Ever thought what makes Dubai an incredibly attractive business location. Well, of course there is amazing tax policies, rich infrastructure, and affluent customer base, but beyond that there is something else. Let us break the suspense, it is the ease of doing business and establishing a new company there. The name Dubai definitely implies sophistication and luxury but starting a venture here can be extremely budget friendly and straightforward. All the courtesy to the nation’s supportive government. One such popular choice among entrepreneurs is business setup in UAE freezones.
This article is dedicated to the cherished freezones of UAE, which are special economic zones that make the setup of businesses even easy. It will also cover the process, cost, and basic necessities of starting business in one of the freezones in UAE.
Meaning of a freezone
Freezones are also known as free trade zones, and they refer to one of the type of jurisdictions in UAE where business can be established. These economic zones have their own regulating authority who looks after the conduct of business, license issuance and other related matters there.
The businesses that are established there can conduct business operations within that designated freezone and overseas but not directly in rest of the UAE. For doing so, there is a separate procedure. Currently there are more than 40 freezones operating across the seven Emirates. Dubai hosts more than 30 of them that offer some exclusive benefits and conducive business climate. In fact, Dubai free zone business setup can be a promising and lucrative opportunity for aspiring entrepreneurs.
Features of freezones in UAE
There are certain traits of freezones in UAE that make it unique and ideal for business setup:
100% foreign business ownership: Business setup in UAE freezones do not require partnering up with local Emiratis for sponsorship. Which means foreigner can enjoy complete ownership of their businesses.
100% repatriation: Businesses in freezones can enjoy complete repatriation of the capital and profits.
Very low tax rates: Zero personal tax and very low corporate tax in freezones helps entrepreneurs keep more of what they earn.
Modern and latest facilities: Top notch infrastructure that freezones offers facilitate smooth business operations.
Range of business activities: There are more than 2000 activities that can be pursued that belong to diverse industries.
Simple business setup process: Freezones feature very less administrative hurdle and a less complex process to establish new firm.
Freezone business license
A freezone business license is an official permit, issued by the relevant government authority of a freezone, that allows the conduct of business in that zone. It is issued by the government body of the freezone where you decide to set up your venture. There are different types of business licenses that you can get for various industries like finance, education, heath, science, art and crafts, media, law etc. Major types of UAE or Dubai free zone license include:
Commercial license:
This license is required for activities such as buying/selling of goods and services, export/import, and other such commercial activities.
Industrial license:
For conducting industrial and manufacturing activities in the nation, you will need to secure an industrial license.
Professional license:
Those looking to deliver services based on their qualifications, knowledge and skills would need a professional license.
Documents needed for business setup in UAE freezones
For a smooth business setup in UAE freezones, you will have to prepare and submit some paperwork to the authorities. Here are the general documents you will need for UAE freezone company setup:
- Passport copy
- Passport size photographs
- Business plan
- Emirates ID
- Entry permit/visa page
- Bank reference statements
- Trade name certificate
- Initial approval certificate
- Additional approvals
- Ejari contract for office space
- Memorandum of Association and Articles of Association
To ease out the documentation hassle, it is recommended to get in contact with a professional company setup firm like Dubiz.
Step-by-step process of starting a business in UAE freezone
Here is the process that needs to be followed for smooth business setup in UAE freezones:
Decide on the business operations:
First, you must choose what activities you want to pursue in the UAE. There are many operations that are allowed belonging to finance, healthcare, science, IT and many more industries. The type of activities you choose will also dictate the type of license you will need: commercial, industrial, or professional. Example, if you decide to practice as an accountant in UAE, you will need a professional license for that.
Pick the right freezone:
UAE features more than 40 top class freezones that specialize in specific industries. So, you will need to choose the ideal freezone for your business. It will depend on your business’s nature, chosen activities, and the respective Emirate where you want to operate.
Choose the legal structure:
Next, you will have to decide the legal form of your firm. There are various types of business structures allowed in UAE. you can choose between options like limited liability company, partnership firm, branch of foreign company, civil company, holding company and so on. It will depend on your business preference and the type of operational flexibility and control you want to have.
Register a trade name:
You must register a lawful and a suitable name for your business in UAE. There are certain guidelines that the UAE government has put forth for naming businesses. Make sure you follow each of them as otherwise your name will not get approved.
Get the initial approval:
For starting any kind of business setup in UAE freezones, you need to seek a pre-approval from the Economic Department. Doing so allows you to proceed further with the business formation process and reflects that the UAE government has no objections against your business.
Rent an office space:
Next comes choosing and sorting the office space for your business. You can completely own a space, rent a space, use shared workplaces and so on. For the rented space, you will need to get into an agreement with the landowner and get the same registered on Ejari, a government portal for such purpose. However, for some business models, you may not need a physical space such as running a dropshipping business.
Additional government approvals:
For many types of business operations, additional approvals are needed from some government bodies. Take an example: For starting any health-related business or working as healthcare professional in Dubai, a permit needs to be secured from the Dubai Healthcare Authority (DHA). Same applies to every Emirate. You must identify if your business also needs any additional approval.
Apply for the license:
Finally, after having all the approvals in hand and organizing the needed documents, you can reach out to the respective freezone authority for license application. You will need to fill out an application form and submit it along with the paperwork and make the fee payment. After submission, the authority reviews the application and once it gets approved, your business license will be issued.
Get the visa:
As a foreigner, you will need to get visa to legally enter, stay and work in the UAE. Similarly, you may want to hire foreign staff for whom you will need to get the employee visa. Additionally, you can also get family visa for your family members and bring them to UAE.
Open business bank account:
Every business must have a bank account under its name in UAE. Corporate bank accounts are needed for financial transactions, matters and to avail services like business credit cards, loans, etc.
By following the above process diligently, you can be assured that your business setup in Dubai free zone will be smooth, error-free, and successful.
Free zone license cost in Dubai
UAE free zone company setup cost can start from as low as AED 6,000*. However, this cost can vary based on the number of visas you need, the freezone you pick and specific business conditions. You can know the exact Dubai freezone license cost with help of professional business setup firms like Dubiz Business Setup.
Get ready for your business in Dubai
If you are looking for a hassle-free business setup in UAE freezones, you have come to the right place. This article aims to make you understand the tits and bits of smooth establishment. However, if you are still feeling lost, do not worry. Dubiz Business Setup can make the process easy for you while taking the burden of legal formalities from your shoulders. They have years of industry expertise and have helped countless entrepreneurs in starting and running successful businesses in the Emirates. They can help you with the company registration, trade license, all types of visas, document handling, government approvals, bank account, tax, and VAT, getting office space, marketing your business and a lot more.
You can start with a free consultation with one of their top business setup experts. Connect with them now!