Freezone Company Formation in UAE

UAE Freezones, the cornerstone of business innovation, are strategically designed economic hubs within the United Arab Emirates (UAE). These zones are meticulously crafted to benefit entrepreneurs and investors, making UAE Freezone company formation an increasingly enticing prospect. This article will explore the concept of freezones and their importance and provide a comprehensive guide to the UAE Freezone company formation procedure.

Ready to embark on your journey to establish a thriving business in the UAE Freezone? Contact Filings.ae today for comprehensive assistance and guidance at every process stage of Freezone Company Formation.

What is Freezone in UAE?

A UAE freezone, also known as a free trade zone, is a designated geographic area within the United Arab Emirates (UAE) that offers unique business advantages and incentives to companies looking to establish a presence in the country. The UAE government sets up these freezones to promote foreign investment, facilitate trade, and diversify the economy.

UAE FreeZones - At a Glance

Over 45 Freezones were in the United Arab Emirates (UAE).  Below, you will find an informative table listing the various Freezones situated across the United Arab Emirates (UAE):

Abu Dhabi

• Abu Dhabi Media Freezone
• Masdar City
• Khalifa Industrial Zone Abu Dhabi (KIZAD)

Dubai

• Dubai CommerCity (DCC)
• Dubai Internet City
• Dubai Media City
• Dubai Production City
• Dubai Studio City
• Dubai Outsource City
• Dubai Knowledge Park
• Dubai International Academic City
• Dubai Science Park
• Dubai Design District
• Dubai Multi Commodities Centre (DMCC)
• Jumeirah Lakes Towers
• Jebel Ali Freezone
• Dubai Airport Freezone
• Dubai Silicon Oasis
• Dubai HealthCare City
• International Humanitarian City
• Dubai Maritime City
• Gold and Diamond Park
• Dubai South
• Dubai International Financial Centre
• Meydan
• National Industries Park

Sharjah

• Sharjah Airport International Freezone
• Hamriyah Freezone
• Sharjah Media City - Shams

Ras Al Khaimah

• Ras Al Khaimah Economic Zone-RAKEZ
• RAK Digital Assets Oasis

Ajman

• Ajman Freezone
• Ajman Media Freezone

Umm Al Quwain

• Umm Al Quwain Free Trade Zone

Fujairah

• Fujairah Frezone Authority
• International Freezone Authority (IFZA)
• Creative City

Benefits of Freezone Company Formation

Here are some key characteristics and benefits of Freezone Company Formation:

• 100% Foreign Ownership: Foreign investors can own their companies outright without requiring a local sponsor or partner, ensuring complete control.
• Tax Advantages: Freezone companies often enjoy tax exemptions, including no personal income or corporate tax for a specified period.
• Customs Benefits: Streamlined customs procedures and exemptions for import and export duties make international trade more efficient and cost-effective.
• Business-Friendly Environment: Freezones offer simplified registration and licensing processes with minimal bureaucracy.
• Strategic Locations: Many freezones are located near major ports, airports, and transportation hubs, facilitating efficient logistics and global trade.
• Sector-Specific Zones: Some freezones cater to specific industries, providing tailored support and resources for businesses in those sectors.
• Modern Infrastructure: Freezones offer state-of-the-art facilities, including office spaces, warehouses, and industrial facilities.
• Skilled Workforce: These zones attract a diverse pool of skilled professionals worldwide, making it easier for businesses to find the needed talent.
• Networking Opportunities: Being part of a Freezone community provides businesses with valuable networking opportunities, allowing them to connect with other companies, potential clients, and partners.
• Full Repatriation of Profits: Companies can repatriate all their profits and capital without restrictions in many freezones.
• Protection of Intellectual Property: Freezones often provide robust protection and legal frameworks.
• Flexible Business Structures: Companies can choose from various legal structures, such as FreeZone Company (FZ Co.), Freezone Limited Liability Company (FZ LLC), and more, to suit their needs.
• Minimal Reporting Requirements: Freezone companies typically have simplified reporting and auditing requirements compared to mainland businesses.
• Access to Investment Incentives: Some freezones offer additional incentives like research and development support, grants, and access to venture capital.
• Global Expansion: Freezone businesses have a robust platform for global expansion and international trade due to their favourable regulatory environment and strategic locations.

Procedure for UAE Freezone Company Formation

The procedure for UAE Freezone Company Formation involves the following key steps:

• Select Business's Legal Structure
• Choose a trade name/Company Name
• Apply for a business licence
• Office Space Selection
• Complete Pre-approvals, Business Registration, and Get a License.

Select Business's Legal Structure

When deciding on the legal structure for your business in a freezone, you typically have two main options:

Freezone Limited Liability Company (FZ LLC) or Freezone Company (FZ Co.)

This type of company often involves multiple shareholders, individuals or other companies. Each shareholder's liability is limited to their investment. It offers flexibility in ownership and management.

Freezone Establishment (FZE)

An FZE is typically established with a single shareholder, individual or a company. It's preferred by solo entrepreneurs or small business owners who want complete control. The shareholder's liability is limited to their investment.

