Business Setup In UAE Free Zone
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UAE free zones are one of the most attractive destinations for organizations and entrepreneurs from across the globe. A tax- friendly structure, top- of- the- line infrastructure, opportunities for 100% ownership, and streamlined processes make UAE Free Zones a top destination for doing business. Business setup in any one of the 45 free zones in the kingdom is heaven for businesses looking forward to investing and working at a place that offers numerous benefits like no currency restrictions, first class infrastructure, and access to full profits to name a few.
Irrespective of the fact that you are a well-established brand, or just a startup trying to turn your innovative idea into reality, Free Zones cater to various industries with unparalleled benefits and freedom of operation, which makes free zones a destination of choice for businesses from all over the world. This step-by-step guide will list in detail about everything you wish to know about business setup in UAE free zone. You will know about company setup in UAE, the different types of trade licenses, business activities, and the benefits of setting up a business in a free zone, and the documents and paperwork required for successful registration and operation of your business.
Benefits of Free Zone Business Setup in UAE
Just think of a business environment where you have infrastructural facilities at par with the best in the world, full access to your profits, the freedom to own 100% of your business and incredible tax benefits. It may sound too good to be true, but this is what UAE free zones are all about. Free zone company setup in Abu Dhabi, UAE can be accomplished in as little as 48 hours, making it one of the fastest zones to establish and operate a business. Apart from the numerous benefits enumerated above, let’s look at a few of the important benefits offered by Free Zones in the UAE in comparison to a mainland setup in the kingdom.
Types of Companies in UAE Free Zones
There are over 45 free trade zones currently in the UAE with more under construction. Each free has its governing authority called the Free Zone Authority (FZA), and businesses operating in that free zone are governed by that specific Free Zone Authority (FZA), which is entrusted with the task of issuing licenses and formulating regulations for businesses operating in that free zone. The primary attraction, among other benefits, of businesses operating in a free zone, is that there is no restriction placed on foreign ownership. To put it in simple terms, businesses operating in free zones can have 100% ownership of their companies. Also, a business operating in a free zone is not subject to UAE Commercial Companies Law.
There are primarily two company types in the UAE Free Zone— Free Zone Establishment (FZE) and Free Zone Company (FZCO).( FZ- LLC). Apart from these two, there are also Branches of a Foreign Company, and a Branch of a UAE Company. Before Free Zone company formation in UAE, it is important to know in detail about all these types of companies in the UAE Free Zone.
Free Zone Establishment (FZE)
A Free Zone Establishment(FZE) is a company structure with a single shareholder, who can either be a single individual(person) or a corporate shareholder. This type of establishment is most preferred by individuals or businesses who are interested in the UAE free zone business setup with limited liability and a higher degree of operational flexibility.
Free Zone Company (FZCO)
This structure allows for multiple shareholders or a partnership Free Zone firm where the number of shareholders ranges from 2 to 50. FZCOs are often preferred by a group of shareholders or larger businesses interested in sharing ownership in the business. There is also Free Zone Limited Liability Company (FZ LLC) where ownership is divided between multiple shareholders.
Types of Trade Licenses in UAE Free Zones
Firms interested in UAE free zone business setup should be aware of the different types of trade licenses awarded in the UAE free zone. There are generally four types of UAE free zone trade licenses – General Trading License, Commercial License, Industrial License and Service License. We discuss them in detail here.
Commercial License
A commercial license is required by businesses selling their products and services within the local borders as well as in international markets. This license facilitates economic activities such as importing goods and selling them in the UAE, or exporting them outside the UAE. A commercial license is also needed for indulging in trading activities within the confines of the free zone.
Industrial License
The regulating authority of a particular free zone is responsible for issuing industrial license for businesses operating in that free zone. This license is issued for manufacturing activities within the concerned free zone. The license, generally issued to manufacturing companies is required for importing raw materials from outside the kingdom and exporting finished goods.
General Trading License
With a general trading license, a business can indulge in various business-related activities such as import and export as well as re-import of goods; sale and distribution of different goods and services, and storage of various goods. The license offers a business the flexibility to carry out trade in an extensive variety of goods, all with a single license.
Steps to Free Zone Company Formation in the UAE
Free Zone business setup in UAE is a structured process, which an entrepreneur may seek to accomplish within one to four weeks. Qualified business setup consultants in UAE free zone can guide you through this process.
