Free economic zones are unique areas that are regulated by specific internal laws and taxation rules. There are about 40 FEZs in the United Arab Emirates to choose from. While most of them are located in Dubai, you will also find free zones in Abu Dhabi, Umm Al Quwain, Ajman, Fujairah, Ras Al Khaimah, or Sharjah. A company set in the FEZ can be fully owned by a foreigner. You will not have to pay any taxes on your income worldwide or the profit you derive from similar companies in the free zones. A FEZ company can be registered without a local agent, while you need one to set up a business on the mainland. What is more, establishing a company in a FEZ entitles you to a UAE resident visa for yourself and your staff. Interested in more detailed information? You will find a full guide on free zones in the United Arab Emirates on a trusted portal where you can also get free professional advice.
Why Opt for the Free Economic Zones in the Emirates?
Let’s look at the main benefits associated with UAE’s free zones:
- UAE is a country characterized by economic stability and a high reputation in the world of business, which will help your company grow internationally at a tremendous speed.
- As FEZs are engaged in fierce competition to attract more foreign entrepreneurs, they offer top-notch facilities and services to newly registered companies.
- The company’s owners, founders, or managers are under no obligation to be local residents: they can be non-resident individuals or legal entities.
- You are not limited to working with customers and partners from the FEZs or other countries. If you want to work with mainland UAE, you can obtain dual licenses or work with a local agent.
- A FEZ company is entitled to open a bank account in the UAE and repatriate profits without any limitations.
- UAE companies have different corporate income tax rates depending on their income and status. Qualified FEZ companies with qualified income or non-qualified FEZ companies with profits not exceeding AED 375,000 a year pay zero tax. A regular non-qualified FEZ company whose profits are more than AED 375,000 a year is liable for a 9% corporate income tax.
- There are special free zones for importers where they will not be liable for VAT if they import products to the UAE or move them between FEZs.
- There are FEZs that allow the re-domiciliation of foreign businesses. That is, if you are not satisfied with the business environment in your current country, you can easily move your company here.
Companies established in UAE’s free economic zones are required to have an office. It may be a full-fledged office or a dedicated workspace depending on the nature and type of your business. Freelancers or small startups usually take advantage of a virtual option (flexi-desk).
Free Economic Zones in Dubai
Dubai is rightfully considered to be the most popular emirate for entrepreneurs and investors as it generates the highest profits in the country. Business people from across the globe flock here to easily set up any business or obtain the licenses they need.
In 2023, an initiative called Dubai Unified License (DUL) was launched. It is expected to simplify the licensing procedure by creating a digital registry for all businesses, including those registered in FEZs. Local authorities will benefit as well as they will be able to obtain information about a particular company from a single source.
And now let’s take a look at different free zones available in Dubai.
Dubai South Free Zone
- You can set up an LLC or a branch office here.
- The company registration process takes from 2 to 4 weeks.
- You can get a logistics, industrial, service, educational, or trading license.
- Financial/investment activities conducted on behalf of third parties are prohibited.
- Permitted industries include education, hospitality, trade, aviation industry, and IT.
Jebel Ali Free Zone (JAFZA)
This is the largest FEZ in Dubai that works with various business sectors. Here are some of its peculiarities:
- You can register a company in a matter of 3 to 4 weeks.
- You can acquire a manufacturing, service, or trading license.
- The amount of the authorized capital is determined by the company owner.
- You can establish a subsidiary, a branch office, or a new company.
Meydan Free Zone
- The LLCs registered here are required to have a minimum capital of AED 100,000.
- Audits are required to be conducted on an annual basis.
- Company setup procedure will take from 7 to 10 days.
- You can obtain a professional, manufacturing, or trading license here.
- The activities you can engage in include export, import, consulting, trading, commerce, or media businesses.
Dubai Internet City
This is an information and communication technology park you can take advantage of:
- You can set up a branch office or an LLC here.
- A company can be registered within 30 days.
- There is no minimum authorized capital threshold set.
- You can acquire an IT service, multimedia, Internet, e-commerce, network, telecommunications, or software license here.
- The permitted activities in Dubai Internet City include e-commerce and IT.
Dubai Airport Free Zone
- The minimum authorized capital is set at AED 1,000.
- You can establish a branch office or a FEZ company here.
- A company can be registered in a matter of 20 days.
- You can acquire a service, industrial, or trading license here.
Dubai Technology Entrepreneur Campus
- The minimum authorized capital threshold is AED 10,000.
- You can get an operational license here (industrial, trading, or service ones) or a special license, which is actually a permit to carry out your activities in the government-owned free zone called the Dubai Silicon Oasis.
- IT, trading, technology, and some other activities are permitted here.
Dubai International Financial Center
- The company registration process lasts from 4 to 6 weeks.
- You are required to have a minimum authorized capital of AED 50,000.
- Partnerships, LLCs, and branch offices can be set up here.
- Permitted activities include insurance, capital management, banking and brokerage services, and so on.
Interested in UAE’s free zones? You can find a lot of other offers if you follow the above link. Each zone has its unique advantages and opportunities, so you are sure to find something to suit your needs. If you are in doubt, you will be able to use a live chat on the portal to ask questions or even book a free session with an expert.