In this article, we will talk about establishing companies in the Emirates Free Zone, as the Emirates is considered one of the best global markets for investment, and it also has many international free zones that are considered a global market for trade and investment. Therefore, establishing companies in the Emirates Free Zone, and the procedures for opening a company in Dubai in general to start investing in Dubai, are among the most important topics that concern the investor, whether local or foreign.

Reasons to invest in the UAE

As we mentioned before, the UAE and its free zones make it one of the most important countries that any investor seeks, starting to invest in Dubai, and knowing the procedures for establishing a company or opening a company in Dubai or in the free zone, and this is due to the following reasons:

1. The UAE facilitates investment activities and procedures in Dubai or in free zones, or when opening a company in Dubai or when requesting a commercial license in Dubai.

These measures include the ease of connecting electricity, the ease of collecting taxes, the ease of registering property, the ease of obtaining a commercial license in Dubai, and providing protection and security for investors.

    2. Political, social and economic stability in the UAE, as the UAE is considered one of the most politically stable countries despite the presence of many foreigners of different nationalities as well, which encourages any investor to invest in Dubai.

This is due to:

• Firstly; Upholding the values ​​of tolerance, brotherhood, peaceful coexistence with and acceptance of others, respect for others and different cultures, and moderation.
• Second: The UAE government’s interest in deepening good relations with other countries, as well as its keen interest in the citizen and always striving for his comfort and happiness.

As for social stability, it is due to the government’s keenness in the Emirates to achieve social justice among citizens, and to provide them with good services such as health, education, and housing.

As for economic stability, it is due to the government in the Emirates adopting a sustainable economic vision by developing strategic plans for after oil, through the contribution of non-oil companies or entities to the national economy by 80% of the total national economy by the year 2021.

3. Among the reasons that encourage investment in Dubai is the UAE government’s interest in infrastructure, such as establishing a road or communications network that facilitates connection between one free zone and another.

    4. The strategic location of the Emirates is one of the most important reasons that encourage investment in Dubai and opening a company in Dubai or in the free zone, as it links the East and the West.

 Procedures for establishing companies in the UAE Free Zone

The procedures for establishing companies in the UAE Free Zone differ from some free zones such as the Dubai Free Zone, or establishing a company in Sharjah in terms of fees or procedures for obtaining a commercial license.

Below we will discuss the procedures for establishing a company in the Emirates and its free zones:

• First: Determine the type of commercial activity to be practiced in the Emirates, whether it is a commercial, professional or industrial activity, and on its basis the type of license to be obtained is determined.
• Second:   There must be a partner who is Emirati national and has a limited liability company, or an authorized agent.
• Third: Test a suitable company headquarters, and obtain a lease contract for the place.
• Fourth: Test the company’s trade name, which must contain the type of company activity.
• Fifth: Preparing the company contract and having it authenticated by government agencies.
• Sixth: Obtaining approval to practice the company’s activity in Dubai.
• Seventh: Go to the competent government authority to obtain a commercial license in Dubai.

As for establishing a company in Sharjah: 

• Submitting documents related to the company’s ownership and type of activity, and requesting a license and initial work approval.
• Obtaining a license to conduct business in the region, a lease contract, and receiving the keys to the company’s headquarters and stores.
• Obtain a company ID for easy entry to the area.

Costs of establishing companies in the UAE Free Zone

The costs of establishing companies in the UAE Free Zone vary based on several factors such as the type of company, the geographical region in which it is located, and the services provided by the company responsible for the establishment. There are some key fees and costs to take into consideration when setting up a company in the UAE, including:

• Registration fees: These fees include company registration fees and the initial payment fees required to obtain the business license.
• Consulting services fees: If you use the services of consultants or specialized offices to assist in the incorporation process, there may be additional fees for these services.
• Commercial registration fees: Commercial registration fees vary depending on the type of company and the free zone in which it is located.
• Accommodation costs: If you intend to live in the UAE and run the company yourself, you may need to pay an annual residency fee.
• Office costs: If the company requires a physical office, you will have to bear the monthly or annual rental costs for the office.
• Annual license fees: These fees vary according to the type of company and business activity.
• Labor fees: If you intend to employ local or foreign employees, you will have to pay fees to the relevant government agencies.
• Tax fees: Tax fees vary depending on the type of company and annual income.

