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Freezone Company Formation in UAE

ADAM Consulting – Your Partner in Business for Freezone Company Formation in the UAE

ADAM Consulting is a name trusted since 2002 for Companies like yours from all over the world to set up, scale & expand their business in the Middle East and specifically the United Arab Emirates. We put your ambitions at the centre of everything we do and hold your hand throughout your business journey.
Are you interested to know, understand and learn all about Freezone company formation in the UAE? Browse through these quick links on this page;

Quick Facts about the United Arab Emirates (UAE)

The United Arab Emirates is a country situated on the end of the Arabian Peninsula, bordering the states of Saudi Arabia and Oman as well as sharing a maritime border with Qatar and Iran.

The country is a federation of the seven emirates or cities and constitutes of Abu Dhabi (the capital), Dubai, Sharjah, Ajman, Ras Al Khaima, Fujairah and Umm Al Quwain

The UAE enjoys a quite strategic location, substantial financial reserves, sizeable sovereign wealth fund, promising investor home economies as well as consistent government spending.

Foreign Direct investments contribute to a stable and progressive economy with the focus of the government being primarily on economic diversification.

Why Businesses are choosing UAE for their Free zone Company Formation

Long Term Value

UAE is ranked #1 regionally & #7 globally in terms of long term value creation of their resources among 62 other countries.

Competitiveness

UAE’s Competitiveness is ranked # 1 worldwide across 23 indicators, including Government Decision and Global Talent.

Ease of Doing Business

UAE is ranked 1st in the Arab World and 11th internationally in the “Ease of Doing Business Report” published by World Bank that evaluated 190 countries across several factors.

Stable Economy

The UAE has a robust economic outlook moving away from the oil-driven economy by diversifying its income resources via the Vision 2021 strategy set forth by the ruler.

Government Spending & Support

The UAE has injected over 300 Billion AED to encourage economic growth via innovation initiatives. So far, over 100 Initiatives are ongoing, all promoting a versatile digital economy.

Excellent Arbitration System

The UAE laws outline the rights of every citizen and promote equality regardless of race, religion, gender, nationality or social position. It also has well-defined laws to protect the interest of business owners and their businesses

Safety & Security

The UAE is known to be one of the safest and most secure countries in the world. In an official survey conducted recently, over 96.1 % of citizens said they feel safe and secure in the country.

The Business Environment- Understanding Free zone Company Formation in UAE

What is Freezone in UAE?

A freezone entity is an economic area where the trade of goods and services at typically a preferential tax and customs rate is permitted. The idea to launch free zones in the UAE was to attract and increase foreign companies to establish their presence in UAE leveraging on benefits such as 100 % foreign ownership.

Currently, more than  45 free zones are operating in the UAE with Dubai taking the majority.Some for the well known freeznes in UAE are JAFZA ,DWC,DMCC,DAFZA,DWTC,Dubai Silicone Oasis Free Zone,KIZAD,Hamriyah Freezone,SAIF,AJMAN Freezone,RAKEZ,Umm Al Quwain Freezone,SHAMS etc.

Why Do Entrepreneurs Choose Freezone Company Formation in the UAE

Among the numerous advantages of setting up a company in a freezone is that it primarily allows the foreign investor to hold 100 % shares of the company. The freezones offer Trading,Service,Industrial and Branch licenses. Some of the significant advantages of a freezone company in UAE is are as follows:

  • 0% Corporate or Income Tax
  • 100 % Ownership
  • 100 % Repatriation of capital and profits
  • Minimum paperwork required to incorporate a freezone company
  • Wide range of choice for business activities
  • Exemption from custom duties
  • The process of recruiting staff is relatively more straightforward in freezones
  • A diverse selection of Business Categories
  • Local Partner or Local Sponsor not required
  • High-quality infrastructure facilities
  • Competitively priced operational cost
  • A wide choice of ready-made Offices and Warehousing facilities for leasing

List of Offshore Jurisdictions - In the UAE

There are currently three offshore jurisdictions in the United Arab Emirates. ADAM Consulting is an award-winning registered offshore agent for all three.

1

Dubai Offshore
( JAFZA)

2

Ras Al Khaima
International Business
Corporation (RAK IBC)

3

Ajman
Offshore

List of free zones in the UAE Dubai

Free Zones in Dubai

  • Jebel Ali Free Zone (JAFZA)
  • Dubai Multi Commodities Centre (DMCC)
  • Dubai Airport Free Zone (DAFZA)
  • Dubai World Trade Centre Free Zone (DWTC)
  • Dubai Science Park
  • Dubai Car and Automotive City Free Zone (DUCAMZ)
  • Dubai Design District
  • Dubai Gold and Diamond Park
  • Dubai Healthcare City (DHCC)
  • Dubai Industrial City (DIC)
  • Dubai International Academic City
  • Dubai International Financial Centre (DIFC)
  • Dubai Internet City (DIC)
  • Dubai Knowledge Village
  • Dubai Logistics City
  • Dubai Media City
  • Dubai Outsource Zone
  • Dubai Silicon Oasis
  • Dubai Studio City
  • Dubai Techno Park
  • Dubai Technology and Media Free Zone
  • International Media Production Zone ( IMPZ)

