How to set up a business in JAFZA
Free zones provide investors with an excellent way of starting a business in Dubai and a simpler and more cost-effective alternative to mainland company setup for establishing a presence in the UAE. When considering the best Dubai freezone for company setup, Jebel Ali Free Zone Authority (JAFZA) should certainly be on your list.
Established in 1985 as the flagship free zone of Dubai Ports World, it is spread over an area of more than 57 square kilometres and is the largest free trade zone in the UAE and one of the most successful in the Middle East region. It is home to over 7,500 companies from over 100 countries and a diverse range of different industries, including manufacturing, trading, logistics and services.
As with other free zones, JAFZA also provides several other key benefits to businesses such as:
• 100% foreign ownership
• 0% corporate tax for 50 years with renewable concession
• No restriction on capital repatriation
• No import or re-export duties
• No currency restrictions
• 0% income tax
• No restrictions on hiring of foreign employees
Which industries is JAFZA suited to?
JAFZA’s diverse infrastructure and wide range of facilities make it suitable for many different industries. However, the main industries that can be found in the free zone are:
Manufacturing industry in JAFZA
JAFZA has a strong manufacturing base with a focus on industries such as automotive, aerospace, food processing, and electronics. Its excellent connectivity to major seaports, airports, and highways makes it easy for manufacturing companies to import raw materials and export finished goods to global markets. It also has facilities designed to meet the specific needs of manufacturing companies such as warehouses, factories, and industrial parks, equipped with modern technologies and machinery.
Having a large number of manufacturing and trading companies already present also means that suppliers and customers can be sourced from within the free zone and manufacturing companies can leverage this to build a robust, locally based supply chain.
Logistics industry in JAFZA
With a total area of 3.85 million square metres comprising modern warehouses, logistics facilities, and office spaces, JAFZA enables logistics companies to efficiently manage and move goods within and outside the region and reach 3.5 billion customers across key markets in the Middle East and North Africa.
Its unique location next to the Jebel Ali port, the largest man-made port in the world, allows logistics companies to easily access and handle goods coming in and out of the UAE and its single customs bonded area allows for swift cargo movement from sea to air without the need for any intermediate customs checks.
Services industry in JAFZA
JAFZA is home to many service-based industries, including business and professional services, information and communication technology, healthcare and life sciences, and education and training services.
The free zone offers a streamlined business setup process for these businesses with online registration, fast-track visa processing and advanced IT and communication systems to support remote work and digital services. It also provides access to legal, financial and marketing services and assistance with government approvals.
Trading industry in JAFZA
The UAE's favourable business environment and strategic location have made it a hub for trade and commerce with approximately 26% of the country’s GDP coming from the retail and wholesale trade sector.
JAFZA plays a major role in the distribution of these goods both within the country and abroad, and supports businesses trading in a variety of commodities such as food and beverages, textiles and apparel, electronics, vehicles and automotive equipment, chemical and industrial products, and machinery.
How do I set up a business in JAFZA?
The following are the steps for setting up a business in Jebel Ali Free Zone (JAFZA):
1. Determine the Business Activity: The first step for company formation in Dubai is to determine the type of business activity you wish to undertake in JAFZA. JAFZA offers licences for various business activities, including trading, industrial manufacturing, services and e-commerce.
2. Choose a Legal Structure: Next, you must decide on the legal structure of your business, such as a sole proprietorship, partnership, or a limited liability company (LLC). JAFZA allows the formation of different types of companies, including Free Zone Establishment (FZE), Free Zone Company (FZCO), branch offices and offshore companies.
3. Reserve a Company Name: You must then reserve a company name. Careful consideration should be given to ensure that the name is unique, relevant, and legally compliant, and that it aligns with your business objectives and future expansion plans.
4. Apply for a business licence: You must then apply for a business license in Dubai with JAFZA. This can be done online, and the type of required commercial license in Dubai and JAZFA will depend on the nature of your business activity.
5. Secure Premises for setting up a business in the UAE: Once the licence is approved, you must secure premises for your business in JAFZA. JAFZA provides a range of facilities, including warehouses, offices, and land for industrial use.
6. Obtain Approvals: Setting up a company in Dubai, within Jebel Ali Free Zone (JAFZA) requires several approvals from different authorities. The following are the most important ones:
• JAFZA Trade Licence: You need to obtain a trade licence from JAFZA to conduct business activities in the free zone. The type of trade licence required depends on the nature of your business activity.
• Legal Entity Registration: You need to register a company in the UAE with the JAFZA authorities and obtain a legal entity registration certificate.
• Residence Visa: If you are planning to work in the business, you need to obtain a residence visa from the UAE authorities. This involves a medical fitness test and other procedures.
• NOC from Dubai Municipality: You need to obtain a No-Objection Certificate (NOC) from the Dubai Municipality, which certifies that your business premises meet the required health and safety standards.
• Environmental Approval: If your business activity involves the use of hazardous materials or processes, you may need to obtain an environmental approval from the Dubai Municipality.
• Fire Approval: You need to obtain fire approval from the Dubai Civil Defence for your business premises, which ensures that your premises comply with fire safety regulations.
• Customs Code Registration: If your business involves import or export of goods, you need to register for a customs code with Dubai Customs.
7. Register for Visas: You must register for visas for yourself and any employees you wish to hire. JAFZA provides support services for visa processing.
8. Open a Bank Account: Finally, you must open a bank account in the UAE and deposit the minimum capital required for your business activity.
JAFZA is the centre of Dubai’s logistics network which spreads across the Middle East and beyond into major markets across Europe, Asia and Africa.
Its state-of-the-art facilities and infrastructure for air, sea, and land transportation allow unique access to major global markets and excellent opportunities for international expansion. However, there are a number of approvals and compliance requirements involved in business setup in Dubai that can be challenging to navigate without the support of an experienced and well-established corporate services provider.
How can Sovereign PPG help?
Sovereign PPG has in-depth knowledge of the UAE market and close connections with government departments and freezone authorities. We can streamline the company incorporation process, managing all aspects from licensing to visa, labour and immigration approvals.
If you need assistance with setting up a company in JAFZA or any other related onshore or offshore company setup, restructuring, local partner or PRO support matter in Abu Dhabi, Dubai, the wider UAE, Oman, Qatar or KSA, then please do 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 SovPPG@SovereignGroup.com or complete the contact form below and we will be delighted to assist you.
