Dubai is considered the business capital of the country, which makes it the first destination for investors and businessmen to start their own project or expand their current business. But first, they have to determine the type of business and its requirements, then learn the steps to establish a company in the Dubai Free Zone, this emirate that is considered the economic capital of the country.

Advantages of starting a business in Dubai free zones

What is a free zone in Dubai and what are the benefits of starting a business or establishing a company in the Dubai free zone? Simply put, free zones in Dubai are economic zones launched by the government and offer:

• Corporate and personal tax exemptions, customs benefits and other incentives for foreign investors.
• Dispose of the profits in full without any reduction.
• Fully sole proprietorship.
• No restrictions on cash transactions.
• Full exemption from import and export tax.

These special rules and regulations have been set by the government to establish such free zones in Dubai. Apart from all the above, it should be noted that opening a business in non-free zones requires a local sponsor who owns 51% of the business, and although this law was amended in 2018, many investors prefer to set up a company in the Dubai free zone due to the above-mentioned tax benefits.

Establishing a company in Dubai Free Zone

When starting a business in the free zones in Dubai, a number of legal points and steps must be taken into consideration, which are:

• The legal form of the company, whether a company, a branch of a company, or an institution
• Specify the company name
• Choosing a company headquarters within the Dubai free zones
• Obtaining the license and initial approval to practice the work

Types of Free Zones in Dubai

There are two types of free zones in Dubai:

• Free Zone Company – Limited Liability
• Free Zone Establishment

The difference between the two types is in the number of shareholders and their legal status, whether they are natural or legal. Also, each free zone in Dubai includes a set of rules specific to it, and therefore business owners must ensure that the company’s status is consistent with the legal requirements of the free zone in which they wish to operate.

There are more than 30 free zones in Dubai, and this number is increasing. We will list some of the most popular areas that individuals resort to in order to establish a company in the Dubai Free Zone:

• Dubai Airport Free Zone
• Dubai Design District
• Dubai Healthcare City
• Dubai International Academic City
• Dubai Internet City
• Dubai International Financial Centre
• Knowledge Park in Dubai
• Dubai Media City
• Gold and Diamond Complex
• Dubai Multi Commodities Centre
• Dubai Silicon Oasis
• Jebel Ali Free Zone Authority
• Dubai Production City
• Dubai South
• Dubai Media Production City
• Dubai Studio City

Licenses required when establishing a company in the Dubai Free Zone. It is also necessary to determine the commercial activity to be practiced, in order to identify the appropriate free zone.

Before taking any concrete steps to establish a company in the Dubai Free Zone, it is necessary to first determine the business activity that you want to work in. After that, you must determine the size of the company (working alone or employing employees), and then know the type of license that suits the type of business activity, as the Dubai Free Zones allow multiple activities under one license, taking into account that all businesses and activities are subject to the same license as specified by the licensing authority.

Choosing a suitable name for the company

When choosing the name of the business activity that is being established in the Dubai Free Zone, several things must be taken into consideration, the most important of which is that the name should attract the market segment that is to be targeted, and the name should not be related to any religious or political references. After that, it is verified whether it is available for registration through the government’s website.

The right choice for Dubai Free Zone

Choosing the right Dubai free zone is essential for the future of business. The first step is to determine the type of business activity you want to operate. Accordingly, the second step is to identify one of the Dubai free zones that is most suitable for this business. It is important to note that some Dubai free zones only allow selected activities to operate. Therefore, the choice is made according to the product or service you want to work on and introduce to the market.

We at our company will help you determine the most suitable and cheapest free zone in Dubai that precisely suits your needs and future aspirations for growth and prosperity. This point alone can cost you the loss of your investment as a result of not choosing the right free zone from the beginning of establishing your project, which wastes your time, effort and money in a free zone that was not prepared specifically for your business. Contact us.

For example, if the company’s business is in the field of advertising, the most suitable free zone to host it is Dubai Media City. The free zones in Dubai are distinguished by being in the middle of the residential areas in the emirate. Dubai Silicon Oasis is a free zone in Dubai that hosts many properties for rent, and is a 20-minute drive from the Dubai Airport Free Zone. While we find that the Jebel Ali Free Zone includes a group of warehouses for rent as well.

Documents and papers required to register a company in the Dubai Free Zone

• The Board of Directors’ decision to appoint a director for the company is officially documented and certified by a notary public.
• A legal agency through which the director is authorized, officially notarized and certified by a notary public as well.
• The company’s articles of association and memorandum of association, notarized and certified by a notary public.
• Officially notarized signature form of the director, certified by a notary public
• Director’s profile picture with white background
• Information about the share capital

Create a company bank account

Opening a bank account when establishing a company in the Dubai Free Zone requires submitting some required documents and papers, which are:

• Corporate Bank Account Opening Form.
• A decision by the Board of Directors to approve the authenticated signatures of the partners.
• Company incorporation certificate (copy).
• Company Memorandum and Articles of Association (copy).
• Passports of all partners (copies).
• Some banks also have a minimum cash balance that can range from AED 5,000 to AED 200,000.

Cost of a business license in Dubai Free Zone

Each free zone in Dubai has its own set of capital rules. For example, Jebel Ali Free Zone has no minimum capital requirement. However, the company must have sufficient capital to secure funding for the licensed activities. The minimum capital requirement in Dubai Airport Free Zone is AED 1,000.

Similarly, DMCC requires a minimum capital of AED 50,000 per company and AED 10,000 per shareholder. Therefore, the funds required to start a business in Dubai free zones depend on the area and field chosen.

Opening a branch of an existing company

Many business owners are looking to expand and open new offices in Dubai free zones. This is allowed, but according to several rules that have been set by the Dubai government in this regard.