Abu Dhabi

Free Zones in Abu Dhabi

  • Abu Dhabi Global Markets (ADGM)
  • KHALIFA INDUSTRIAL ZONE ABU DHABI (KIZAD)
  • Twofour54
  • Masdar City Free Zone

Sharjah

Free Zones in Sharjah

  • Hamriya Free Zone (HAFZA)
  • Sharjah Airport International Free Zone
  • Sharjah Publishing City Free Zone
  • Sharjah Media City Free Zone (SHAMS)

Fujairah

Free Zones in Fujairah

  • Fujairah Free Zone
  • Fujairah Creative City
  • International Free Zone Authority (IFZA)

Ras Al Khaimah

Free Zones in Ras Al Khaimah

  • Ras Al Khaimah Economic Zone (RAKEZ)
  • RAK Maritime City Free Zone Authority (RMCFZA)

Ajman

Free Zones in Ajman

  • Ajman Free Zone
  • Ajman Media City Free Zone

Umm Al Quwain

Free Zones in Umm Al Quwain

  • Umm Al Quwain Free Trade Zone (UAQFTZ)

The Process of Offshore Company Formation Documents: What are the documents required for an Offshore Company Formation?

To register an offshore company in the UAE, the applicant who is either natural or juristic must submit, along with other supporting documents, a duly signed application form to the offshore company’s registrar.

The application form contains information on the proposed capital. The application form will require the shareholder’s full name and addresses as well as the number of shares held by each along with their proposed value. The shareholder may decide to either nominate minimum one director who can be from among them or appoint an outside individual. The application is to be submitted along with the company’s proposed memorandum and articles of association.

Other Documents include the following

Individual Applicant

1. CV/Resume of the applicant
2. Applicant’s Passport Copy
3. Reference letter from Bank
4. Proof of Residence (any document such as utility bills that verifies the address of the applicant)
5. Passport copy of nominated Director
6. A notarized Power of Attorney duly attested by UAE Embassy/Consulate in favour of ADAM Consulting to pursue the incorporation procedure on behalf of the applicant.

Corporate Applicant

The following documents shall be duly attested by the UAE embassy in the country of incorporation.

1. Company’s Registration Certificate
2. Certificate of good standing
3. Applicant Company’s Memorandum & Articles of Association
4. Board Resolution for offshore company establishment, director’s appointment and legally permitting ADAM Consulting as a legal representative of the company.

Other Document/s:

5. Reference letter from Bank

Types of Entities for Freezone Company Formation in UAE

In the UAE, Foreign Investors can choose between incorporating a Freezone Establishment, also known as FZE or a Freezone Company, also known as FZCO, FZC or FZ LLC.

What is the main difference between an FZE and FZCO?

Factors Freezone Establishment (FZE) Freezone Company (FZCO)
Shareholder There is only be one shareholder which can either be an individual or a company A min of 2 and maximum of 5 Shareholders are required for this type of freezone company formation.
Share Capital Depending on the type of activity and freezone this can vary between AED 1000- AED 300,000

FZ LLC vs Mainland LLC in UAE: What is the difference?

A freezone LLC is established by its individual or corporate shareholder or a combination of the two as an independent legal entity with limited liability corporation. It is 100 % owned by the foreign investor, unlike the mainland LLC

Mainland LLC FZ LLC
Requires local partner or sponsor who will own 51 % of shares. Can be 100 % foreign-owned
Can trade across UAE as well as internationally Can only trade within the designated freezones . Requires mainland distribution agent to do business within UAE, i.e. outside of the freezone in which the company is registered.
Can conduct commercial, professional or industrial activities Can conduct commercial, professional or industrial activities

Type of Business Licence of Freezone Company Formation in the UAE.

The type of trade licence you require for your freezone company in UAE depends on what kind of business are you going to conduct. Below is the kind of licences for freezone company formation in the UAE.

General Trading Licence

This type of licence allows you to do trading activities such as import and export, and deal the in trade and distribution of goods and commodities

Industrial Licence

With an industrial licence, you are permitted to manufacture, package and process.

Service Licence

If you are looking to offer professional services such as accountancy or consulting, then this type of licence is the ideal choice.

National Industry Licence

If the UAE government has acquired at least 51% Ownership of your manufacturing business in the UAE, you need to apply for a National Industry Licence.

Innovation Licence & Tech Start-Up Licence

This type of licence is provided only by select freezones and is usually only granted to tech startups with a focus to scale regionally and to Tech start-ups aligned with the UAE National Innovation Priority Sectors. This type of licence is not available for technology service providers.

