What do you know about Dubai free zone?
Dubai free zone is purposefully established economic zones that allow entrepreneurs to do tax-free business with zero customs duty. A special framework of rules and regulations is implemented to control and manage the commercial activities in these economic zones.
Having been world renowned as an oil-rich nation, United Arab Emirates has rapidly diversified its image after constructing an ultra-modern architecture, breathtaking entertainment and leisure spots. Furthermore, its geographical location at the crossroads of three major continents Europe, Africa and Far East Asia, tax-free lifestyle, availability of finances and state of the art business facilities have made it an alluring place to visit and work. With an aim to facilitate a maximum number of commercial investors and businessmen, UAE government has established multiple economic zones across all major emirates of UAE including, Dubai, Abu Dhabi, Ajman, Sharjah, Ras Al Khaimah and Fujairah.
Company formation procedure
The procedure is more or less same for all free zones in UAE with few variations. Here I am discussing the general process of setting up a company in Dubai Free Zone (all FZs in the city). In other words, there is no individual zone with the name of Dubai Free Zone existing in the city. Although foreigners are allowed to launch their venture anywhere across the city, the economic zones allow them to not only enjoy 100% ownership of their setup but also offer a number of benefits like duty-free import and export and proximity with ports and airbase.
General steps of company formation
Before you start communicating with the authorities to allocate space to initiate your setup conduct a thorough market research and evaluate your requirements to spot out the best site for your company. After conducting these initial steps, next step is to verify the license type, commercial activities, legal structure of the company and facilities available for entrepreneurs. Before you submit an application form also validate about the charges and fee, agreements and other legal documents and signing authorities. Irrespective of the kind of your venture, you have to execute these requirements to receive a license to gain legal rights to operate an enterprise.
Below I am briefly describing these steps of company formation to give you a clear idea about the process of company formation in economic zones.
Understand the license type
In order to cater the diversified needs of different entrepreneurs, FZ authorities provide a wide range of licenses that include trading, general trading and consultancy/service provider, industrial and commercial licenses.
Confirm activities allowed
As these economic zones are meticulously constructed to support all kinds of trading activities, always confirm the specific kind of activities a zone allowed. Also, ask if there are any restrictions to practice specific activities.
Finalize the legal structure of the company
Legal structure totally depends on the number and nature of the partners included in the contract. Every legal framework is different from each other and requires a different set of legal documentation at different charges. For example, legal documents required for corporate partners would be different from individual shareholders.
Having been a free zone, it is not necessary that all of them offer all types of business facilities from office space, warehouse and manufacturing units. Estimate your needs first to pick the best zone offering the right facilities.
Validate charges and fees
This is critically important when it comes to setting up FZ Company in Dubai, UAE. Most of the investors try to avail the cheapest option to register their company. If you are looking for the reasonable prices, it is necessary to understand and include the hidden charges and extra fees, while calculating the final charges.
Summary: Consider following these strategic steps and choose free zones to establish your setup. If you want to reduce total operational with tax-free business and duty-free import and export of goods.