Documents for Setting Up A Free Zone Business In UAE
Investors interested in Free Zone Company Formation in UAE can either opt to form a Free Zone Establishment (FZE) or a Free Zone Company (FZC). It is important to note that the primary difference between an FZE and an FZC is that an FZE has one shareholder, whereas a FZC can have between 2 to 50 shareholders. Businesses with a parent office in Dubai or abroad can also open a branch office in the free zone.
An FZE or FZC is a limited liability company governed by rules and regulations formulated by the governing authority of the free zone in which it is established. As such, the UAE Commercial Companies Law (CCL) do not apply to these businesses.
For UAE Free Zone business setup in Dubai, we need to keep handy the below- mentioned documentation:
► An attested copy of passport of shareholders and managers and UAE Visa/UAE entry stamp (only for foreigners)
► Passport-sized photos of managers and shareholders also need to be submitted
► Documents related to your proof of address, which should not be more than three years old.
► Reference letter by a bank or some other professional reference.
► Curriculum Vitae containing details of your past professional work.
► Company Application Form
► No Objection Certificate(NOC) issued by the current sponsor in case the shareholder has a UAE residency visa.
It is also important to note that some UAE Free Zones may demand a detailed business plan containing your professional history, details of your proposed business venture and sundry other details.
Once the business is legally established, the next step is to lease land for operations, and subsequently get an operating license from the concerned Free Zone Authority. Please note that different types of licenses are issued by different Free Zone Authorities. Moreover, a business operating in a free zone can only do business either within the free zone or the international market. To offer their goods and services on the mainland, they need to hire a UAE official agent and form a joint venture.
Why Choose Dubai Firmz for UAE Free Zone Business Setup?
Free Zone Company Formation in UAE is a streamlined and structured process. Top- of- the- line Business setup consultants in UAE Free Zone like Dubai Firmz offer invaluable assistance to organizations looking up to set a business in Sharjah Free Zone. As a foreigner, it can be incredibly tough for you to identify all the different types of licenses and permits that are available for different types of businesses. Also, it can be tough to prepare all the paperwork and documents in a foreign country. It is the reason it is strongly recommended to hire the services of a well-known and well-established specialist so that you can set up your business without any hassles by arranging all the licenses and meeting all the regulatory requirements you need to fulfill for your chosen business.
As the leading corporate service provider in the UAE, Dubai Firmz can help you start your company in one of the many Free Trade Zones in the UAE with utmost ease.
Also, it is important to note that establishing a business in a UAE Free Zone requires careful financial planning and a good understanding of all the costs involved. UAE Free Zone business setup cost depends upon a lot of factors such as the Free Zone you wish to operate in, the nature of your business, the type of license required and the scale of operations among others.
First and foremost, there is a trade license fee with different fee structures depending on whether you want a trade license, industrial license, or service license. UAE free zone business setup cost also includes company registration fee along with operational expenses, office rent, utilities expenses in addition to taxation, and professional and legal fees among others. Dubai Firmz well aware of the Kingdom can help you with your cost management so that you do not suffer additional fines or penalties and obtain your license within your budget. With the right license and the office space along with other requirements, Dubai Firmz ensures you are well-positioned for future growth and success.
Get in touch with us today to ensure that your business setup in Ajman Free Zone is smooth, compliant, and set up for success.
To start a new business in the UAE free zone, you need to seek and acquire the right trading license from the concerned Free Zone Authority (FZA). The scope, type and size of your business activity and the Free Zone you operate in will determine the type of trade license you will need along with all other documents.
The cheapest Free Zone setup in the UAE is probably Sharjah Media City, otherwise known as SHAMS. The starting cost is probably around AED 6,000 for a business license. For more information and help, you can get in touch with a good business setup consultant in UAE Free Zone.
Yes, of course. One of the major advantages of establishing a business in a UAE Free Zone is that it allows for 100% ownership. It means you do not need a local sponsor.
Business setup in Dubai Free Zones can be accomplished within 48 hours. However, the average time for establishing a business in the UAE Free Zone is between two to four weeks depending upon the scope, nature, size and complexity of the business and the type of license required to run it.
The process is pretty straightforward. You need to gather the requisite documents, submit them on time, pay the necessary fee and then wait for approval from the concerned Free Zone Authority (FZA).
