Free Zone Company Formations

The United Arab Emirates is a global hub for business and innovation, and its free zones offer a unique opportunity for entrepreneurs and investors to establish and grow their businesses in a world-class environment.

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What is a free zone?

Imagine a special place where businesses can operate with many advantages. Free zones are geographical areas which have their own, independent, business regulations that are different from the rest of the UAE. These rules and regulations are designed to make it easier for businesses to operate and succeed. Each free zone has its own free zone authority, which implements and oversees the rules. A free zone may also be called a free trade zone or a free economic zone.

What is the difference between mainland and freezone in UAE?

The main difference between free zone companies and mainland companies is where they can operate.

Free zone companies can only operate within the free zone where they are licensed and with overseas businesses. They cannot do business directly with customers outside of the free zone, unless they appoint a local agent or distributor, which acts as an intermediary between the two parties.

Mainland companies, in contrast, can operate throughout the emirate where their trade license was issued, including the free zones, and they do not need a local agent.

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What are the benefits of a free zone company in the UAE?

Here are the top 10 benefits of free zone companies in the UAE.

100% Foreign Ownership
100% Repatriation of Capital and Profits
Exemption from Corporate and Income Taxes
Exemption from Customs Duty
Independent Regulations
East access to regional and global markets
State-of-the-art, modern infrastructure
No requirements for a physical office
Choice of legal structures
Streamlined company formation processes

Are free zones sector specific in UAE?

The UAE's free zones typically focus on a specific industry and draw companies from that field, as they will be equipped with the appropriate facilities to meet their needs. They also attract ancillary companies which provide support and convenience services to the businesses and the employees in the free zone, such as coffee shops, dry cleaners, accountants, hair dressers and supermarkets.

UAE free zones cover a huge variety of sectors, including: aerospace, creative industries, education, energy, financial services, healthcare, technology, industrial, media, logistics, pharmaceuticals and more.

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What types of companies are attracted to free zones?

A wide range of companies are drawn to doing business in UAE free zones, from startups and small businesses to multinational corporations,

for a variety of reasons:

Importers & Exporters

Importers and exporters opt for free zones which are strategically located close to shipping ports, airports and the railway, for the ease of transporting their goods in and out of the country, and the exemption from customs duty.

Manufacturers

Manufacturers opt for industrial free zones which provide the suitable infrastructure and resources. These free zones are like eco-systems which help to enhance value and cost competitiveness through energy tariff incentives, funding programmes, increasing demand for locally-produced goods and customs exemption.

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Service Providers

Service providers choose free zones for the ease of doing business and the ready-made customer base of businesses setting up there.

Technology Companies

Technology companies choose free zones for reduced costs, ease of doing business and access to a skilled workforce.

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Financial Services Companies

Financial services companies opt for free zones for the enhanced credibility of operating under the regulatory framework, which is tailored to the needs of their sector, and easy access to global markets.

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Media & Entertainment Companies

Media and entertainment companies choose free zones for the facilities provided and the supportive business environment.

Educational Institutions

Educational institutions opt for free zones for reduced costs, ease of doing business, and access to global markets.

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Healthcare Providers

Healthcare providers choose free zones for the prestige, state-of-the-art facilities, incentives for doctors to setup a part-time, independent practice, and supportive business environment, e.g. promoting Dubai as a destination for medical tourism (ranked 6th globally, Medical Tourism Index 2020-2021).

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