General Manager
Ravi Krishnan / Expert View
Free zones in the UAE cater to various industries, including technology, finance, healthcare, and logistics, among others. They offer businesses a range of facilities and services, including office space, warehousing facilities, and access to business support incentives that make it easier for businesses to operate and grow in the region.
UAE free zones
Free zones are special economic zones or jurisdictions offering financial and tax benefits for businesses. In all, the seven Emirates have almost 40 free zones. Free Zone Authority (FZA) refers to the government controlling a free zone. It is the official body to regulate the sector and responsible for the free zone operations and licence issuance tasks.
In a free zone in the UAE, an investor may establish one of the following two types of companies.
- Free Zone Limited Liability Company (LLC) or Free Zone Company (FZ Co.)
- Free Zone Establishment (FZE)
The top listed Free Zones in UAE:
- International Free Zone Authority (IFZA)
- Sharjah Media City Free Zone (Shams)
- Sharjah Publishing City Free Zone (SPCFZ)
- Ras Al Khaimah Economic Zone (RAKEZ)
- Jebel Ali Free Zone Authority (JAFZA)
Free zone businesses often aren’t allowed to operate on the mainland; they can only do so abroad and within their Free Zones.
Free zones catalyse economic growth for the nation by encouraging foreign direct investment (FDI). These zones are a primary point for businesses looking to work with clients throughout the UAE and GCC via regional distributors.
Benefits of establishing a business in a Freezone:
- Complete foreign ownership: Full foreign ownership is one of the most advantages of establishing a free zone company in the UAE. So, a UAE national sponsor is not required for the foreign investor’s firm to be formed. With no need for local sponsors, the foreign owner of the business owns the entire company. Whatever the investor’s nationality, foreign ownership is permitted.
- Not limited by currency: Government-imposed limitations on using foreign currencies in transactions are known as currency rules. Foreign entrepreneurs will find the transaction procedure more straightforward as there are no currency restrictions in UAE free zones.
- Exemption for import and export: UAE free zone jurisdictions are exempt from import and export taxes. It significantly reduces costs and draws import and export companies. It aids in advancing global trade and preserving diplomatic ties with many nations.
- Complete remittance of capital and profits: The businesses qualify for all repatriation advantages. The foreign individual has the legal privilege to repatriate income and profits fully.
- Recruiting workers is simple: Companies operating in free zones can efficiently and economically handle the paperwork associated with hiring new employees.
- Easy incorporation of a business: Simple steps are required to incorporate a firm in a free zone. Compared to other jurisdictions, you might complete the licence requirements in a matter of days, making the start up procedure uncomplicated.
How can Ascent Partners help?
Ascent Partners is a boutique consultancy providing bespoke, end-to-end corporate services ranging from company formation to accounting, bookkeeping, and compliance services for entrepreneurs looking to set up their next venture in the UAE. We work alongside to strategise, startup, and scale businesses in the UAE and the broader region.
With a combined experience of 50+ years, our expert consultants provide reliable and unparalleled guidance throughout all strategic phases of a business’ evolution.
Ravi Krishnan is the General Manager at Ascent Partners. Views expressed are his own and do not reflect the news portal’s policy.
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