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Establishing a company in Dubai Free Zone

٠٦ مارس Establishing a company in Dubai Free Zone

How to set up a company in Dubai Free Zone? Dubai is a unique global destination for setting up companies thanks to its strategic location and advanced infrastructure that makes it a business hub in the Middle East. Dubai’s free zones offer many advantages to investors, such as full foreign ownership, tax exemptions, and easy access to regional and global markets. Among the most prominent of these areas is the Dubai Free Zone, which is an ideal choice for entrepreneurs and companies looking to establish their businesses in a flexible and growth-friendly legal environment. In this article, we will review the steps and advantages offered by the free zone to set up a company in the Dubai Free Zone , and the vital role it plays in strengthening the emirate’s economy and attracting foreign investment.

Establishing

Steps to establish a company in the Dubai Free Zone

To establish a company in the Dubai Free Zone, several important steps must be followed to ensure compliance with the laws and to take full advantage of the benefits provided. Here are the most important of these steps:

  1. Choosing a business activity: Determine the type of business activity you intend to conduct in the free zone, whether commercial, industrial or service. The activity must comply with the laws and regulations in force in Dubai.
  2. Choosing the right free zone : Dubai has many free zones such as Dubai Airport Free Zone (DAFZ), Dubai Media City, and Jebel Ali. You should choose the area that suits your business and the needs of your company.
  3. Determine the type of company: The company can be a limited liability company, a branch of an international or local company, or a joint venture. You must choose the legal structure that suits your business.
  4. Submitting the necessary documents: This includes passports of partners or shareholders, articles of association, business plan, in addition to any other documents required by the competent authorities.
  5. Obtaining Approvals: After submitting the documents, approvals must be obtained from the relevant authorities in the free zone.
  6. Issuance of the commercial license: Once approved, the commercial license is issued, which allows the commercial activity to be carried out in the free zone.
  7. Renting an office or workspace: An office or workspace must be rented within the free zone as per the specified requirements.
  8. Opening a bank account: After completing the legal procedures, a bank account can be opened for the company to facilitate financial transactions.
  9. Completing residency procedures: If the investor or employees need residency visas, visas can be requested through the free zone.

By following these steps, you can establish a company in one of Dubai’s free zones and benefit from the unique investment environment it provides.

Advantages of establishing a company in the Dubai Free Zone

Establishing or establishing a company in the Dubai Free Zone offers many advantages that make it an ideal destination for investors and entrepreneurs from all over the world. Here are the most prominent of these advantages:

  1. Full foreign ownership: Foreign investors can own 100% of the company without the need for a local partner, giving them complete control over their business.
  2. Tax Exemptions: Companies in free zones enjoy complete exemption from personal income and corporate taxes for up to 50 years, as well as exemptions from Value Added Tax (VAT) in some cases.
  3. Ease of money transfers: It allows companies to freely transfer profits and capital without restrictions, making it easier to manage funds and expand business internationally.
  4. Advanced infrastructure: Dubai offers world-class infrastructure, including advanced seaports and airports, facilitating the movement of goods and services across various regional and global markets.
  5. Flexible and fast establishment procedures: Free zones feature simplified and fast company establishment procedures, which reduces the time it takes to officially start operating.
  6. Possibility of renting offices and various spaces: Free zones provide various options for renting offices and commercial and industrial facilities to suit the needs of different companies.
  7. Possibility of international employment: Companies in free zones have the flexibility to employ foreign workers without strict restrictions on employing a percentage of nationals.
  8. Supportive legal and regulatory environment: Free zones provide an advanced legal and regulatory environment that protects investors’ rights and ensures commercial stability.

These advantages make Dubai an attractive destination for companies seeking to benefit from a flexible investment environment that supports growth and expansion.

