If you’re thinking of starting a business and want to learn more about the advantages of establishing a Free zone business setup in the UAE, you’ve come to the right spot. Take a look at some important information about doing business in the UAE before learning about the benefits of forming a Freezone company in the UAE.
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What Are Free Zones in Dubai?
Free Zones are areas within a country where products, services, and commodities can be exchanged without having to comply with strict customs regulations. Companies are taxed minimally or even completely exempted in most Free Zones to promote economic development.
The Free Zones Operating in UAE
Since they are not allowed to operate in the rest of the UAE, free zones were created to serve as foreign business hubs for companies outside of the UAE. Most free zone companies were initially involved in import and re-export. Now, most of them are doing business within the UAE and the Gulf Cooperation Council through local distributors.
For foreign investors, establishing a business enterprise in one of the UAE’s Free Zones is an appealing choice. Free Zones promote business activities and attract a company setup looking to establish rapidly and effortlessly.
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The UAE’s Free Zones are geographically distinct sections with laws and regulations that are significantly different from those that regulate companies in the UAE. International companies or companies working outside the UAE are deemed to be operating in the Free Zones.
Free zones are special economic zones or jurisdictions that offer financial and tax exemptions to businesses in exchange for operating licenses. In total, the seven Emirates have over 40 free zones. The Free Zone Authority is the government agency in charge of a Free zone.
So, The Free Zone Authority, also known as the FZA, is the governing body responsible for the crucial activities related to free zone operations and license issuance.
In a UAE-free zone, an investor may form three types of business entities: listed below.
- Free zone company (FZC)
- Free zone establishment (FZE)
- Branch of a business concern
Each Free Zone in the UAE is governed by its own Free Zone Authority, which also manages registration and issues licenses. While there are differences in the Free Zones around the Emirates, the basic concepts are the same.
What are the Key Costs of Setup a Company in Dubai Free Zone?
Sometimes, Free Zones suggest that you can register for a low price, but the fact is that there is a range of mandatory costs that quickly add up.
There are five major costs to consider in any Free Zone:
- Trade Name Reservation
- Registration
- Trade License
- Office Rental
- Free zone Visas and other ancillary costs
There are two types of rates: one-time fees and recurring fees. Although the registration fees are relatively low, it isn’t easy to set up in any Freezone for less than 30,000 AED if all other costs are factored in.
Benefits of Free Zone Company Formation in Dubai
The establishment of a business in a UAE free zone has many advantages, including:
1. Complete Foreign Ownership
Enjoy full ownership of your company as a foreign investor.
2. Capital and Profit Repatriation
Easily transfer capital and profits out of the country.
3. Streamlined Setup Process
Experience swift and straightforward business establishment procedures.
4. Thriving Business Communities
Access well-established and vibrant business ecosystems.
5. Diverse Cost-Effective Options
Choose from a variety of business setups at competitive rates.
6. Tax Exemptions
Benefit from a 100% exemption from corporate and income taxes.
7. Customs Duty Waivers
Avail a complete waiver from customs duties.
8. Autonomous Legal Framework
Operate under independent laws and regulations.
9. Global Market Reach
Effortlessly access regional and international markets.
10. Modern Infrastructure
Operate within a modern and advanced business infrastructure.
Free zones in the United Arab Emirates have the most up-to-date connectivity networks and facilities. Energy is both cheap and available in free zones.
More than 50 free zones are operating in the United Arab Emirates, distributed across the seven emirates. This number is steadily increasing, with new free zones being developed every year.
The majority of free zones are designed to accommodate a specific form of enterprise. While the rules and laws that regulate most Free Zones are identical, the business climate and services can vary.
Here is a list of some of the best free zones in the UAE:
- IFZA (International Free Zone Authority)
- RAKEZ (Ras Al Khaimah Economic Zone)
- Meydan Free Zone
- SHAMS (Sharjah Media City)
These free zones offer various benefits and incentives for businesses, making them popular choices for company formation and operations in the UAE. Each free zone has its own unique advantages and industry focus, so it’s important to research and choose the one that aligns with your business requirements and objectives.
What is Free Zone License?
A Free Zone license serves as the essential authorization for conducting business activities within our designated free zone area. This license provides businesses of varying scales, encompassing startups, small and medium enterprises (SMEs), as well as major multinational corporations, with a range of advantages for establishing their operations in Dubai’s free zone.
How can I get free zone license in Dubai?
Acquiring a free zone license in Dubai involves these essential stages:
- Identify the suitable legal structure for your entity.
- Select an appropriate trade name for your venture.
- Initiate the application process for your business license.
- Opt for an office space that suits your requirements.
- Obtain pre-approvals, finalize your business registration, and secure your license.
How much is the free zone license in Dubai?
Initiating the process of establishing a Dubai free zone company starts with registering it with the appropriate authorities. The registration costs differ based on the selected free zone, typically falling within the range of AED 12,900 to AED 50,000. This fee encompasses the company registration and acquisition of essential licenses.
What are the requirements for free zone company in UAE?
- Complete the online pre-approval application form.
- Provide a copy of your passport.
- Present evidence of your residential address in your home country.
- Submit copies of documents related to the parent company.
- Obtain third-party approvals if your business activities fall under regulated categories.
Which is the cheapest free zone license in UAE?
In 2023, the most budget-friendly option for a free zone license in Dubai is provided by IFZA (International Free Zone Authority). IFZA extends a cost-effective company license within Dubai, priced at AED 11,900, and does not include visas. This stands as the most economical and advantageous Dubai free zone license offer for the current year.
How can Company Setup Consultants help You?
If you want to setup a business in Dubai Free Zones, you should conduct extensive preliminary research. An approved company registry agent can help you navigate the registration and start-up process, which can be time-consuming for beginners.
To Speak with our Experienced Business Consultants for further information and assistance, call us at +971582595164. Send a WhatsApp Message for Chat Query on +971 582595164 or email us at info@companysetup.ae.
