO), which is a limited liability company that can operate within the free zone, or a branch of an existing company. It is in the free zone area of the region, adjacent to the Dubai International Airport, Dubai, UAE.
- Branch of an existing foreign company in Dubai Airport Freezone with no unique requirements for a share capital.
- Subsidiary company – A foreign company that can own 100% shares of a Dubai Free zone company.
DAFZ is home to more than 2,000 registered businesses from over 20+ sectors and various industries with 20,000+ professionals. DAFZ was established in 1996.It allows international investors a completely duty-free business setup and execution of services, along with complete foreign ownership and no currency restrictions.
License
The following licensing options for company incorporation are offered to the companies willing to set up their businesses at DAFZ:[2]
- Trade License: It allows the company to conduct trading activities like Import, export, distribution, and storage of products.
- Service License: A license tailor-made for service catered businesses. Example: IT Services.
- Industrial License: For carrying out light manufacturing, industrial activities, packaging, and assembling.
- E-Commerce License: For conducting trade of goods and services over the internet.
- General Trading License: For trading in general items including import, export, re-export, storage, and distribution
- Dual License with the Department of Economic Development (DED): This allows DAFZ companies to apply for a DED license without a physical office space in the mainland, operating outside of DAFZ’s premises.
CCDDP SILICON OASIS FREE ZONE
Dubai Silicon Oasis is a globally recognized free zone and an integrated technology park that allows people to live, work, and play. Hosting modern technology based industries and an urban master-planned community in an iconic location, DSO offers state-of-the-art infrastructure and in-house business services
License
Service Licence
- This allows the registered entity to carry out only specified services.
Trade Licence
- This allows the registered entity to practice activities that are related to the import, export, and distribution of items and goods as specified in the license.
Industrial License
- This allows the registered entity to import raw materials, manufacture, and process, assemble, package, and export the finished product.
Promotion
- 3 VISA QUATO LICENSE FEE 18,900 AED
- IMMIGRATION CARD 2,000 AED
- PARTNER VISA 6,500 AED
- EMPLOY VISA 5,800 AED
- SERVICE FEE FOR VISA 735 AED
