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How to Obtain a Freezone License in the UAE: A Step-by-Step Guide
The United Arab Emirates (UAE) is a hub of economic activity in the Middle East, attracting businesses worldwide to establish a presence there. One of the most attractive options for businesses is to set up a free zone, which offers a range of benefits, including tax exemptions, 100% foreign ownership, and streamlined business processes. In this guide, we will discuss how you can obtain a free zone license in the UAE and explore the associated costs.
What is a Freezone licence?
A free zone licence is a permit issued by a free zone authority that allows a company to operate within a designated area, known as a free zone. Freezones are areas where businesses can work with minimal restrictions, including 100% foreign ownership, no corporate taxes, and streamlined bureaucratic processes. Freezones attract foreign investors as they offer many benefits unavailable in other areas of the country.
Types of Freezone licence
There are several types of free zone licences available in the UAE, depending on the type of business activity you wish to undertake. The most common types of free zone licences are:
Trading licence:
This type of licence is required for companies buying and selling goods.
Service licence:
This licence is required for companies providing services such as consulting, IT, or marketing.
Industrial licence:
This licence is required for companies involved in manufacturing, processing, and other industrial activities.
Steps to obtain a freezone licence
1. Choose a free zone
The first step in obtaining a freezone licence is to choose the right free site for your business. There are over 45 freezones in the UAE, each with its own set of rules and regulations. Some of the most popular freezones in the UAE include Dubai Multi Commodities Centre (DMCC), Dubai Silicon Oasis (DSO), and Jebel Ali Free Zone (JAFZA).
2. Determine the licence type
Once you have chosen a free zone, you need to determine the type of licence you require based on the business activity you wish to undertake.
3. Select a company name
You will need to select a unique company name that is not already registered in the UAE.
4. Apply for a free zone licence
Once you have completed all the above steps, you can apply for a free zone licence. You must submit the required documents, including your business plan, company registration documents, and passport copies of shareholders.
5. Obtain approvals
After submitting your application, you must obtain licences from the relevant authorities, including the free zone authority, the Department of Economic Development (DED), and the Ministry of Economy (MOE).
6. Obtain a visa
Once your free zone licence has been approved, you can apply for a visa to live and work in the UAE. This process can take up to two weeks
Dubai free zone licence cost
Dubai free zone license cost can vary depending on several factors, including the type of license you require and the free zone you choose. Here are some of the typical costs associated with obtaining a free zone license in Dubai:
Trade license fees: The fees for a trade license can range from AED 7,000 to AED 30,000 per year, depending on the free zone.
Visa fees: The cost of a visa ranges from AED 1,500 to AED 3,000 per person.
Office rent: You will need to rent an office space within the free zone, which can cost anywhere from AED 15,000 to AED 60,000 per year, depending on the location and size of the office.
Other costs: There are additional costs associated with setting up a company in a free zone, such as legal fees, registration fees, and insurance fees.
It is important to note that the above costs are just estimates, and the actual cost of obtaining a free zone license can vary depending on various factors. However, by doing thorough research and planning, you can estimate the costs associated with obtaining a free zone license in Dubai and create a budget accordingly.
Conclusion
In conclusion, setting up a business in a free zone in the UAE can be an attractive option for foreign investors. It offers many benefits, including 100% foreign ownership, tax exemptions, and streamlined business processes. To obtain a free zone licence, you need to choose the right free zone, determine the type of licence required, select a unique company name, and submit the required documents. Once approved, you can apply for a visa to live and work in the UAE. Although the cost of obtaining a free zone licence in Dubai varies, it is important to consider all associated costs, including trade licence fees, visa fees, office rent, and other expenses. With proper planning and research, obtaining a free zone licence in the UAE can be a straightforward process and can help your business flourish in the Middle East.
