Free zones in UAE
The UAE has been excelling economically over the last few decades and the lion’s share of the credit goes to free zones! Free zones are the strongest pillars of UAE’s economy, that generate billions of jobs and helps in boosting foreign investment. They help spur economic diversification and contribute significantly to the non-oil sector.
Companies find UAE free zones a feasible location to setup their business, due to its features that include business-accommodating laws, easier labour and immigration procedures and tax structures.
Setting up a business in UAE is quite easy as they require minimum paperwork and duration. The initial step involves determining the type of legal entity, then choosing the trade name, applying for a business license, choosing an office space and getting pre-approvals and registering your business.
UAE is home to more than 50 free zones, that offer a wide range of business activities in fields such as energy, commodities, gold and diamonds, technology, constructions, aviation and many more.
In a free zone, you can set up two types of companies; Free Zone Establishment (FZE) and Free Zone Limited Liability Company (FZ LLC). FZE is a single shareholder limited liability company, whereas FZC allows multiple shareholding (maximum 5). Companies can also establish a branch, a representative office or a subsidiary company of their existing or parent company.
The requirement for capital while setting up a Free Zones company in Dubai, UAE varies from one free zone to another. You can set up a free zone company at twofour54, without any capital, whereas in KIZAD , one need to pay AED 150,000 to form an LLC. In Dubai Airport Free Zone , an FZ Co. can be formed with a minimum share capital of AED 1000.
The minimum share capital for forming a free zone company in DMCC is AED 50,000 per company and AED 10,000 per shareholder. In Hamriya Free Zone , you can form an FZE with a share capital of AED 150,000.
An independent free zone authority governs each free zone and is the agency responsible for issuing free zone operating licenses and assisting companies with establishing their business in the zones. A free zone firm is governed by the rules and regulations of the free zone in which it is established.