E-commerce Licence

In UAE you must legally register your online store to sell goods. This type of licence enables you to carry out e-commerce activities.

Freelance Permit

The Freelance permit, in essence, is not a trade licence but rather a permit that enables you to offer services and expertise as a sole practitioner. You cannot employ staff. The permit can be considered as legal permission for you to render your services as an independent, individual contractor. The permit holder can also apply for VISA for him once permit is issued .Once his VISA is stamped to th passport ,he can sponsor his family visa.

Dual Licence (Abu Dhabi)

All the free Zone companies in Abu Dhabi can apply for Branch of Free Zone company license from DED Abu Dhabi ,without the requirement of an Emirati National as the LSA(local service agent) and Office space in the Mainland . The free Zone will act as the LSA and the companies office space in the freezone will be the office of the branch.

The Process of Freezone Company Formation

Documents: What are the documents required for a Freezone Company Formation?

List of Document for Freezone Company Formation in UAE

  • Passport copy of the Shareholder(s);Director(s);Manager
  • Address proof for all the above
  • Professional CV of all the above
  • Proposed names of the company
  • Specimen Signature document for the Shareholder /Director
  • Business Plan (based on activity /Freezone)

Costs: What is the price for a freezone company formation in UAE?

The cost will depend on the freezone, number of visa required,Type of Office selected and other factors; however, for setting up a company in a freezone the cost can start from AED 9000 onwards in UAE.

Freezone Setup Process: How to start your business in a Freezone in UAE

At ADAM Consulting, we guide you and hold your hand through each step of your business journey. Although the process is quite detailed, below is an 8 Step Process highlighting the essential incorporation procedure for your freezone company formation in the UAE with our highly experienced staff.

1

STEP

Determine your type of business activities

2

STEP

Determine legal form

3

STEP

Finalization of your tradename

4

STEP

Submit all required document for approval

5

STEP

Get notified when licence is issued and collect documents

6

STEP

Open your Bank Account. We can Introduce to Bankers we deal with.

7

STEP

Get your immigration card if opted in for a visa package

8

STEP

Get your visa processed if applicable

Avail attractive freezone packages ! Apply now for a free consultation

Frequently Asked Question on Freezone Company Formation in UAE

All you need to know about freezone company formation in the UAE. Browse through this section to get a quick overview or schedule a consultation with an expert business advisor

A freezone visa is a residence visa and permit issued by Immigration department of the emirate where the a company based in a freezone. A residence visa allows you to work and live in the UAE. The most common way to obtain a freezone visa is through employment at a freezone company.
The main difference between the two is the validity of the visa . While a Mainland Visa is valid for two years, a freezone visa is valid for three years. Also, employment visas in mainland are regulated by the Ministry of Labour UAE while a freezone employment visa is taken care of by the respective freezone authority
By law, any economic activity outside of the Freezone, i.e. in Dubai mainland is regulated by the Department of Economic Development of that Emirate. Hence, a freezone is not allowed to commercially trade in Dubai without appointing a mainland distributing agent. Agents will charge their fee, and a customs duty of 5 % will become applicable on imports.
In a professional context, there is no best or worst freezone in UAE. All freezones offer their unique facilities and services, and it ultimately depends on your personal preference, needs and business activities. However, times and again freezones like DMCC, DIFC, DAFZA etc. have been ranking among the top freezone authorities over recent years.
In Dubai the economical option in Freezone company setup starts from AED 31,150 aprox.More economical options are offered by Free Zones located outside Dubai in other Emirates like Sharjah, Umm al Quwain (UAQ), Ajman, Ras Al Khaimah (RAK) and Fujairah.
It totally depends on your skills, interest, expertise, resources and essential your budget (capital) Many business setup in a freezone to import and re-export goods and commodities . Speak to one of our consultants to evaluate what option you may have at hand.
FTZ stands for free-trade zone (FTZ) and is a geographic area where goods may be landed, stored, handled, manufactured or reconfigured and re-exported under specific customs regulation and generally not subject to customs duty. FZE stands for Freezone Establishments and is a legal freezone entity with only one shareholder.
The activities as discussed in this section include those that are related to commercial activities such as trading and services of goods, professional services, import and export, Media & IT, E-commerce, Tourism and freelancing
In majority of the Freezones in UAE,Share capital is only shown in the papers and Not physically deposited to any Bank account with exceptions like DMCC Freezone ,where the share capital needs to be shown in a Bank account under the company name in UAE.
No. You do not need a local partner for a freezone company formation. A freezone company is 100 % owned by the foreign investor.
This will depend on your requirement and the freezone package you choose. It can range from 0 –visa options to 6 visa option. If you require more visas, you will need to have a larger physical space. Please consult our Advisors to obtain more information.
Freelancer gets a Permit from the freezone using which he can provide services and bill under his name .There is NO Company that is registered

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