Free Economic Zones in the UAE - a Successful Solution for Your Business
Contributed by OLIESERVE
17 March, 2015
The United Arab Emirates is a union of seven thriving Emirates of Abu Dhabi, Ajman, Dubai, Fujairah, Ras-al-Khaimah, Sharjah and Umm Al Quwain. As of today, there are about 30 Free Economic Zones (FEZ) in the UAE. They were established by Sheikhs to create additional jobs for expansion of the export of the country, as well as to give impetus to the development of latest technologies, which is clearly and obviously noticed in the richness of this country, its stable economy and political environment.
The possibility of registration of a company in the Free Economic Zones allows foreign investors an independent, 100% sole ownership and management of the company.
Key benefits of establishment of a company in the Free Economic Zone of the UAE:
- 0% income tax;
- 0% corporate tax;
- 100% ownership of foreign capital;
- 100% repatriation of capital;
- Absence of trade barriers and quotas;
- Simplified Import and Export policies;
- Registration of different types of companies; new companies, branches, representative offices;
- Founders can be any natural or legal persons of any country (with a small exception to residents of such countries as Israel and Iran);
- A full range of business activities;
- No restriction of hiring expatriates;
- Ability to acquire ownership or lease of commercial and non-commercial real estate;
- You specify the type of office; virtual or serviced;
- You are granted a UAE residence visa valid for a period of 3 years;
- Complete freedom in movement of finances;
- Instant company registration (24 hours)
- FEZ companies can be registered as offshore (activities conducted outside the UAE) and onshore (with presence in FEZ)
At the time of incorporation of the company, you are required to have an authorized capital of 50,000 dirhams (for example, in Dubai Multi Commodities Centre (DMCC)) up to 1 000 000 dirhams (e.g. in Jebel Ali Free Zone (JAFZA)). The amount of the capital depends on the type of license (activity) and the form of the company.
Classification of FEZ in global economy
Type of FEZ
Spheres of Interest
Located in major educational and research centers with a long tradition, which allow access to the International Market.
Located in areas with excellent infrastructure, close to road arteries and resource bases. These conditions allow significant reduction of the cost of manufactured products.
Located in all major Emirates. Placement of a company in such zones enables faster delivery of goods to the market and conduct profitable deals.
Zones with narrow specialization
All possible FEZs.
Types of Companies operating in FEZ:
Significant positive advantage of establishing a company / branch / departments is the possibility of complete (100%) ownership of shares by foreigners, whereas beyond 51% it must be owned by a local entrepreneur who will receive approximately 20% of annual profits. You will agree that your business will not reach desired results that fast.
Onshore companies are divided into three main types:
- Branch of a foreign company;
- Enterprise (Free Zone Establishment (FZE);
- An independent free zone company (Free Zone Company (FZCO)
The first free economic zone in the UAE appeared in 1985 on the territory of Jebel Ali. To date, there are more than 20 free zones in Dubai only.
The table shows a brief description of the most popular FEZ in UAE:
FEZ of Dubai Emirate
Dubai Airport Free Zone FEZ of Dubai Airport
Suitable for companies engaged in logistics and trade in high-value products that require rapid clearance and maintenance.
TECOM Investments FEZ
Includes eleven free zones - media, IT, design sector, manufacturing, education, scientific activities and medicine.
Dubai Multi Commodities Center FEZ «DMCC»
It is possible to execute all types of trading licenses at DMCC, including precious metals and stones. In certain cases, it is permitted to form smart-offices.
Dubai International Financial Center FEZ « Dubai International Financial Center »
This is a prestigious financial center. This is where you can get a license for banking, financial, insurance industry, asset management.
Economic Zones World Jebel Ali Free Zone FEZ «Jebel Ali»
Enjoys a convenient location close to the subway.
Dubai Silicon Oasis FEZ «Dubai Silicon Oasis»
A popular FEZ for registration of companies in the field of IT and high-tech engineering, as well as trade and consulting. Luxurious, yet cost-effective offices.
FEZ of Abu Dhabi Emirate
Masdar City Free Zone UAE «Masdar City»
Absence of bureaucratic red tape. Quick Company formation and obtainment of a residence permit. Oriented on services in different sectors of the economy.
Abu Dhabi Airport Business City FEZ of Abu Dhabi Emirate
Located in the vicinity of Abu Dhabi Aiport. Ideal for logistics and cargo, as well as other services. It is permitted to form a smart-office.
FEZ of Northern Emirates
RAK Free Trade Zone FEZ «RAK»
One of the budgetary FEZ to open a trading business, provision of services and production. The minus is its location far from Dubai.
Ajman Free Zone FEZ «Ajman»
The cheapest FEZ. It is extremely advantageous for opening a trading, consulting and manufacturing company. A successful logistics network strategically located at the gates of the Persian Gulf. Possibility of registering an IBC company.
Hamriyah Free Zone FEZ «Hamriyah»
Largely focused on small and medium enterprises with 7 units workings in different directions.
Fujairah Free Zone FEZ«Fujairah»
Offers registration of companies with a virtual office of trading and consulting
Sharjiah Airport International Free Zone FEZ of Sharjiah Airport
The main advantage is the possibility to obtain a logistics license to operate a smart office. Inexpensive service, fast registration, excellent infrastructure.
Umm Al Quwain Free Zone FEZ «Umm Al Quwain»
Main directions: working with trading and consulting companies. Flexible visa policy when renting a small office space.
Free economic zones in the United Arab Emirates allow conducting any type of business with virtually no taxes on profits and the company itself, without fear of trade barriers and quotas.
OLIESERVEs team - professionals in their field. We will not only choose the most suitable Free Economic Zone in the UAE for your business, but will also competently incorporate a company, and assist you in maintaining it.
More information about registration, see http://olieserve.com/jurisdictions/uae/uae-company-formation/
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