Dubai has been an attractive place to do business in. It has become a major international hub for business. Due to its streamlined business setup process, business-friendly environment, and government support, it’s not only easy to set up a business in Dubai but also to nurture and grow.

Dubai free zones offer a cost-effective way of starting a business in Dubai. Free zones are tax-exempted areas where you don’t have to pay customs duty to import, export, or manufacture goods. This is indeed a huge relief. The only limitation in free zones is that you can only do business with other free zones or outside Dubai and not with Dubai’s local market. This is the reason free zones are generally located near national borders, international airports, and major seaports. This makes logistics easy.

There are around 30 free zones operating in Dubai and although they vary in terms of focus, setup cost, and paperwork needed, the basic requirements are the same.

Benefits of Setting up Business in Dubai Free Zone

Setting up a business in one of Dubai’s free zones comes with a lot of perks that make your entire business operations cost effective, convenient and effective. Some of the perks are the following.

• You get 100% ownership of your business, unlike a mainland business setup in which you are required to have a UAE national with at least 51% shares of the business.
• You get 100% exemption on all types of taxes, personal, corporate, or income.
• Office spaces are affordable.
• There is no requirement on the size of office space as opposed to 140 square feet in a mainland business.
• No approvals are needed from different government departments so the setup process is easy.
• You can operate 24/7.
• There are no restrictions on hiring expatriates.
• The workforce is inexpensive and the recruitment procedure is easy.

Process of Dubai Freezone Company Setup

So if you too have decided to open a company in a Dubai free zone, the following are the steps you need to follow.

1. Select a license type and business activity

Determine the business activity that you wish to carry out. This is an important decision that will determine where you can register your company and what type of business license you should apply for. Each Free Zone has different rules for the number of activities that can be added to one license.

2. Choose a Free Zone

As stated above, your chosen business activity will decide which free zones you can setup your business in. Most free zones allow for multiple business activities. Also, since each free zone varies in terms of facilities and visa quotas, you will have to choose which Free Zone will work best for the type of business activity you will have.

3. Select trade name and prepare documents

Now you have to choose a business name. Make sure your business name is not already registered and conforms to Dubai’s business naming conventions. For example, your chosen business name must not include God’s name or any of his divine attributes, offensive language, or blasphemous words. It also must not be similar to any government organization names or their abbreviations.

You have to register your trade name in the relevant free zone authority’s portal.

4. Apply for a business license

Acquiring a business license is mandatory for setting up a business in any free zone. Once you have chosen and registered your trade name, you can apply for a business license. Depending on your chosen business activity, you can apply for any of the following licenses.

• General trading license: With this license, you can trade in all kinds of products.
• Trading/Commercial license: This license allows you to operate a trading company. You will be able to have 10 similar product lines or three different product lines.
• Service license: This license is for service providers such as law firms, accounting firms, and business consultancy firms.
• Industrial license: You can import raw materials, assemble, process, redesign, or repackage goods with this license.
• Warehouse license: You need this license if you need a warehousing facility to store, distribute or package goods.
• Manufacturing license: This allows you to transfer parts of raw materials into a finished product. This includes textiles, auto parts, paper, aviation, and many more.

You need to submit the supporting documents while applying for the license.

5. Choose an office space

Office space is relatively easy and inexpensive in free zones. Free zone authorities even provide co-working space to keep the expenses to a minimum and support startups. You can also buy or lease office spaces in free zones. Office requirements depend on the number of employees and type of your business activity.

6. Get initial approval

Once you have submitted all the required documents to the relevant free zone authority, you can wait for the initial approval which can take 2-4 weeks. Once you get the license, you are good to start your business.

Documents Required

Following are the general documents that are required to be submitted. There are other documents specific to industry and license type.

• Duly filled application license form
• Business card of the contact person
• Copy of business plan
• Notarized and attested Memorandum of Association (MOA)
• Notarized Articles of Association (AOA)
• Passport copies of the partners and business managers
• Original bank reference letters and license of the partner’s existing company, if applicable

Conclusion:

If you want a truly rewarding business in Dubai with low cost, high profit, hassle-free administration coupled with business-friendly government policies, Free Zones are your ultimate solution. Setting up a business in a Dubai free zone will make your dream of a thriving business come true.

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