Conditions for establishing a company in the Dubai Free Zone

To establish a company in the Dubai Free Zone, there are a set of conditions that must be met to ensure compliance with local laws and regulations. Here are the most important requirements:

  1. Determine the business activity: The investor must determine the type of business activity that the company will conduct. The activity must comply with the list of permitted activities in the selected free zone.
  2. Choosing a legal structure: The type of company must be determined, such as a limited liability company (LLC) or a branch of an international or local company. The legal structure varies depending on the needs of the business and the type of activity.
  3. Capital Required: Some free zones require a certain amount of capital when setting up a company. This amount varies depending on the free zone and the type of company you want to set up.
  4. Required Documents: Passport copy of all partners or shareholders. Business plan detailing future business activity. Signature form of investors or partners.
    Initial Approval: After submitting the application and required documents, initial approval must be obtained from the competent authorities in the free zone. This approval confirms that the project is in compliance with the laws.
  5. Renting an office or workspace: The company must rent an office or workspace within the free zone. Requirements vary depending on the type of business and the size of the company.
  6. Issuance of the commercial license: After obtaining the initial approval and renting the office, the commercial license is issued that allows the company to practice its activity in the free zone.
  7. Obtaining Visas : Dubai free zones provide the possibility of issuing residence visas for investors and employees working in the company. The number of visas allowed depends on the size of the company and the rented office.
  8. Opening a bank account : After completing all legal procedures and obtaining a commercial license, a bank account can be opened for the company in one of the recognized banks in Dubai.

Adhering to these conditions helps ensure that the company is legally established and benefits from the advantages offered by the free zones in Dubai .

Establishing

Cost Factors of Setting Up a Company in Dubai Free Zone

The cost of setting up a company in Dubai Free Zone varies based on several key factors that affect the total costs. Here are the most important factors that play a role in determining the cost of setting up a company:

  1. Type of Business Activity: Licensing fees vary depending on the type of activity you intend to engage in. Commercial, industrial, and service activities require different licenses, each of which carries its own fees.
  2. Selected Free Zone: The costs of setting up a company vary between free zones in Dubai. For example, costs in Dubai Airport Free Zone (DAFZ) may be higher compared to other areas such as Jebel Ali or Dubai Silicon Oasis.
  3. Company size and number of partners: The required capital and licensing costs increase based on the number of partners and size of the company. Larger companies with a large number of partners or shareholders require higher fees.
  4. Office Space: Renting office or industrial space within the free zone is part of the cost. The rental price depends on the size of the office and its location within the free zone. Some free zones offer flexible solutions such as shared offices which may be a less expensive option for startups.
  5. Registered Capital: Some free zones require a minimum registered capital when setting up a company. This amount can vary depending on the type of company and location.
  6. Visa costs: Issuing residence visas for investors and employees adds additional costs. The number of visas a company can obtain varies depending on the size of the office and the type of activity.
  7. Administrative and legal fees : These include administrative fees for company registration and legal fees related to articles of association and document authentication. These fees vary depending on the services provided and the parties dealt with.
  8. Additional Services: There may be additional costs associated with additional services such as obtaining legal advice, administrative guidance, or support for establishing the company’s infrastructure.
  9. Annual Renewal: After the company is established, the trade license and lease must be renewed annually. The renewal cost varies depending on the type of activity and the size of the company.

These factors are affected by the project details and needs, so it is important to assess the company’s specific needs before choosing a free zone and accurately determine the total costs.

In conclusion, setting up a company in Dubai Free Zone is a strategic choice that attracts investors from all over the world, given the exceptional benefits these areas offer, including full foreign ownership, tax exemptions, and advanced infrastructure. In addition to the ease of procedures and legal flexibility, Dubai Free Zones provide a supportive environment for growth and expansion, making them an ideal destination for entrepreneurs and global companies. With a wide variety of sectors and activities available, Dubai remains a leading business and trade hub in the region, where investors can capitalize on the opportunities available and achieve success in a competitive and dynamic market.

Frequently asked questions about setting up a company in the Dubai Free Zone

What is a free zone in Dubai?

A free zone is a designated economic area that allows foreign investors to establish their companies with full ownership, while enjoying tax and customs exemptions and other privileges.

What business activities are allowed in free zones?

Activities vary by free zone, but generally include trade, manufacturing, services, technology, media, transportation, and distribution. A list of specific activities for each free zone can be checked.

Can a company in a free zone be 100% foreign owned?

Yes, Dubai free zones allow 100% foreign ownership without the need for a local partner.

How long does it take to set up a company in a free zone?

The process usually takes from a few days to a few weeks, depending on how quickly the required documents and conditions are met.