BUSINESS SETUP IN DUBAI FREE ZONE
WHAT IS FREE ZONE IN DUBAI?
A free zone is a segment of clearly defined and isolated land or setting, with a special tax, customs and imports regime, that is different from the mainland area (country) usually involving a status of extra-territoriality. Free Zones are planned for boosting international businesses through providing 100% ownership to expatriates and single window administration convenience. In UAE, free zones are either attached to ports or industry specific.
WHY TO CHOOSE FREE ZONE FOR BUSINESS SETUP
The main idea of establishing free zones in the UAE was for them to serve as a central business hub for companies willing to conduct business with the outer world, not specifically in the UAE. Therefore, UAE free zone companies are intended to operate within the corresponding free zone as a hub for the worldwide operations and are not licensed to operate within the rest of the UAE. As a result most of the free zone companies during the initial days were engaged in import and re-export activities. But today, a large majority of such free zone companies do business with their clients in UAE and GCC through their local distributors.
HOW TO BUSINESS SETUP IN DUBAI FREE ZONE?
The main idea of establishing free zones in the UAE was for them to serve as a central business hub for companies willing to conduct business with the outer world, not specifically in the UAE.
Therefore, UAE free zone companies are intended to operate within the corresponding free zone as a hub for the worldwide operations and are not licensed to operate within the rest of the UAE. As a result most of the free zone companies during the initial days were engaged in import and re-export activities. But today, a large majority of such free zone companies do business with their clients in UAE and GCC through their local distributors.
Each free zone in UAE has its own set of laws. However, most of the businesses in the Free Zones fall under the following broad categories based on their business activities.
- Branch of a foreign company (outside of the UAE) or a branch of an offshore company (subject to approval of the free zone authority) Free Zone Establishment/Company (FZE/FZC/FZ LLC)
- FZE or FZC are limited liability entities owned by an individual or corporate entity. There are slight differences between the entities. For example, Free Zone Establishment has only one single shareholder. Free Zone Company or FZ LLC can have 2 or more shareholders
Dubai over the last few decades has become the preferred choice for businesses to grow or expand their business. Not just the already established organisations, but also new entrepreneurs prefer Dubai to start their new ventures! The reason for this growing popularity is:
- Location
- Culture
- Economic policies
- Ease to operate and start a business
- Choice to select the best type of economic zone to give you maximum benefits
If you are a newcomer to the world of Dubai, by the time you have read this article, you would be aware of the benefits and steps to start your business in Dubai; especially in Dubai Free Zone – the most preferred economic zone.
A free zone is an economic zone or jurisdiction that is identified to exchange goods and services with superior import and export customs and other operational benefits.
We know reading the easy steps to establish your business in Dubai you are excited to start the journey. But before you do that let us share a few other benefits apart from the one, we shared above of easy and minimal steps to business setup in Dubai free zone.
- 100% foreign ownership.
- 100% tax-free and 100% repatriation of the profit earned – i.e., you can transfer or send the whole profits earned to your parent company.
- For all those businesses who need to transfer funds to say vendors or the parent company – there is no limit on funds transfer and no control over foreign currency exchange.
- Zero duties are levied on any kind of goods.
- Easy procedure while applying for a business license.
- Ample office spaces are available both for sale and rent.
- Application for visas for skilled workers is easy and affordable.
- No timing restrictions – your business can operate the offices 24*7
Below are some of the common documents required across the different types of free zones to set up a business in Dubai or the UAE.
RIC
The Registry Identification Code Form (RIC) and the business plan (original and notarized)
Passport Copies
Copies of business partners’ passports and color pictures
CV
CV (curriculum vitae) (summary of professional history)
License
Application license form.
RIC
Business Card
Plan Layout
Business Plan Layout
Plan Outlay
Business Plan Outlay
Banking
Banking reference and license of the partner’s existing business if required.
KEY HIGHLIGHTS OF BUSINESS SETUP IN DUBAI FREE ZONE
- 100% Foreign Ownership 100%
- Tax-free Income – No Corporate or Income Tax
- 100% capital transfer and profit repatriation
- Minimum documentation requirements
- Access to 3-Year Residence Visa and Multi-Year License
- No VAT is applicable for business transactions within the Free Zone – for selective free zones
- Access to world-class infrastructure facilities
- Most of the Free Zones have an in-house Customs Checkpoint to allow easy transit of goods
- Zero Customs Duty is levied on imports to the Free Zones.
- World-Class Warehouse facilities for storage, packaging & even light manufacturing
- Global connectivity and proximity to one of the busiest Airports and Seaports of the world – best for trading businesses. Ideal for networking and growing!
Smart Steps To Take Before You Setup a Business In Dubai Free Zone
Basis the business activity, i.e., whether you are a service provider, manufacturer, or trader, you must select the free zone.
Though Shakespeare said – “What’s in a name?”, we would say there is a lot that your name can do for you. For starters, it gives your business a face and recognition and works as a stepping stone to selecting a free zone and registering your business.
Based on the type of business, you would have to select the license type and to ensure that you fit the requirements for the specific free zone.
If you are a trader, you would heavily depend on the transportation and dealings near the port. Hence, it is ideal to select an office space according to your business requirement
Once you have completed all the other requisitions, you are now eligible to register your company and then apply for visas for yourself, your family, or the employees to be hired!
FREQUENTLY ASKED QUESTIONS
A freezone is a designated area where foreign companies can establish a business with simplified regulations and 100% ownership.
Freezones offer full foreign ownership, tax exemptions, and simplified business setup procedures, making them attractive for international entrepreneurs.
Yes, one of the key advantages of freezones is that you can have full ownership of your company without the need for a local partner.
Evergreen Businessmen Services will guide you through the application, documentation, and registration processes required for setting up your business in the chosen freezone.
Yes, the brand name should comply with the guidelines set by the relevant authorities. Evergreen Businessmen Services can provide assistance in ensuring your chosen brand name meets these requirements.
Typically, documents such as passport copies, business plan, and relevant application forms are required. Evergreen Businessmen Services will provide a detailed checklist based on your business activities.
The timeline varies but is generally efficient in freezones. Evergreen Businessmen Services can provide an estimate based on the specific freezone and business activities.
Evergreen Businessmen Services provides post-setup support, including assistance with visa applications, office space, and other services to help your business thrive in Dubai.
