The UAE is one of the most appealing states in the world for investors. However, just as attractive are the numerous free zones spread across the country. So, here is a dilemma: which free zone do you choose if you open a company in Dubai?
Below, our lawyers in Dubai have compared the procedure of company formation in Dubai with other emirates and some of the most popular free zones in the UAE.
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Differences between company incorporation in Dubai and free zones
Business is one of the most popular options when it comes to immigration to Dubai. Apart from the dedicated investor visas, you can also move here and simply open a company. However, you will need to make a decision: whether to create the enterprise in Dubai or another Emirate (mainland companies) or in a free zone. The main differences between mainland and free zone companies are:
- licensing – free zone companies are created for specific activities;
- taxation – free zones offer more tax benefits compared to Dubai or Ras Al Khaimah, for example;
- operations – free zone companies can operate in the free zones they are registered in and outside the UAE, while mainland companies can operate all over the UAE and outside it.
But what are the most appealing free zones? Our article will focus on:
- Dubai International Financial Center;
- Jebel Ali Free Zone Authority (JAFZA);
- Dubai Multi Commodities Centre (DMCC) ;
- International Free Zone Authority (IFZA);
- Fujairah Creative City Free Zone;
- Sharjah Media City Free Zone (Shams);
- Sharjah Publishing City Free Zone (SPCFZ);
- Dubai Internet City (DIC);
- Dubai Silicon Oasis (DSO);
- Dubai Healthcare City (DHCC);
- Dubai Airport Free Zone Authority (DAFZA);
- Meydan Free Zone (MFZ).
In addition, we will also review the procedure of setting up a company in Ras Al Khaimah.
How to open a company in Dubai International Financial Center
Dubai International Financial Center allows you to set up any type of company, including general and limited partnerships. Its greatest advantage is that, while being designated to financial and insurance activities, it also enables you to open a business for trading operations. The available licenses in the free zone are:
- the financial license;
- the innovation license;
- the crowdfunding license;
- the investment advisor license;
- the Payment Service Provider (PSP) license.
In addition, companies can also file for general trading licenses that enable them to carry out other activities than financial ones. The procedure to set up a company in Dubai International Financial Center takes 6 to 8 weeks for unregulated activities and up to 6 months for finance-related ones.
How to open a company in Jebel Ali Free Zone Authority (JAFZA)
If you are interested in company formation outside Dubai, Jebel Ali Free Zone Authority can be a good choice. Here, you can register free zone companies and establishments, branch offices, public and offshore companies. The licenses you can obtain are for the following operations:
- trading;
- logistics;
- service providing;
- industrial-related activities.
Here, the maximum timeframe to open a company is 14 business days.
Company incorporation in Dubai Multi Commodities Centre (DMCC)
Located at the very heart of Dubai, DMCC is a free zone that deals in commodities exchange, such as:
- precious metals;
- energy;
- metals;
- agricultural products.
However, in 2021 the DMCC also issued the first сrypto assets trading license enabling investors to pay in virtual currency for the traded commodities. If you want to open a company in Dubai in this free zone, you can choose between:
- free zone companies;
- free zone establishments;
- branches of foreign companies.
In terms of licenses available, the DMCC authority issues:
- trading permits;
- service licenses;
- industrial licenses.
With availably of full foreign ownership and no personal income tax, this is also the place you can live in Dubai after you start your company. You can rely on our immigration lawyers in Dubai for support in this case.
How to set up a business in International Free Zone Authority (IFZA)
International Free Zone Authority offers multiple benefits to investors who want to operate here. Among them, we mention the following:
- the possibility of setting traditional business forms such as free zone companies;
- access to several types of business licenses;
- no travel requirements if you want to open a company here.
So, if you want to establish a company in IFZA, you can rely on our law firm in Dubai for remote registration services.
With respect to the license you can obtain in this free zone, these are:
- trading license;
- the commercial license;
- the professional license;
- the branch license.
What is unique about this free zone is that you can combine more activities under one license. With a quick registration process of only 5 business days, this may be a great fit for your future company.
