Our top 5 Free Zone recommendations

The UAE has established itself as a major international business hub and is known as the trade and commerce destination in the Middle East. It offers a dynamic business environment for expanding or starting a business. Over 40 free zones located across the Emirates allow you to easily set up a business with more than 2000 activities across various business categories. A free zone is particularly attractive because it offers global investors a wide range of benefits such as:

  • 100% foreign ownership
  • Corporate tax exemptions until the introduction of the new UAE corporate tax regime in 2023. Income earned from transactions with businesses in third countries as well as in other free zones and passive incomes from the mainland will still benefit from the 0% corporate tax rate, if there is no branch on the mainland or business with mainland customers.
  • No taxes on personal income or capital
  • 100% repatriation of capital and profits
  • Duty-free for import or export
  • Attractive working environment
  • Liberal labor law and visa regulations
  • No currency controls
  • Less bureaucracy in the recruitment process (the labor-intensive wage protection system is not yet applicable)
  • Availability of offices, storage facilities, and production areas

The choice of the right free zone for establishing a business is one of the most important decisions entrepreneurs have to make. However, there are factors that also need to be considered such as business activities, costs, facilities, incorporation requirements, and procedures as not all free zones could be suitable for your needs. The following are factors to consider when selecting a location for establishing a company:

  • Type and scope of planned business activity;
  • Personnel and visa requirements for the proposed company;
  • Budget for starting a business;
  • Logistical location and infrastructure;
  • Licensing of the free zone in relation to the intended activity;
  • The process of setting up a company and the necessary documents and costs;
  • Size and rental costs of required office, storage or industrial space;
  • Recurring costs (e.g. for annual license renewal);
  • Scope of services offered;
  • Hidden Fees; and
  • other specific regulations.

You can’t decide which UAE-free zone to choose? We have put up our personal list of the top 5 free zone recommendations.

  1. International Free Zone Authority (IFZA)

IFZA is located in Dubai providing competitive Free Zone License packages, and fast and straightforward incorporation. License types include: professional, commercial, industrial, and branch. In IFZA, several activities can be combined under one license.

  1. Professional License – For businesses providing professional consultancy and multiple types of services.
  2. Commercial License – Authorizes the import, export, distribution, and storage of specified items.
  3. Industrial License – Allows the import of raw material, manufacture, process, packaging, and export of specified products.
  4. Branch – Allows foreign companies to open a branch. The activity of the proposed branch needs to correspond to the activity conducted by the parent company. Branches need to conduct the same activity as their parent companies.

Overview of costs

Process Estimated costs
Company formation (registration, license) Approx. AED 17,000 – 27,000
Renting an office space Flexi desks from just AED 6,000 per year; office space rates depend on the size
License Renewal Starting at around AED 10,000
Work Visa Starting at AED 4,500-6,500
  1. Ras Al Khaimah Economic Zone (RAKEZ)

In early 2017, Ras Al Khaimah Economic Zone (RAKEZ) was formed from the merger of Ras Al Khaimah Economic Zone (RAKEZ) and RAK Investment Authority (RAKIA). RAKEZ provides modern facilities, cost-effective setup packages, and top-quality services. It also offers a variety of licenses and activities at moderate costs compared with free zones in Abu Dhabi and Dubai. License types include: commercial, educational, e-commerce, general trading, individual/professional, industrial, media, professional, service, and freelancer permits. Furthermore, RAKEZ has six dedicated zones to provide services for all your business requirements.

  1. Al Ghail Industrial Zone – ideal for investors looking to establish large-scale industrial manufacturing enterprises with land plots of various sizes from 5,000 m2 and allows you to lease or build on-site accommodations for your manpower.
  2. Al Hamra Industrial Hub – for light industries as well as heavy industry projects. It gives investors options of establishing free zone and non-free zone entities. It provides land plots, warehouses, labour accommodation, and offices.
  3. RAKEZ Academic Zone – its purpose is to attract and support educational institutions, training providers, and professional development providers. It provides offices for education support, consultancy and training, pre-built buildings for startup Higher Education Providers (HEP), and land which is ideal for building your school.
  4. Al Hulaila Industrial Zone – area dedicated for heavy industrial manufacturing. It provides land, offices, warehouses, and labour accommodation.
  5. Al Nakheel Business Zone – hub dedicated for startups, entrepreneurs, freelancers and SMEs. It offers shared workstations and private offices.
  6. Al Hamra Business Zone – offers easy access to commercial establishments, logistical hubs and premier leisure and residential developments offering shared workstations and private offices.