Note that not all freezones may offer both company types. It's crucial to check with each freezone authority to understand their registration options, specific regulations, and benefits.

At Filings.ae, we can assist you in selecting the correct business entity based on your unique needs.

Capital Requirements for Freezone Company Formation

Capital requirements vary across different freezones in the United Arab Emirates:

• In Abu Dhabi's freezones, no specified minimum capital requirement for starting a business exists.
• To establish a Limited Liability Company (LLC) in the Khalifa Industrial Zone Abu Dhabi (KIZAD), you need a minimum paid-up capital of AED 150,000.
• Creating a Freezone Company (FZ Co.) in the Dubai Airport Freezone requires a minimum share capital of AED 1,000, with each share valued at AED 1,000.
• Within the Dubai Multi Commodities Centre (DMCC), the minimum share capital for forming a freezone company is AED 50,000 per company and AED 10,000 per shareholder. However, the company must have a minimum share capital of AED 1 million to obtain a General Trading License.
• Establishing a Freezone Establishment (FZE) in the Hamriya Freezone mandates a share capital of AED 150,000.

Selection of Trade Name for Freezone Company in UAE

Selecting the right name is crucial for a freezone company setup in the UAE. Your trade name is not just a label; it represents your business identity and significantly attracts customers and partners. Here are important considerations when choosing a trade name for your business in the UAE:

Check Name Availability

Verify if your desired trade name is available and permitted by the freezone authority or the Department of Economic Development (DED) to avoid conflicts with existing registrations.

Guidelines for Selection of Trade Name:

• Avoid Restricted Terms: Certain terms, such as 'Abu Dhabi' and 'United Arab Emirates, ' are typically not allowed in the name of a Freezone Limited Liability Company (FZ-LLC) or its branch.
• Cultural and Legal Sensitivity: Ensure your trade name respects local cultural norms and legal requirements, avoiding offensive or inappropriate names.
• Include Legal Form: Always include your company's legal form (e.g., LLC, FZE, DMCC) after the trade name to clarify your business's structure.
• Match with Activity and Legal Status: To avoid confusion, your trade name should align with your business activities and legal status.
• Avoid Religious, Governmental, and External References: Avoid names that refer to religion, government authorities, or external organizations to maintain a neutral and respectful business identity.

At filings.ae, we assist you in selecting a compliant trade name that meets local regulations and aligns with your business goals in the UAE.

Freezone Company - Business License

A business license is an official authorization of the relevant freezone authorities that permits a company to conduct specific commercial activities within a defined jurisdiction. Select one that matches your company's primary operations when applying for a business license. The allowable business activities can differ based on the specific free zone and the nature of your enterprise. Business license options encompass various categories, such as:

• Commercial/Trade
• Consultancy/Services
• Industrial
• Educational
• Media
• eCommerce
• Offshore
• Freelancer
• Warehousing
• Manufacturing.

Choose an Office Space

Selecting a suitable office space is crucial when establishing your business in a free zone. You can buy or rent office space, and the choice will depend on factors such as the size of your workforce and the nature of your business activities.

Register Business and Get Business Licence

Registering your business and obtaining the necessary licenses in a free zone involves specific steps and document submissions tailored to that zone's requirements. Here's a general outline of the essential procedures:

Initial Approval:

• Submit a completed application form.
• Provide a detailed business plan.
• Include a copy of the current trade license or registration certificate (for existing local companies).
• Submit coloured passport copies of company shareholders and the designated Manager/Director.
• Provide specimen signatures of shareholders and the appointed Manager/Director.
• For corporate entities, submit two years' audited financial reports or a personal bank reference letter for individual shareholders.
• Obtain a No Objection Certificate (NOC) from the current sponsor for individual shareholders.
• Include the unit title deed and a Letter of Intent.
• Complete the Registry Identification Code Form (RIC) for the Manager/Director (original and notarized).
• Freelancers typically require fewer documents, such as registration, a CV, a bank reference letter, and an original, notarized RIC.

Business Registration:

Upon initial approval, pay the applicable registration and license fees. Submit a completed registration application.

• Include a notarized and attested Board Resolution appointing a Manager/Director.
• Provide a notarized and attested Power of Attorney for the Manager/Director.
• Present notarized and attested Memorandum and Articles of Association.
• Submit a notarized and attested specimen signature of the Manager/Director.
• Include a passport-size photo of the Manager/Director with a white background.
• Provide share capital information.

Licensing and Visa Process:

The free zone authority will prepare lease agreements.

• Subsequently, the trade license will be issued.
• The process for visa applications will commence.

Please note that certain activities may require additional approvals from external authorities, and specific document requirements and procedures may vary depending on the free zone, business activity type, and company structure.

At filings.ae, our team of experts is ready to provide comprehensive assistance and guidance throughout this process to ensure a smooth freezone company setup for your business.

Start Freezone Company Formation with Filings.ae

Filings.ae is your trusted partner for UAE Freezone company formation. Our team of experts is well-versed in the intricacies of setting up businesses in UAE Freezones, and we are committed to providing comprehensive assistance at every stage of the process.

Contact us today to start establishing a business in the UAE Freezone.