What to consider when opening a company in Fujairah Creative City Free Zone
Fujairah Creative City Free Zone is dedicated to operating in the media sector, as its name suggests. However, you can also develop other activities, such as HoReCa or even IT, for which you need to apply for general licenses. In addition, you can also obtain industrial and services business permits.
The most important aspect of this free zone is that its authority does not require businesspersons or companies to have a physical location in Fujairah. This makes a great place for freelancers, for example, who can also apply for the Dubai freelance visa.
Sharjah Media City (Shams) and Sharjah Publishing City (SPCFZ) free zones
Sharjah is the 3rd largest Emirate in the UAE. There, you can set up free zone companies in:
- Sharjah Media City;
- Sharjah Publishing City.
Sharjah Media City or Shams is one of the newest free zones in the UAE and you can set up a company in it or operate as a freelancer. Apart from the regular licenses that enable you to trade, offer services, or carry out industrial activities, you can also apply for a holding license. More importantly, you can create a company in Shams fully remote. You can rely on our lawyers in Dubai for support in this case.
In the case of Sharjah Publishing City, you must first apply for the trade license. Following that, you can register your company. This free zone is known for its excellent facilities provided to businesses operating in the publishing sector. One of the most important is that you can secure a business permit for operating in the free zone and Sharjah mainland.
Why open a company in Dubai Internet City (DIC)
If you want to set up a company in Dubai or one of its free zones, you can include Dubai Internet City on your list. What you need to consider about this free zone is that:
- you can obtain a trading, service, professional or freelance license;
- to open a company in DIC, you must also secure a minimum share capital of AED 50,000 or approximately USD 14,000;
- you can set up a free zone company or expand a business through a branch or subsidiary.
No matter the type of company formation service you are interested in Dubai, you can rely on our local law firm.
Company incorporation in Dubai Silicon Oasis
Among the sectors you can operate if you want to open a company in Dubai Silicon Oasis are:
- marketing;
- hospitality and tourism;
- trading;
- education;
- logistics;
- transportation;
- manufacturing;
- healthcare.
An important aspect to consider about this free zone is that most of the steps of opening a company can be completed online, including the licensing phase. This way, it will take a few days only to obtain all the approvals and start operating.
How to open a company in Dubai Healthcare City (DHCC)
There are two ways to operate in Dubai Healthcare City Free Zone:
- by starting a company under a commercial license;
- as a professional under the Dubai investment visa which enables you to obtain a 10-year renewable residence permit.
If you decide to launch a company, the following share capital requirements must be respected:
- AED 50,000 (approx. USD14,000) for commercial companies;
- AED 300,000 (around USD 82,000) for healthcare clinics.
Company formation requirements in Dubai Airport Free Zone Authority (DAFZA)
DAFAZA is one of the free zones in which you can obtain several licenses. Apart from trading, industrial, and services permits, the following are also available:
- the dual license, under which you do not need a physical office space and that enables you to operate outside the free zone as well;
- the talent pass license, which enables you to carry out activities in the media, technology, or education sectors as a freelancer.
How to open a company in Meydan Free Zone (MFZ)
Meydan Free Zone is one of the central free trade areas in Dubai, which boasts one of the quickest registration procedures. It also has some of the lowest company incorporation fees in Dubai.
The main advantage of opening a company in MFZ is that it enables you to carry out various types of activities under one single permit, named simply the business license. Among these operations, we mention the following:
- advertising;
- education;
- financial;
- real estate-related activities;
- logistics.
Business set up in Ras Al Khaimah
Ras Al Khaimah or RAK is an appealing Emirate to do business in both on mainland and in its free zones. If you want to open a company there, you can apply for one of the following 4 types of business permits:
- the commercial one;
- the general trading one;
- the industrial one;
- the services one.
The Emirate also allows for the registration of several types of companies, among which are limited liability companies, branches, and agent services establishments, free zone companies. It is also possible to set up offshore companies in RAK.
The minimum share capital for a mainland company in RAK is AED 10,000 (approx. USD 2,700), while for a free zone establishment, it is AED 100,000 (approx. USD 27,000).
After carefully considering where and the type of company you can open in Dubai, feel free to contact our lawyers for support with the incorporation procedures.