How profitable is it for a foreign entrepreneur to open a business in the UAE free economic zone? Let’s take a look at the cheapest free zones for business and peculiarities of conditions for foreigners.
Currently, the UAE is very popular among the CIS natives both in terms of ordinary and business immigration. If the company has not reached this income threshold, it is exempt from tax. In addition, there is an opportunity to register a company in the so-called free zone and not to pay tax even after exceeding the limit. In which of the free zones is it most profitable for a foreigner to open a business?
Determining the Cheapest Free Economic Zone
The cost of registering a business in a free zone in the UAE will depend on the direction of the business that the foreigner plans to engage in. After all, each type of activity provides a different license, which costs differently.
We show the difference in price on the example of trade license in different Free Zones:
- RAKEZ – 3100$
- Dubai Silicon Oasis – IFZA – 3250$
- Sharjah RTI Park – 1500$
- Meydan Free Zone – $3,400
- DUQE – Dubai – $680
The most popular free zone in the UAE by far is DIFC, and the most inexpensive are DUQE and DSO-IFZA.
Inexpensive Free Economic Zones in Dubai and Abu Dhabi
Dubai has long won the trust of foreign entrepreneurs as one of the most profitable and convenient in terms of infrastructure free economic zones. Hundreds of companies with 100% foreign management are registered here every year. Abu Dhabi is also famous for its cheap FEZs Kezad, Masdar City, ADAFZ. Commercial warehouses, airports, furnished offices, transportation interchanges are at the service of entrepreneurs.
In total, there are more than five dozen free economic zones in the UAE. In addition to those that were named earlier, you can highlight more:
- Ras El Khaimah Freezone (RAKEZ);
- Umm al-Quwain Free Trade Zone (UAQ FTZ);
- Ajman Media City Free Zone in the UAE.
However, before giving preference to one of the FTZs, it is recommended to carefully study the conditions for obtaining licenses in each of them, and it is better to engage professionals for this purpose.
How to Register a Company in Free Zones
Once the optimal freezone is chosen, you can proceed to the process of company registration. But beforehand the entrepreneur should decide on the size of the authorized capital (if such requirements are present in the chosen freezone), the type of activity, the name of the company, and the actual budget. After the registration of the company in the FEZ to the name is added the ending FZ.
Also, all founders of the company will need a special format visa. This authorization document will also be required for all employees of the firm. The process of incorporation of a company in the UAE in the free economic zone consists of several stages:
- It is necessary to pre-check the name for compliance with the requirements and uniqueness.
- Enter the company in the register in the appropriate authority.
- Register the legal address of the firm.
- Obtain a license.
- Rent an office.
- Become a corporate client of a local bank.
The sequence and number of items in the process may vary depending on the emirate. In any case, the decision to establish a business in a free zone in the UAE is a good move for further successful development of your business in the international format.
The UAE’s Free Economic Zones offer foreign entrepreneurs an enticing opportunity to establish and grow their businesses profitably while enjoying significant tax benefits. Dubai and Abu Dhabi, with their robust infrastructure and cost-effective options, stand out as preferred destinations for foreign investors. These zones provide essential amenities like commercial warehouses, furnished offices, and transportation hubs.