Dubai can easily be called a major business hub globally, and Dubai witnesses a large number of foreign investors and startups annually. One of the most popular business establishment methods is through a free zone company setup. This article will help you make a decision regarding your business setup.

Here we will go through

• What free zones are
• Benefits of freezone business establishment
• Registration process
• Documents and costs
• Top free zones for various industries
• FAQs for entrepreneurs

What is a Dubai Free Zone Company, and why should you choose it?

The free zone is a designated area in Dubai that offers special benefits for entrepreneurs. There are currently more than 40 free zones for various industries like technology, logistics, healthcare, media, and so on.

A company that is registered in this particular economic zone offers,

• Complete ownership of the business
• Complete Profit repatriation
• Optimized import and export processes
• 0% Corporate tax
• Strategic location

A few of the advantages of setting up a business in the free zone are:

100% foreign ownership

In a free zone, you are not required to have a UAE national as the sponsor

Easy Setup

Your business can often be registered within 2-4 weeks

Business Setup

If you open a UAE bank account and possess investor visas, you can operate the business internationally.

Tax benefits

Compared to other global hubs, the Dubai free zone only has 9% corporate tax

State-of-the-art Infrastructure

You can find modern offices, coworking spaces, and warehouses for startups and SMEs

Step-by-Step guide to set up a Company

Step 1: Choose the Free Zone

Depending on the industry your business falls in, choose your zone. Such as

• Dubai Media City (DMC): for media & marketing firms
• Dubai Healthcare City (DHCC): for healthcare & wellness
• Dubai Internet City (DIC): for IT & tech startups
• Dubai Multi Commodities Centre (DMCC): for trading gold, diamonds, and commodities
• Dubai International Financial Centre (DIFC): for finance & investment firms

Step 2: Choose the Business Activity

Decide what activities your business will engage in, as each activity requires a separate business license. Activities include, but are not limited to

• Consulting
• Services
• Manufacturing
• Trading
• eCommerce

 Step 3: Choose your Company’s name

The name of the business should follow the UAE naming conventions, like:

• Offensive or religious words are not allowed
• Avoid names of countries or organizations unless pre-approved
• The name should reflect the business activity

Step 4: Apply for Initial Approval

Submit the application form along with passport copies of all the shareholders and directors.

Step 5: Submit documents & Sign legal papers

Documents required to submit include:

• Passport copies of shareholders & directors
• Passport-size photographs
• Proof of residence
• Business plan – for certain activities
• NOC from current employer – if you are already in the UAE

Step 6: Lease Office space

Most businesses in the free zone require an office space. Types of office spaces are

• Dedicated office
• Warehouse facility
• Shared workspace (Flexi-desk)

Step 7: Obtain your License

Once your application is approved, the free zone will issue the business license, which allows you to legally start operating.

Step 8: Open a UAE bank account & Apply for a Visa

You should open a UAE bank account and apply for a residence visa.

Free Zone Business Setup Cost

The company setup cost can vary depending on the particular free zone, type of business license, office space, and visa requirements. Compared to other global hubs, here the investment is affordable.

Different categories of costs (in AED):

• Business license fee – 10,000 – 20,000
• Office space (flexi-desk) – 5000 – 15,000
• Registration fee – 5000v – 10,000
• Residence visa (per person) – 3000 -6000

How to overcome common challenges

• Opening Bank Account: Some UAE banks require a strong business plan and a large sum as a minimum deposit; in such cases, you can choose international banks that operate in the UAE.
• Visa Quotas: Based on office size, the number of visas provided will be limited. You can opt for a bigger office space for higher visa eligibility.
• Activity Restrictions: Certain free zones do not support some industries, so you should choose one that matches your business activity.

Dubai Free Zone is one of the most investor-friendly and cost-effective ways to set up a business. With huge benefits, including ownership and tax exemptions, you can gain global access. If you are planning to expand your business, get in touch with a licensed business consultant for more guidance and to ease the process.

FAQs

Q: What is the period required for registering a business?

A: It takes around 2-4 weeks for approvals

Q: Do I need a UAE sponsor?

A: No, Free Zones allow 100% ownership of your company

Q: Can I operate from outside the UAE?

A: Yes, you are allowed to operate from foreign countries with your business in the free zone

Q: What is the minimum capital requirement?

A: It varies in each free zone; some require AED 5000-10000, while others have no minimum

Q: Can I hire employees?

A: Yes, you can hire and sponsor employees with a visa, depending on your office space and quota.