The United Arab Emirates Free Trade Zones (FTZs) are an attractive destination for foreign investors, as these designated areas are exempt from the UAE's mainland taxes and reduced bureaucratic requirements. Employment and import-export restrictions on business don't apply either in FTZs.
Although setting up a business in one of the UAE's free trade zones looks attractive for foreign investors, in-depth market knowledge is required to choose a free trade zone that suits your business needs.
We can recommend the right Free Zone depending on your business environment, the visas and offices you need, and your investment budget. Our experts can help you choose from over 40 FTZs. Contact us today for advice on setting up a company in UAE Free Zones.
ADVANTAGES OF BUSINESS SETUP IN UAE FREE ZONES
SELECT A LICENSE TYPE AND BUSINESS ACTIVITY
Each Free Zone has different rules for the number of activities you can add to one license. However, the general rule for all the Free Zones is that no commercial activity can’t be mixed with service activities in one license. Thus, anything to do with trading must be in a Trading/Commercial License, and providing services or consultations must be in a Service License. In addition, you will require an Industrial License if you plan to produce or manufacture anything.
CHOOSE A FREE ZONE
Each UAE Free Zone has its list of allowed activities that can be performed within the particular Free Zone; types of available facilities and visa quotas can also vary from one Free Zone to another. That’s why it is highly recommended to get a professional consultation at this stage to choose the best Free Zone for your business.
SELECT A CORPORATE STRUCTURE
The corporate structure can be one of the following: a New Company with individual shareholder(s), a Subsidiary Company (with corporate shareholder(s)), a Joint Venture Company (a mix of the individual and corporate shareholders), a Branch of a Local or a Foreign Company. Some business activities are allowed only for Branch Companies; therefore, you should check them with a Free Zone.
SELECT TRADE NAME & PREPARE DOCUMENTS
You must prepare three versions of your company name in order of preference and enclose a list of documents that are required for the Free Zone of your choice. A standard list of documents for starting a new company includes a passport, visa, EID (if applicable), NOC for UAE residents (for specific free zones), proof of address, and a professional CV. However, remember that the documents for registering a company branch may vary slightly.
APPLY FOR INITIAL APPROVAL
Initial approval usually includes approval for the company name, the chosen business activity(ies), and the proposed company structure.
SIGN LEGAL DOCUMENTS FOR COMPANY INCORPORATION
After the initial approval, a face-to-face meeting (or video call) with a representative of the Free Zone should be arranged. In some cases you can skip this point if you have a power of attorney for your representative and all documents are notarized. The meeting is for the purpose of checking Shareholders'/UBOs' passports and signing documents such as Articles of Association (AOA), Board Resolution, and Specimen Signature Forms.
ESTABLISH BUSINESS LOCATION
The final licensing stage involves selecting a commercial property for your company in the Free Zone of your choice. You need to sign a lease agreement for a minimum of 1 year and obtain an Ejari certificate. The lease agreement and the Ejari certificate are submitted to the free zone and on the basis of these documents you are issued a license with the address from the lease agreement. Depending on the type of property (flexi-desk, business center office, physical office, warehouse, retail space), you may need a number of additional documents: e.g. AOFC certificate from Concordia or third-party liability insurance.
COLLECT BUSINESS LICENSE
Once the registration documents are signed, all approvals are obtained, and all payments are made. The license will be issued along with other corporate documents.