by: LuciaPosted on:

The Full Guide to UAE Freezone Company Formation

UAE freezone is an excellent place to start a business when an entrepreneur requires an international market, tax benefits, and does business with eased practices. A freezone company setup in UAE allows full foreign ownership, ease of registration process and cheap operations. In addition to that, it provides access to international infrastructure and foreign markets. This is a step wise procedure that will outline all that is needed in a freezone company formation in the UAE.

What is UAE Freezone Company Setup?

The UAE freezone company formation gives business entrepreneurs a chance to own their company in full without the involvement of a local sponsor. Freezones are identified areas which are chosen as business territory and provide such fantastic benefits like tax free environment, simplified administrative procedures and top quality infrastructure. The zones are developed with a purpose to attract foreign investment and serve several industries.

Principal Benefits of UAE Freezone Company Formation

  1. Full Foreign Ownership – Freezone companies do not require a local partner, as opposed to mainland enterprises.
  2. Tax Benefits – Freezones enjoy zero corporate tax, zero personal income tax and VAT exemptions under certain circumstances.
  3. Easier Business Formation- There is simplification of registration and licensing with minimum documentation.
  4. Free Repatriation of Profits -There are no limits on the repatriation of profits or capital less abroad.
  5. World-Class Infrastructure – Freezones have world-class office space facility, warehouses, and logistic support.
  6. Strategic Location – UAE is strategically located to form a perfect choice as a destination in international trade and business development.

The Process of Establishing a Freezone Company in UAE

Setting up a business in one of the UAE freezones is very easy. To register without any difficulties, follow these steps:

1. Select the Right Freezone

Each freezone in UAE is specialized in some industries. The most important thing is to select the best one:

  • Research different freezones on the basis of your business field.
  • Consider infrastructure, laws and industry focus of each freezone.
  • Look at set up charges and growth possibility.

2. Select the Business Activity

  • Select your business type (e.g. trading, consultancy, manufacturing).
  • Different licenses can be offered by the various freezones like commercial, service, or even industrial licenses.
  • Ensure that the freezone you have chosen supports your business operation.

3. Select Company Structure

  • Freezone Establishment (FZE) – Appropriate to single owners.
  • Freezone Company (FZC) – Suitable to more than one shareholder.
  • Branch of an existing company- Appropriate to international companies to extend to UAE.

4. Obtain a Business License

  • Sign up to get a license by business information.
  • Select the proper kind of license (commercial, professional, industrial).

5. Register the Company Name

  • Choose a business name that is not similar to other businesses according to the laws of UAE.
  • Ensure that the name is acceptable to your business activity.

6. Hand in Required Papers

  • Copy of passports of owners and directors.
  • Elaborate business strategy.
  • A No-Objection Certificate (NOC) of the current employer in case it is necessary.

7. Get Approvals and Fees

  • Submission of the documents to the freezone authority to get approved.
  • Pay registration fee and licensing fee where required.

8. Office Space Rent

  • Freezones expect a business to possess a registered address.
  • Flexi-desks, shared offices, private offices, or warehouses: pick one according to your requirements.

9. Create a Business Bank Account

  • Choose one of the UAE banks that best fits your business.
  • List requisite documentation, such as your trade license and company registration information.

Top Freezones to Setup Business in UAE

  1. Dubai Multi Commodities Centre (DMCC)
  • Suits best as a trade, commodities and financial business.
  • Provides high-end infrastructure and networking.
  1. Jebel Ali Free Zone (JAFZA)
  • Best fits logistics, e-commerce and manufacturing businesses.
  • Situated close to the Jebel Ali Port hence best suited to international trade.
  1. Abu Dhabi Global Market (ADGM)
  • Focus: professional and financial services.
  • Has approved alien business laws and thus most inviting to a foreign investor.
  1. Sharjah Media City (Shams)
  • Best fit: media, advertising, and creative industries.
  • possesses cheap set up packages consisting of ultra modern facilities.
  1. Ras Al Khaimah Economic Zone (RAKEZ)
  • Best suits start-ups, industrial organizations and freelancers.
  • Cheap set up and easy business solutions.

Documents Required to Setup Company in Freezone

Required Documents

  • Copies of passports of the business owners and directors.
  • Filled business registration application form.
  • Business plan on description of operations of the company.
  • Specimen signatures of authorized individuals.

Optional Documents (where needed)

  • Current No Objection Certificate (NOC) of the sponsor.
  • Articles of Association (AOA) and Memorandum of Association (MOA) (where needed).
  • Office space lease.

Cost of Setting Up a Freezone Company in UAE

Business setup in a freezone of the UAE will cost you differently depending on the freezone, type of business and office space. The noticeable expenses are:

  • Registration Fees- One off company registration fee.
  • License Fees – Trade license annual fee.
  • Office Rent -Rental is dependent on the kind of office (flexi-desk, shared, private).
  • Visa Fees – Fees payable by the business owner, employees and dependents.

The most frequent Freezone Company Setup Mistakes to Avoid

  • Selecting the Inappropriate Freezone – Select a Freezone that meets your business goal and industry.
  • Disregard Freezone Laws- Ensure that you comply with UAE business law.
  • Lack of Future Expansion Consideration – Choose a freezone that has long terms prospects.
  • No Business Plan – A proper plan will help in easing the approvals and funding.
  • Last minute Visa Applications – It is advised that one applies well in time to receive a visa to avoid inconveniences.

Conclusion

The procedure of establishing a freezone company in UAE is very lucrative and simple. Tax exemptions, full foreign ownership and world-class business infrastructure are enjoyed by the entrepreneurs. When analysed startups choose the right freezone, go through the proper registration procedure, and focus on adhering to business laws, they are eventually able to succeed in the long term. Establishing a freezone company in UAE offers a solid platform to develop, expand globally and become successful in business.