Dubai Freezone
Launching a business in one of Dubai's Free Zones presents a highly appealing option for investors, thanks to various advantages such as complete foreign ownership and significant tax benefits. Below are the essential steps and requirements for setting up a company in a Dubai Free Zone:
Dubai features over 30 Free Zones, each designed for specific industries or business activities. Notable Free Zones include:
- Dubai Multi Commodities Centre (DMCC)
- Jebel Ali Free Zone (JAFZA)
- Dubai Silicon Oasis (DSO)
- Dubai International Financial Centre (DIFC)
- Dubai Airport Free Zone (DAFZA)
- Dubai Media City (DMC)
- Dubai Internet City (DIC)
It is crucial to select a Free Zone that aligns with your intended business activities.
Each Free Zone maintains a list of approved business activities. Ensure that your selected business activity aligns with the permitted operations within that Free Zone. Options range from trading, consulting, and technology to logistics and manufacturing.
Dubai Free Zones provide various company structures, including:
- Free Zone Establishment (FZE): A company with a single shareholder.
- Free Zone Company (FZCO or FZC): A company with multiple shareholders.
- Branch Office of a Foreign Company: A local extension of an existing company based outside the UAE.
Certain Free Zones impose minimum capital requirements depending on the nature of the business and the chosen legal structure. For instance:
- DMCC requires a minimum share capital of AED 50,000 per shareholder.
- Other Free Zones may have lower or no minimum capital mandates. It’s essential to check the specific requirements for your chosen Free Zone.
Free Zones provide various office solutions, including:
- Flexi-desk or Smart Desk: Ideal for startups and freelancers.
- Shared Offices: Suitable for small businesses.
- Executive Offices or Warehouses: Designed for larger businesses needing substantial physical space.
The type of office selected will influence the number of visas your company can apply for.
Select a distinct trade name that complies with the naming conventions of the Free Zone. The chosen name must not be similar to existing businesses and should avoid offensive or religious connotations.
Required documentation can vary depending on the Free Zone and the business type, but generally includes:
- Passport copies of shareholders and managers.
- Visa copy (if applicable) for UAE residents.
- Proof of residence (e.g., utility bill).
- Business plan (if mandated by certain Free Zones).
- Confirmation of trade name reservation.
- Initial approval form from the Free Zone authority.
After submitting the necessary documents, the Free Zone authority will issue initial approval, enabling the company to advance to the registration phase.
The final step is to apply for the relevant business license, which could include:
- Trading License: For importing, exporting, or distributing goods.
- Service License: For consulting or service-based businesses.
- Industrial License: For manufacturing or production activities.
- E-Commerce License: For online trading or digital services.
Following the company’s establishment, you can apply for residency visas for shareholders, employees, and dependents. The number of visas allowed correlates with the type of office space chosen.
Once registered, you can open a corporate bank account in the UAE. Typical required documents include:
- Company’s trade license.
- Shareholder resolutions.
- Memorandum of Association (if applicable).
- Passport copies of shareholders and managers.
Advantages of Dubai Free Zone :Company Formation
- 100% foreign ownership (no need for a local partner or sponsor).
- 0% corporate tax and personal income tax.
- Complete repatriation of capital and profits.
- No customs duties on imports and exports within the Free Zone.
- Streamlined visa processes for employees and dependents.
- No currency restrictions (business can be conducted in any currency).
- Full ownership of intellectual property and trademarks.
Commonly Required Documents for Free Zone Company Formation:
- Passport copies of shareholders and managers.
- Proof of residence (e.g., utility bill).
- Visa copy (if applicable).
- Trade name reservation certificate.
- Initial approval from the Free Zone authority.
- Memorandum of Association (for multi-shareholder companies).
- Bank reference letter (in some Free Zones).
- NOC from the current employer (for UAE residents switching sponsors).
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