What is a Free Zone Company?

Free zones, often referred to as free trade zones, are economic areas where goods and services can be exchanged at preferential tax and customs rates. While they are sometimes confused with offshore corporations, they are not the same. Free Zone Company Formation in Dubai involves creating onshore entities that can do business in Dubai if certain requirements are met. Offshore companies, on the other hand, are formed specifically to conduct business outside of their registration jurisdiction or the location of their principal owner.

The UAE boasts around 67 free zones, with new ones being added annually. Over 150,000 enterprises operate within these free zones, and this number continues to grow.

The approximate cost of establishing a free zone company in Dubai is AED 11,900, though fees vary depending on the chosen free zone and visa requirements.

Notably, free zone companies can now establish branch offices on the mainland. To do this, the investor must register the branch with the Department of Economic Development (DED) and the Ministry of Economy under the same commercial name. Unlike the previous requirement of having a local partner, the free zone company can now fully own the branch.


Key Steps to Free Zone Company Formation in Dubai

Here are the detailed steps to set up a free zone company in Dubai:

  1. Determine the Type of Legal Entity Decide on the legal structure for your company, such as a limited liability company (LLC), branch office, or subsidiary. This decision depends on factors like ownership, liability, and operational requirements.
  2. Choose a Trading Name Select a unique and appropriate name for your company that complies with the regulations set by the free zone authority. Check for name availability and ensure it aligns with your business activities.
  3. Apply for a Business License Apply for a business license from the relevant free zone authority. The license specifies the activities your company can engage in and is essential for conducting business legally in Dubai.
  4. Choose an Office Space Depending on the free zone regulations, select an office space within the designated free zone area. Options typically include flexi desks, shared offices, or dedicated office spaces to cater to different business needs.
  5. Obtain Pre-approvals and Acquire the Necessary License After finalizing the legal entity, trading name, and office space, obtain pre-approvals from the free zone authority. This involves submitting required documents, such as a business plan, shareholder details, and passport copies. After receiving the necessary approvals, proceed with registering your company and obtaining the business license, allowing you to operate legally within the chosen free zone.

Adhering to this procedure ensures a smooth and successful setup process within the free zone. The government has streamlined the process to be investor-friendly, and the entire process typically takes no more than four weeks to complete.


Advantages of Free Zone Business Setup in Dubai

Setting up a business in a Dubai free zone offers several advantages:

  1. Complete Ownership of Business Free zone company formation allows 100% foreign ownership, unlike mainland companies that typically require a local sponsor or partner. This provides greater control and flexibility in managing the business.
  2. Full Profit Repatriation Profits from free zone enterprises can be repatriated outside the UAE, allowing businesses to transfer 100% of their capital to their country of origin without any restrictions.
  3. 9% Corporate Tax Companies with revenue less than AED 375,000 are exempt from corporate tax, aiding small businesses. Those with revenue above AED 375,000 pay a 9% corporate tax.
  4. Simplified Import and Export Processes Free zones offer simplified import and export processes, exempting businesses from customs duties on imported and exported goods.
  5. Strategic Location Free zones in Dubai are strategically located near seaports, airports, and national borders, enhancing supply chain efficiency and reducing shipping costs.
  6. Global Connectivity Dubai’s major seaports and airports facilitate local and international trade, providing easy access to distributors and manufacturers in the MENA region and South Asia.
  7. Thriving Expat Entrepreneurs Dubai’s multi-national community allows businesses to connect with a global business community, attracting millions of tourists and investors.
  8. Range of Business Activities Free zones accommodate diverse business activities, from trading, manufacturing, and services to technology, media, healthcare, and consulting.
  9. Time-saving and Simple Registration Process The registration process is quick and straightforward, providing easy access to free zone company formation and convenient administrative services.


Documents Required for Free Zone Company Formation in Dubai

Investors need to submit several documents for approval from the Gulf Cooperation Council or the Arab embassy, including:

  • Application license form
  • Business card
  • Business plan outline
  • Memorandum of Association (MOA) and Articles of Association (AOA)
  • Passport copies
  • Banking reference and license of the partner’s existing business (if required)


Register Your Free Zone Company with Aristotle Consultancy

Company formation in Dubai free zones offers numerous advantages, including 100% foreign ownership, tax benefits, and full profit repatriation. Dubai’s strategic location, global connectivity, and thriving expat community provide access to diverse markets. With simplified import/export processes, a wide range of business activities, and a streamlined registration process, Dubai’s free zones attract entrepreneurs seeking a dynamic market.

Aristotle Consultancy provides comprehensive assistance for setting up your business in Dubai’s free zones. Our experienced professionals guide you through legal entity selection, trading name choices, and business license applications. We help with office space selection, handle documentation and pre-approvals, and ensure a smooth registration process. With our expertise in free zone regulations, we optimize the advantages of free zone business setup. Contact us today to start your business journey in Dubai’s thriving free zones.


Contact Aristotle Consultancy for Free Zone Company Formation in Dubai

If you need advice on Free Zone Company Formation in Dubai, UAE, contact Aristotle Consultancy. We have been helping entrepreneurs form their companies in the UAE for nearly 20 years now. Book your free consultation with our company formation experts today!

Call us on +91 9958605588 or WhatsApp us on +91 9958605588. You may also email us at info@aristotleconsultancy.com