How to Set up a Business in Dubai Free Zones

How to Set up a Business in Dubai Free Zones

If you are an investor with a strong ambition to set up a business in Dubai, the first thing you have to finalize is whether to choose the mainland or free zone to start a company in Dubai. It is a strategic decision as both types of company formation in Dubai have their own unique advantage. Analyse your priorities and if you want to go for a quicker and easier business setup process with added benefits such as 100% ownership and zero corporate tax, then free zones are the ideal jurisdiction for your business setup in Dubai. There are around 44 free zones in the UAE and around 30 of them are in Dubai. Since launching your business in a free zone is a strategic decision, expert guidance, and assistance of a reputed business set up consultant in Dubai is recommended.

Features of Company Formation Process in Dubai Free Zones

Free Zones in Dubai are special economic zones typically located in strategic locations such as international borders, airports, and seaports to provide maximum benefits for foreign investors. The easy connectivity through air, sea, and land is an advantage for the import/export plans of the investors.

The Dubai free zones are regulated by the respective free zone authorities that register and issues trade licenses to the businesses operating within the free zone. This is in stark contrast to the mainland business setup where the processes of registration and business license issuance are carried out by the Department of Economic Development (DED) of the respective emirates.

There are many free zones in Dubai that are dedicated to specific business sectors or areas of innovation. For example, establishing a business in Dubai Media City is especially suited for media companies, while Dubai Silicon Oasis (DSOA) is dedicated to modern technology-based industries.

Dubai Free Zones offer foreign investors an opportunity to start their company in specific industries of their choice while enjoying greater tax benefits. Unlike, the mainland company formation launching a business in free zones requires fewer procedures and with the help of company formation experts in Dubai, the process can be completed without any hassle.

The Key Steps in Starting a Company in Dubai Free Zones

1.Choose a Business Activity

The first and a key step in the business setup in dubai free zone is deciding on the business activity that the company will conduct in the free zone. The activity determines the types of licenses that will be issued to the company such as professional, commercial, or Industrial licenses.

2. Find the Right Free Zone

Finding the right free zone is an important task for setting up a business in an efficient manner. You should consider the facilities, types of licenses, and the permitted activities in the free zone before finalizing the right free zone for your business setup in Dubai. Sometimes investors will prefer sector-specific free zones that match with the activities of the proposed company. Some of the most prominent sector-specific free zones in Dubai are

  1. Dubai Healthcare City
  2. Dubai Maritime City
  3. Dubai Science Park
  4. Dubai Outsource City

If you are not keen on starting your dream venture in an industry-specific free zone, then there other free zones that offer a wide range of business activities like DMCC, Dubai South, etc.

3. Choose a Company Name

There are certain general guidelines that need to be followed to reserve a trade name for the business. The trade name could not be registered if it violates certain legal prerequisites. The following are some of the instances of trade name violations.

It is copyrighted

Has Indecent or vulgar words

Names of Emirates

4. Indicates attributes of God’s names

These are only a few of the rules that govern the laws of trade names. The entrepreneurs need to be careful while reserving a trade name with the relevant free zone authority.

5. Choose Legal Form of the Company

Investors can set up mainly Free Zone Company (FZC) and Free Zone Establishments (FZE) in Dubai free zones. Apart from that foreign and local companies are allowed to establish their branches within the free zones. However, not all free zones allow all legal forms and if a company needs to establish a branch then the investor needs to identify the free zones that allow the formation of a branch.

6. Application for License

Every free zone in Dubai has an easy and quick application process. The companies need to apply for the license that is associated with their activity. Generally free zones offer professional, commercial, and industrial licenses. However, there are other free zones that offer freelance licenses and other special license packages. Jebel Ali Free Zone Authority (JAFZA) offers e-commerce, and innovation licenses, which makes the company formation in Dubai more attractive.

7. Choosing the Facilities

Every business needs the right facility that facilitates its operations and will have an impact on its growth prospects. If the company is not planning an extensive expansion in one or two years from the date of incorporation then getting a shared or a flexi desk facility at a co-working space would be better. Start-ups, free lancers and the companies that plan to hire less number of employees often avail the benefits of co-working spaces in Dubai free zones. Companies that require arranging regular meetings with the clients and having a larger number of employees are advised to choose a physical office within a free zone. Also, manufacturing companies need to consider the availability of the plot of land or robust warehouse facilities within the free zones while setting up a business in Dubai

8. Submission of Required Documents

The companies need to submit the checklist of documents required to be submitted to the free zone authority to obtain the license. In most of the free zones in Dubai, the process of company incorporation could be completed if proper documentation is done. The expert assistance of reputed business setup consultants in Dubai would facilitate a quicker company formation process.

Why Should You Use Business Setup Consultants in Dubai?

Setting up a business in a Dubai free zone is ideal for the foreign investors who can enjoy benefits of 100% ownership, and repatriation of capital among other benefits. Free Zones in Dubai are well-developed with modern infrastructure and the business set up process is faster. However, if you are a foreign investor then trying to start a business alone would be a bad idea and will consume your precious time and resources. Right from registration to incorporation, the procedures require careful documentation powered by in-depth knowledge of regulatory requirements. This is where a reputed company formation expert like handy for a foreign investor like you. Business setup consultants are well-versed in all the laws and regulations and can take care of all the paper works for registration and visas for you and your family. With expert assistance and guidance the investors can set up a business peacefully in any of the Dubai Free Zones.

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