Free Zone Company Formation
Free Zone Company Formation in Dubai
The free zones of the UAE offer several benefits to investors and entrepreneurs. Benefits include 100% foreign ownership, fewer taxes, and a business-friendly environment. So, if you intend to harness these benefits, free zone company formation in UAE is the way to go.
UAE has more than 40 free zones, with many under construction. Some specialize in particular sectors like finance, creative, technology, and many others. They have their own rules and guidelines governing business formations and operations. Entrepreneurs prefer UAE free zone company formation since they foster innovation and drive economic growth.
The company formation process in UAE free zones is an efficient process. Since they have standalone regulations, the time and effort to set up businesses is less. Also, you can always find end-to-end support for all the licensing-related administrative tasks. That is why investors find the free zones of UAE an attractive destination for setting up a business.
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Benefits of Free Zone Company Formation in UAE
Individuals and businesses from foreign countries prefer free zone company formation in the UAE because of several benefits. These benefits include the following:
- There are no restrictions on foreign ownership. So, foreign investors can own 100% of their company. Also, you do not need to find a local sponsor.
- An independent Free Zone Authority governs the businesses in that free zone. So, you have no obligation to follow the Commercial Companies Law of mainland UAE.
- You can find a wide range of commercial sectors in which to establish your business. Moreover, free zones dedicated to a few sectors make your work easier.
- Free zones enjoy modern infrastructure, advanced logistics, and a well-developed communications system. In these free zones, you can find a good network of businesses from all over the world, improving your global connectivity.
- The legal and regulatory environment is somewhat stress-free in the UAE’s free zones. There are a few restrictions to abide by. Also, several support services in these free zones make operations hassle-free.
- No currency restrictions and full repatriation of capital and profits are the attractive points of free zones in the UAE.
- You can have office space to make a physical presence in the country. Also, you can have more visas without the local sponsorship requirements like with the employment visa.
- The business setup process in free zones is simple, quick, and hassle-free. That is a big attraction point for some investors.
- Tax exemptions exist in a few sectors. Some taxes are also applicable at lower rates, saving you money.
- The free zones of the UAE have ready-made land plots, warehouses, offices, and factory units. You just have to make the effort of selection.
- Privacy protection is a significant benefit of free zone company formation in the UAE. No public records of company shareholding and ownership are available.
UAE Free Zone Company Formation Features and Requirements
Besides these benefits, some unique features of free zone companies in the UAE exist. Also, some prerequisites that company formation in UAE free zones must fulfil. These include:
Types of Company
You can establish either:
- A Free Zone Establishment (FZE), which has only one shareholder
- A Free Zone Company (FZVC), which has two or more shareholders; individuals and corporates are allowed as shareholders
- A branch or a representative office of a local or foreign company based in UAE or abroad
Business License Options
You have the following options for business licenses:
- Manufacturing
- Trading
- E-commerce
- Industrial
- Consultancy
- Warehousing
- Educational
- Media
- Freelancer
- Creative arts
- And many more
Permissions
In addition to the free zone authority’s approval, you will need permissions from other authorities in specific business sectors. These authorities can be Ministries, organizations, or Municipalities. This is true for a few free zones and specific business activities.
Need For a Manager
A free zone company must appoint a manager who is a UAE resident or planning to take up UAE residency. The manager will handle daily operations, contract signing, bank account operations, and authorization of company structural changes.
Tax Residency Certificate
A free zone company can apply for a tax residency certificate in the UAE. This certificate allows you to benefit from the double tax treaty network.
Costing
The cost for Dubai free zone company formation depends on the free zone where you decide to do business. The size of the office space, your business needs, sector, and visa requirements also contribute to the cost.
Business Range
You can conduct business inside the free zone and also internationally. But you cannot carry out business in the mainland UAE.
Documentation or Dubai Free Zone Company Formation
You will need to submit the following documents to facilitate UAE free zone company formation:
- Copies of passports of all shareholders
- Copies of UAE entry permits or visas or Emirates ID of all shareholders, if applicable
- CVs
- Passport-sized photos
- Reference letter from a bank
- Address proof like utility bills
- Completed application form
In the case of corporate shareholders, you also need to submit the following documents:
- Detailed business plan (in some free zones)
- Trade license copy
- List of UBOs
- Memorandum of Association
- Board of resolution for company setup
- Name of the authorized signatory
Procedure for free zone company formation in UAE
In the case of corporate shareholders, you also need to submit the following documents:
- Detailed business plan (in some free zones)
- Trade license copy
- List of UBOs
- Memorandum of Association
- Board of resolution for company setup
- Name of the authorized signatory
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