Top 7 free Zones in the UAE
Free Zones (or Free Trade Zones) were originally set up to boost international business, allowing companies to have 100% foreign ownership and offering preferential rates and taxes. As Free Zones expanded across the UAE they began to specialize in specific industries and niches, each offering its own specific set of competitive advantages. Each zone has its own rules and is governed by its authority.
There are more than 45 Free zones in the UAE spread across Dubai, Abu Dhabi, Sharjah, Fujairah, Ajman, Ras al Khaimah, and Umm-al-Quwain. All of these are providing the best of the facilities and incentives to businesses.
Choosing the right free zone in the UAE is a challenge that requires an effective strategy in place to suit the business plan, and therefore it makes sense to seek advice from the right business setup consultants.
What are the advantages of a free zone?
100% foreign ownership
100% free transfer of funds
100% exemption from import and export duties
100% repatriation of capital and profits
Corporate and personal tax exemptions
Documentation is less and more suited to foreign investors
These benefits and more make Free trade zone business setup an attractive option for investors and entrepreneurs. However there are a few limitations to setting up a business in Free Zones in the UAE:
Limitation of activities
A free zone company setup has limitations on activities. This is based on the specific specialization of the jurisdiction and its governance.
Restricted to certain locations
A Free zone company setup limits choices of office spaces available. This is because there is a requirement for companies to set up within the Free zone jurisdiction.
Restrictions on expansion Onshore
The disadvantages of a free zone company in Dubai includes confinement to the business activity of the particular free zone. Expansion into other UAE markets is not permitted.
Trade Restrictions within UAE
Despite a lot of benefits, companies can have more difficulty in trading with companies outside their free zone. Most find it necessary to hire a commercial agent or distributor onshore to do business. The law technically prohibits free zone trade with the rest of the country.
While there are pros and cons to setting up a business within a Free Zone the pros outweigh the cons and hence with the help of detailed statistics, we will highlight the Top 5 Free Zones in the UAE in no particular order.
Dubai Multi Commodities Centre ( DMCC ) Free Zone
Dubai Multi Commodities Centre (DMCC) is not only the current winner of the world’s best Free Zone award 2020 by FDI, but in fact, it has achieved this milestone for the 6th consecutive year (2015 - 2020). DMCC is one of the popular Freezone for Commodity trading companies. It offers innovative infrastructure, world-class services, and a robust ecosystem for company formation.
DMCC is the region’s dedicated trading center and thriving marketplace for businesses in the field of commodities, financial services, and a growing range of specialist industries. It’s also the fastest-growing free trade zone in the world. Within easy reach of entry and exit points in Dubai and the Expo2020 site, it’s connected to the most prominent retail, residential, and tourist districts in the region. Made for Trade, it brings together more than 19,000 businesses from all sectors and industries into the world’s most interconnected Free Zone.
DMCC offers investors an easy business setup, residence visa, plug-and-play offices, ease lease and sale options for offices, networking opportunities like events, workshops, and exhibitions, etc. The Trading companies have easy access to trading commodity exchange that trades items like gold, diamond, and other commodities. DMCC also provides investors with trade regulations and compliance standard training to be aware of the legal framework.
Ras al Khaimah Economic Zone (RAKEZ)
Ras al Khaimah (RAKEZ) is ranked eighth in the Global Free Zones of the year 2020 list by FDI. RAKEZ is the best when it comes to affordability. It is particularly attractive to entrepreneurs and investors for its low business setup fee and the generous incentives it provides to business partners.
Blessed with a strategic location, RAKEZ connects investors to growing markets of the Middle East, North Africa, Europe, and South and Central Asia. The free trade zone currently hosts more than 15000 thousand international and multinational companies, representing over fifty sectors and a hundred countries.RAKEZ is one of the few Free Zones which always has customizable warehouses and plots of industrial land for development.
The free trade zone of RAKEZ has 4 distinct segments being designated for various industries:
- Business park for office clients
- Industrial park for heavy manufacturing
- Industrial park for light manufacturing and trading, which is a technology park
- An educational or academic zone that is for educational institutions
Umm Al Quwain Free Trade Zone (UAQ FTZ)
Umm Al Quwain Free Trade Zone (UAQ FTZ) is situated close to the UAE’s primary seaports and within one hour’s drive of Dubai International Airport and Sharjah International Airport, ensuring easy access to the rest of the world.
UAQ FTZ has an investor-friendly environment and establishing a commercial base in the UAE has never been simpler. Company formation in UAQ FTZ is not only tax-free but implies very few costs of registration, office accommodation, and other annual expenses. This free zone provides all the facilities available in other free zones ( 100% company ownership and zero currency restrictions etc ) at a low cost. It is the reason that growth opportunities for forward-thinking SMEs and micro-businesses in particular have immense growth opportunities in UAQ FTZ.
This is the Free Zone of the future where progressive companies - regardless of the sector in which they operate - can enjoy doing business in a safe, secure, and prosperous environment.
Creative City Fujairah ( CCF )
One of the fastest growing Media Free Zones in the MENA region is Creative City Fujairah.Creative City Free Zone Authority in Fujairah specializes in Media, Events, Consulting, Education, Communication and Marketing, Music and Entertainment, Design and Technology complementing existing media clusters in the region and facilitating further creativity in these fields.
