Free Zones in Dubai & the UAE

Free Zones in Dubai & the UAE

- Jamie Harvey

Introduction

Setting up your company in a Free Zone in the UAE has many significant advantages. For certain industries, specific Free Zones operate. These industry-specific Free Zones allow companies to stay close to their market, act as a focal point for prospective customers and offer industry-specific benefits. Whilst setting up in a Free Zone can be straight forward, there are often unexpected costs that need to be considered. In this post, we’ll explore all of the key things to look out for when selecting a Free Zone.

What is a Free Zone?

Free Zones (or Free Trade Zones) were originally set up to boost international business, allowing companies to have 100% foreign ownership and offering preferential rates and taxes. As Free Zones expanded across the UAE they began to specialise in specific industries and niches, each offering their own specific set of competitive advantages. One of the many benefits of setting up a Free Zone business is that it’s an easy process and can be cost-effective. Choosing the right Free Zone for your business is critically important.

What are the advantages of a Free zone?

There are several advantages of Free Zones, and they vary between each Zone. However, there are some ubiquitous benefits which persist across most of the free zones. The main advantages of setting up your business in a Free Zone are:

  • 100% foreign ownership. This allows you to set up your business without the need of a local sponsor.
  • There are corporate and personal tax exemptions, although these are often time-limited.
  • There is often support available for recruitment, opening a bank account and other administrative tasks.
  • Depending on the Free Zone, visa, housing and immigration can be much simpler.
  • Incorporating your company is both faster and simpler with documentation tailored towards foreign investors.

What are the free zones in the UAE?

There are 45 Free Zones in the UAE.

Free Zones in Dubai (27)

Dubai Healthcare City, Dubai Logistics City, Dubai Knowledge Park, Dubai Internet City, Dubai Airport Free Zone, Dubai Flower Centre, Dubai International Academic City, Dubai International Financial Centre, Dubai Auto Zone, Dubai Design District, Dubai Cars and Automotive Zone, Dubai Gold and Diamond Park, Dubai Maritime City Authority, Dubai Industrial City, International Humanitarian City, Dubai Production City, National Industries Complex, Dubai Studio City, Dubai Outsource Zone, Jumeirah Lakes Towers Free Zone, Energy and Environment Park, Dubai Science Park, Dubai Silicon Oasis, Dubai Multi Commodities Centre, Dubai Media City, Jebel Ali Free Zone Authority, Dubai Textile City

Free Zones in Abu Dhabi (7)

Masdar City, Abu Dhabi Ports Company, Abu Dhabi Global Market, Higher corporation for specialized economic zones/ ZonesCorp, Industrial City of Abu Dhabi, TwoFour54, Abu Dhabi Airport Business City

Free Zones in Sharjah (3)

Sharjah Airport Free Zone Authority, USA Regional Trade Center Free Zone, Hamriya Free Zone Authority

Free Zones in Fujairah (2)

Fujairah Free Zone Authority, Creative City Fujairah

Free Zones in Ras Al Khaimah (4)

Ras Al Khaimah Free Trade Zone, RAK Investment Authority Free Zone, RAK Maritime City, Ras Al Khaimah Media Free Zone

Free Zones in Ajman and Umm Al Quwain

Umm Al Quwain Free Zone Authority, Ajman Free Zone Authority

Free Zone’s by industry specialisation

Depending on your organization, it may be appropriate to select a Free Zone based on your industry specialisation. There are some significant advantages to this approach including:

  • Being close to competitors and partners.
  • Being a focal point for businesses wishing to interact with you.
  • Specialised services for your niche.

Here are some of the most popular Free Zones by industry type:

Free Zones for Media and Creative

  • Dubai Media City
  • Fujairah Creative City
  • Sharjah Media City
  • International Media Production Zone

Free Zones For Import Export and International Trade

  • Jebel Ali Free Zone
  • Dubai Logistics City
  • Gold & Diamond Park
  • Dubai Multi-Commodities Centre
  • Sharjah Airport International Free Zone

Free Zones for Technology

  • Dubai Internet City
  • Dubai Techno Park

What is the Cost of Setting Up in a Free Zone?

The total cost of registration at a Free Zone varies significantly. Often, companies simply look at the registration or license fees, however, there is a range of fees, costs and requirements that need to be considered. Unless you're in a specific niche that requires the benefits of an industry-specific Free Zone, then it’s always worth speaking to an expert to make sure you get the best possible solution.

When considering the overall cost of setting up in a Free Zone, there are four main cost areas to consider:

Registration Fees - Fees vary from as little as 6,000 dirhams to 15,000 dirhams. The registration fees really depend on which Free Zone you’re selecting.

License Fees - Fees for smaller niche Free Zones start from 3,000 dirhams and can be as much as 20,000 dirhams. Depending on the Free Zone you may also be required to pay name approval fees and attestation of document costs as part of the license fee.

Flexi-Desk Fees - Not all Free Zones have Flexi-desk capabilities. For example, Jebel Ali Free Zone has a mandatory office requirement, and the minimum cost of an office is 54,000 dirhams annually. If your selected Free Zone has a Flexi-desk option they can cost between 10,000 - 20,000 dirhams annually.

Share Capital Requirements - Finally, share capital requirements vary significantly. Some Free Zones do not require any share capital to register your company, whereas others can require a deposit in the company bank account of 50,000 dirhams which will be considered as the company’s share capital.

PPG Can Help

Whilst setting up a company in a Free Zone is relatively straight forward, there are many pitfalls that can be avoided by seeking professional help. At PRO Partner Group, our team of expert advisors can help you select the correct Free Zone for your company as well as assist with other areas such as Investor Visas, staff and family Visas, PRO services and HR, Payroll and Company Secretarial Services. Contact us today and we’ll make your move to Dubai as seamless and straightforward as possible. Please get in touch with us on +971 (0)4 456 1761 for Dubai or +971 (0)2 448 5120 for Abu Dhabi, email us at info@ppg.ae or complete the contact form below and we will be delighted to assist you.

Get in touch with Jamie Harvey

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