Overview of costs

Process Estimated costs
Company formation (registration, license) Starting from AED 11,000 – 20,000 depending on the activity
Renting an office space Starting from AED 7,500 for a flexi desk
License Renewal Starting from AED 6,000
Work Visa Starting from AED 4,000-6,500
  1. Dubai Multi Commodities Centre (DMCC)

DMCC was established by the Dubai government in 2002 to facilitate trade flows through the city. It is one of the world’s most interconnected free zones and the world’s main commodities trade and enterprise hub. Commercial properties, office buildings, serviced offices, and business centers are available at DMCC. It comprises of 19,000 registered companies, 87 residential and commercial towers, and over 600 retail outlets. Furthermore, it offers a wide range of financial services, trading resources, and investment platforms for all your financial needs. The DMCC has won the ‘Global Free Zone of the Year’ award six times by the Financial Times fDi Magazine.

Overview of costs

Process Estimated costs
Company formation (registration, license) Packages starting at around AED 35,000
Rent of an office space Starting at AED 17,500 for a flexi desk; AED 28,500 for service desk; AED 50,000 for serviced offices and AED 80/sq. ft. for regular offices
License Renewal Starting at AED 22,000 depending on the activity
Work Visa Starting at AED 4,500-7,000
  1. Jebel Ali Free Zone Authority (JAFZA)

Established in 1985, Jebel Ali Free Zone is the oldest free zone in the UAE and is one of the world’s largest free zones specializing in industry, trade, and logistics. JAFZA is currently home to 8,700+ businesses from over 130 countries. It is located in the far western part of Dubai and occupies 57 square kilometers on both sides of Sheikh Zayed Road, close to Jebel Ali Port. Jafza offers five different license types: trading, service, industrial, logistics, and e-commerce. In addition to a variety of license types and license activities, Jafza offers five formation types based on the number of shareholders and the nature of the business. You can set up your business as: Free Zone Establishment, Free Zone Company, Public Listed Company, Branch of a Company, or an Offshore Company.

Overview of costs

Process Estimated costs
Company formation (registration, license) Between AED 15,000 and AED 30,000
Renting an office Starting at AED 2,000 per m²
License Renewal Depending on the type of license
Work Visa Starting at AED 4,500-6,500
  1. Sharjah Airport International Free Zone (SAIF Zone)

SAIF Zone is strategically located near seaports and airports and has attracted over 8,000 companies from 160 countries. It offers various facilities from flexi desks and offices, to storage facilities and labour accommodations, F&B outlets, medical clinics and pharmacies, and multiple plot sizes. There are three types of licenses offered by the SAIF Zone, namely trade, service, and industrial. Additionally, Saif Zone offers business financing solutions to SME’s and start-ups, such as capex financing for facility upgrades and expansion, greenfield and brownfield project financing, and financial assistance for integrating Industry 4.0 technologies or clean energy transformation.

Overview of costs

Process Estimated costs
Company formation

(registration, license)

Starting at around AED 13,000
Renting an office Starting at around AED 15,000 for an executive desk, AED 40,000 for an executive office, and AED 55,000 for warehouses
License Renewal Varies by activity
Work Visa Starting at AED 4,000-6,500

Free zones are always updating their procedures, prices, and requirements to suit the needs of their clients. They sometimes offer promotional discounts, such as free use of flexi desks for a year, free lifetime visas, or free insurance. Visa fees vary depending on the free zone that you apply through. In the UAE, there are two common types of free zone visas. First, there is the investor visa, which is usually obtained when setting up a business in a free zone and is generally valid for three years. The second type is the employment visa which allows companies to sponsor their employees. Always note that additional fees apply to visas when requested on an urgent basis. Company formation and license fees are generally affordable in the UAE but it always varies depending on your business activity. In many cases, license renewal fees may vary from the initial license fee charged in the first year.

For more details about the various incorporation and registration requirements for a business in the UAE, it is advisable to seek legal advice and local guidance. After working in this field for decades, our team of experts at Strohal Legal Group is highly familiar with the circumstances in the local markets and will guide you through the entire process in a professional and time-efficient manner. Whether you are an international corporation or a small family business, we will handle the entire process for you. For more information on UAE business establishment, please visit our website.

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