Taking advantage of lower cost of operating licences and lower cost of living, CCF is considered by the investors in the media segment as an alternative option for expansion. This free zone offers a remote business setup and visa processing.
CCF targets smaller players trying to establish new businesses or benefit from a new location for their existing operations. Creative City, having 40,000 sq. meters of dedicated land area complements existing media clusters in the region, and further facilitates creativity in all fields, for both freelancers as well as companies in a variety of specialties, such as training, media production, media services and technology.
CCF’s business license packages offer entrepreneurs and investors all what is needed to establish their business in the region. CCF is a great option for those who want to combine multiple service activities, have a large number of visas ,and open a company without a personal visit.
The Dubai South Free Zone (previously named Dubai World Central), is one of the strategic business hubs established by the Government of Dubai. Today, the Dubai South Free Zone is the largest and leading global trade, business, and aviation hub.
Dubai South is located on 140 square kilometers of the multipurpose area right next to the Jebel Ali Sea Port. The Dubai South Free Zone international airport is strategically located to provide convenient logistics and shipment around the GCC, Middle East, and the entire world. The Dubai South Free Zone serves as the strategic platform in the UAE for the growth of logistics, aviation, light industry, and ancillary service businesses.
This free zone is one of the fastest-growing zones in the Emirates and boasts of efficient trade, networking and professional platforms. Dubai South provides a complete lifestyle opportunity as business and residential areas are present side by side. This unique feature qualifies Dubai South to be a part of one of the best Free Zones in the UAE.
Sharjah Media City (SHAMS) Free Zone
Sharjah Media City (Shams) Free Zone is one of the youngest and well-known free zones in the UAE. Shams is situated in the Emirate of Sharjah located just 5 minutes from Sharjah International Airport and 15 minutes from Dubai International Airport. It was launched in January 2017 with a vision ‘to make creative entrepreneurship accessible and inspire business growth’.
This free zone is frequently compared closely with the free zones offering the cheapest company formation packages in the UAE. The service levels offered by the free zone match with the top of the line free zones in the UAE. SHAMS Free Zone Authority is well known for its budget license packages starting from AED 11,500. The company registration process can be completed remotely within a time span of 2 working days.
Sharjah Media City free zone allows the youngest age of the company shareholders you can own a business starting from the age of 19. This is a great benefit not available in any other Free Zones. Company employees can be as young as 18 years old, which is also quite unusual in comparison to other Free Zones.
Shams License Types
Shams offers more than 120 business activities and provides flexibility to the shareholders to combine different activity types on the same company license.
The types of licenses offered by Shams are:
Service and Consultancy License: it allows for production, re-production, transformation and distribution of services. Service license includes rendering services as a primary objective and utilizing goods to provide them.
Trading License: Selling goods within Shams or importing and exporting of goods. It includes movement of goods, wholesale and retail sale of goods and rendering of services related to the sale of these goods.
Industrial License: The industrial license issued by Shams allows for production, re-production, transformation and manufacturing of goods.
Advantages of Sharjah Media City
Wide range of business activities available on the same business license
All company documents issued within days
Shareholders are not required to be physically present in the UAE to incorporate a new company
0% corporate or personal income tax
Quick and simple online registration process
Deposits are not required by Shams
Allocation of up to 6 visas on a shared desk facility
SHAMS aims to be a world-class media hub for innovative facilities and services and has already gained an outstanding reputation amongst young entrepreneurs and SMEs in the UAE and across the world.
Ajman Free Zone Authority (AFZA)
Ajman Free Zone is one of the oldest and best-known free zones within the UAE. It’s situated in the Emirate of Ajman about 40 minutes drive from Dubai. Strategically situated at the entrance of the Arabian Gulf, Ajman Free Zone is well placed to serve the eastern and western trade markets. Ajman's closeness to Sharjah and Dubai gives easy accessibility to the two international airports and four ports.
AFZA welcomes any businesses: starting from freelancers, ending with light manufacturing and trading companies. As opposed to business setup anywhere else in the UAE, Ajman Free Zone company setup is attractive to those who want to start a new business from scratch due to its competitive fees for young entrepreneurs and multiple installment payment plans.
Advantages of Ajman Free Zone
Better connectivity: AFZA is well-connected globally through the waterways and airways. The Ajman port and Dubai, as well as Sharjah Airport, are in Free Zone’s proximity.
Easy to set up: Fast track license processing for company formation
Best Infrastructure: The AFZA offers Flexi desks, offices, warehouses, land, and onsite accommodation with optimum quality and best facilities.
Business-friendly laws: Repatriation of capital, as well as profit, is allowed completely and companies are fully exempted from corporate tax. The immigration policies for employees are also simplified.
Consult an expert:
Still clueless which free zone to opt for? Simply consult our expert. Get in touch with Concept Advocates & Business Consultants – the best business setup service providers in the UAE.
For more details call us on ++971 4 353 0020, +971 52 454 2020, +971 4 220 00030 or email us at email@example.com