Business Setup in Dubai Free Zone

Dubai Free Zones offer various business setup options to accommodate different entrepreneurial needs.

Legal Entity Options

Free Zone Limited Liability Company (FZ LLC)

A Free Zone Limited Liability Company (FZ LLC) allows multiple shareholders with limited liability. FZ LLC protects personal assets from business debts. It suits partners launching a tech firm, for example. This structure offers 100% foreign ownership and flexible share distribution, ensuring control among 2 to 50 investors.

Free Zone Establishment (FZE)

Free Zone Establishment (FZE) provides a single shareholder structure. FZE fits solo entrepreneurs starting a consultancy. It ensures full ownership and liability limited to business assets. FZE simplifies management with one decision-maker. This option, common in zones like IFZA, supports quick setup and tax-free operations.

Branch of Foreign Company

A Branch of Foreign Company operates as an extension of an existing foreign business. It suits firms expanding into Dubai, like a UK retailer opening in JAFZA. The branch retains 100% foreign ownership and follows the parent company’s goals. Liability ties to the parent, offering seamless global integration.

License Categories

Commercial License – Trading, import/export, retail activities

A Commercial License covers trading, import/export, and retail activities. It suits businesses dealing in goods, like electronics importers in JAFZA. This license allows buying, selling, and distributing products locally and globally. Companies enjoy tax exemptions and streamlined customs processes, boosting trade efficiency.

Service License

A Service License includes consulting, management, and professional services. It fits firms offering expertise, such as marketing agencies in DMCC. This license supports activities without physical goods. Service providers benefit from 100% ownership and quick setup, ideal for professionals targeting Dubai’s growing market.

Industrial License – Manufacturing and production activities

An Industrial License governs manufacturing and production activities. It serves factories producing items like textiles in DAFZA. This license enables raw material imports and finished goods exports tax-free. Industrial businesses leverage Dubai’s logistics hubs, ensuring cost-effective operations and global reach.

Freelance/Entrepreneur Permit

A Freelance/Entrepreneur Permit supports individual professional services. It caters to solo experts, like graphic designers in IFZA. Freelance permit offers low-cost setup and full ownership. Freelancers gain residency visas and flexibility, making it perfect for independent professionals serving clients locally or remotely.

Establishing your business in a Dubai Free Zone involves several straightforward steps.

Select Your Business Activity

The first step in setting up a business in a Dubai Free Zone is identifying your business activity. Free zones cater to specific industries like media, technology, trading, or logistics. Research the activities permitted in your target free zone, as each has unique offerings. For example, Dubai Media City supports media-related ventures, while Jebel Ali Free Zone suits trading and manufacturing. Ensure your chosen activity aligns with your business goals and complies with free zone regulations to avoid delays later.

Choose Your Free Zone

Dubai has over 20 free zones, each with distinct advantages like tax benefits, full ownership, and proximity to ports or airports. Select a free zone based on your business type, budget, and infrastructure needs. For instance, Dubai Internet City is ideal for tech startups, while Dubai Healthcare City suits medical businesses. Compare licensing costs, facilities, and visa quotas before deciding. Contact the free zone authority for detailed insights into their offerings.

Select Company Name

Choose a unique and compliant company name adhering to free zone naming guidelines. Avoid offensive terms, religious references, or names resembling existing entities. Most free zones require you to submit 3-5 name options for approval. For example, in Dubai Multi Commodities Centre (DMCC), names must reflect your business activity. Check availability through the free zone’s online portal and secure approval to proceed smoothly.

Submit Application Documents

Prepare and submit essential documents to the free zone authority. These typically include a completed application form, passport copies of shareholders, a business plan, and proof of address. Some free zones may request additional documents like a No Objection Certificate (NOC) or financial statements. Ensure all paperwork is accurate and meets specific requirements to avoid rejection. Digital submission is often available for convenience.

Receive Initial Approval

Once your documents are reviewed, the free zone authority issues an initial approval. This confirms your business activity and name are accepted, allowing you to proceed. The process usually takes a few days to a week, depending on the free zone. For instance, Dubai South offers fast-track approvals for logistics firms. Address any feedback from the authority promptly to maintain momentum.

Pay Registration Fees

After initial approval, pay the required registration and licensing fees. Costs vary by free zone and business type, ranging from AED 10,000 to AED 50,000 annually. For example, licensing in Dubai Airport Free Zone may cost more due to its premium location. Payments can often be made online or at the free zone office. Retain receipts as proof for the next steps.

Receive License & Registration

Upon payment clearance, you’ll receive your business license and company registration certificate. Licenses come in types like commercial, industrial, or professional, depending on your activity. This step finalizes your legal setup, typically within 1-3 days. For instance, in Dubai Design District (D3), creative businesses get tailored licenses. Keep these documents safe as they’re essential for banking and visas.

Open a Corporate Bank Account

With your license in hand, open a corporate bank account in the UAE. Free zone businesses can choose from local banks like Emirates NBD or international ones like HSBC. Submit your license, registration certificate, and shareholder passports. Some banks offer free zone-specific packages with low fees. This account will handle transactions, payroll, and visa deposits efficiently.

Apply for Visas

Apply for employee and residency visas through your free zone authority. The number of visas depends on your license and office space. e.g., a flexi-desk might offer 1-3 visas. Submit passport copies, photos, and fees (around AED 3,000-5,000 per visa). Processing takes 5-10 days. Approved visas grant 2-3 years of residency, renewable as needed.

The cost to set up a business in a Dubai Free Zone ranges from AED 10,000 to AED 50,000. The total cost includes licensing, registration, and visa fees. Costs vary by free zone and business type. For example, Dubai Multi Commodities Centre (DMCC) charges around AED 20,000 for a trading license, while Dubai Internet City offers tech licenses starting at AED 15,000. Additional expenses include office space, flexi-desks cost AED 5,000 annually, and visas cost AED 3,000-5,000 each. Bank account setup is free with some banks like Emirates NBD. Research your free zone’s fee structure, as prices reflect location and facilities. Save costs by choosing a package deal with InZone.

The documentation and requirements needed for business setup in a Dubai Free Zone include a completed application form, passport copies, and a business plan. Submit these to the chosen free zone authority. Passport copies are required for all shareholders. A business plan outlines your activities and goals. Additional documents include proof of address and a No Objection Certificate (NOC), if applicable. Some free zones, like Jebel Ali Free Zone (JAFZA), may request financial statements. Ensure accuracy in all paperwork. Digital submission is available in most free zones. Contact the authority for specific needs, as requirements vary slightly.