Free Zones in the UAE/Company Formation

The Free Trade Zones (FTZs) of the UAE are a veritable opportunity for the country to

showcase its development and special area approach. The UAE in the last decade has

witnessed a quantum increase in industrial development and one of the most significant

and remarkable achievements is the success of Free Zones. Free Trade Zones are

established under a special Decree passed by the Ruler of the Emirate in which the Free

Zone is created.

To date the Free Zones have been successful in attracting a large number of foreign

companies and foreign direct investment. The share of the Free Zones in non-oil

exports has increased considerably along with the net exports from the Free Zones. The

incentives offered by various Free Zones of the UAE are generally similar and include:

An independent Free Zone Authority (FZA) governs each Free Zone, and is the

agency responsible for issuing FTZ operating licenses and assisting companies with

establishing their business in the FTZ.

Investors can either register a new company in the form of a Free Zone Establishment

(FZE)/Free Zone Company (FZCO) or simply establish a branch or representative office

of their existing or parent company based within the UAE or abroad. An FZE is a limited

liability establishment, incorporated in a Free Zone, owned by one natural or judicial

person, whereas an FZCO is a limited liability company incorporated in a Free Zone by

more than one shareholder, generally up to five. FZE/FZCO are governed by the rules

and the regulations of the Free Zone in which they are established. There is a minimum

capital requirement ranging from AED 50,000 to AED 1,000,000 depending upon the

selected Free Zone.

Once a legal presence has been established in the Free Zone, the business will need to

lease premises or land and acquire a license from the FZA. Different types of licenses

are issued in different Free Zones, however companies with valid licenses only can

conduct business within the Free Zone or abroad. To sell their products in the UAE, a

UAE registered official agent is required. Services and products can be obtained from

and within the UAE without an agent.

The licenses issued by the FZA can be renewed annually as long as a lease agreement is

in force with the FTZ.

Given hereunder are the various Free Zones established in the Emirate of Dubai:

·         Jebel Ali Free Zone                                                Dubai Multi Commodities Center

·         Dubai Cars and Automotive Zone                         Jumeirah Lake Towers

·         Gold and Diamond Park                                         Dubai Flower City

·         Techno Park                                                           Dubai Airport Free Zone

·         Dubai Internet City - Tecom                                  Dubai Healthcare City

·         Dubai Media City - Tecom                                    Dubai Silicon Oasis

·         Dubai Studio City - Tecom                                    Dubai International Financial Center

·         Int’l Media Production Zone - Tecom                    International Humanitarian City

·         Knowledge Village - Tecom                                  Dubai Logistics City

·         Dubai International Academic City - Tecom         Dubai Maritime City

·         Dubai Outsource Zone – Tecom                            Dubai Textile City

·         Energy & Environment Park - Tecom                  Heavy Equipment & Trucks City

·         13. Dubai Biotechnology                                      Dubai Auto Parts City

Given hereunder are the various Free Zones established in the Emirate of Sharjah and the

Northern Emirates:-

·         Sharjah Airport Free Zone               Fujairah Media Zone / Creative City

·         Hamriyah Free Zone                        Ahmed Bin Rashid Free Zone (UAQ)

·         Ajman Free Zone                             Ras Al Khaimah Free Zone

·         Fujairah Free Zone                          Rak Media City (RAKIA)

Given hereunder are the various Free Zones established in the Emirate of Abu Dhabi:-

·         Abu Dhabi Airport Free Zone

·         Free Trade and Logistics Zone (Taweelah)

·         Two Four 54

The UAE Free Zones have been among the strong pillars of the country’s economic performance attracting much foreign investments, creating thousands of jobs, and

facilitating the needed transfer of technology into the country. Together, the Free Zones

 account for more than half of the country’s non-oil exports and underpin the UAE’s ranking as the third most important re-export centre in the world.


Winston Wambua

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