Documents required to establish companies in the UAE Free Zone

The procedures for establishing companies in the UAE Free Zone require specific documents that vary slightly depending on the type of company and the specific free zone. However, here is a general list of documents that are usually required to establish companies in the UAE free zones:

1. Registration Application Form: An official form containing the company details required for registration must be filled out.
2. Copy of founders’ ID card: A colored copy of the passport or ID card of all founders who participate in establishing the company.
3. Copy of residency: If one of the founders is a resident of the UAE, a colored copy of the residency card must be submitted.
4. Investment Agreement Form (MOA): Contains details of partners, company activities, company type, share distribution, company headquarters and other necessary information.
5. Commercial Registry (BR) Certificate: Submit a copy of the Commercial Registry Certificate if the company is already registered in another region.
6. Business License: A copy of the business license required for the company’s activity must be submitted.
7. Authorization document (if required): If there are delegates representing the founders, the free zone may require an authorization document proving their authority.
8. Partners’ declaration (if required): In some cases, the free zone may require a signed declaration from the partners to establish the company.
9. Copy of Lease Agreement: You are required to provide a copy of the lease agreement for the office you intend to use as a business address.
10. Registration fees: Registration fees vary according to the type of company and the selected free zone.

Advantages of establishing companies in the UAE Free Zone

Establishing companies in the UAE Free Zone has many advantages that make it attractive to investors, the most prominent of which are:

• 100% Foreign Ownership: Foreign investors are allowed to own 100% of their companies without the need for a local partner in free zones.
• Tax facilities: Free zones provide a favorable tax environment, where companies can operate without taxes on income and profits for a specific period, and there are tax facilities for international companies.
• Ease of administrative procedures: Free zones provide simple and quick administrative procedures for establishing and managing companies, which contributes to reducing bureaucracy and saving time and effort for investors.
• Advanced infrastructure: Free zones provide advanced infrastructure and integrated facilities that support corporate activities and facilitate production, export and import operations.
• Easy access to the global market: Free zones are located in strategic locations that facilitate international trade operations and provide easy access to regional and global markets.
• Freedom to transfer profits and investments: Companies are allowed the freedom to transfer profits and investments to and from free zones without restrictions.
• Financial and Financial Facilities: Free zones provide financial and financial facilities to companies, such as business financing, local and international banks, and financial consulting services.
• Availability of skilled labor: Free zones provide access to skilled and educated labor from all over the world, making it easier to meet companies’ human resource needs.

What is an instant license Dubai?

The Dubai instant license is a license that is valid only for the first year of the company’s activity in Dubai, after which all the papers and documents related to the company and its activity are submitted upon renewal, and this is done in just one step instead of following the previous steps for establishing companies in the Emirates, in order to facilitate the investor. Save time and effort.

Foreign companies in the Emirates and free zones

When establishing a company in Dubai for foreigners, you must know that there are activities that are permitted to be practiced in Dubai and other activities that are prohibited.

Among the activities authorized to be practiced are:

• Business management activities.
• Owning shares in companies inside and outside the UAE.
• Possibility of owning property.

Among the prohibited activities are:

• Oil, gas and mining activities.
• Aviation and media activities.

The most important tips for establishing companies in the UAE Free Zone

Here are some important tips for establishing companies in the UAE Free Zone:

1. Choosing the appropriate location: Before starting the establishment process, study the market and choose the appropriate free zone that matches the needs and goals of your company.
2. Market and competition study: Study the local market and competitors and evaluate the demand and supply for your proposed products or services.
3. Consulting specialists: Contract with professional legal and accounting consultants to help understand legal, tax and accounting regulations and requirements.
4. Determine the type of company: Choose the appropriate legal structure for your company, whether it is a sole proprietorship, joint stock company, or limited liability company.
5. Implementation of legal procedures: Follow the specific legal procedures to register and establish the company and obtain the necessary licenses in the free zone.
6. Developing an integrated business plan: developing a comprehensive business plan that includes goals, strategies, marketing and financial plans, etc., and defining clear implementation steps.
7. Communicate with local authorities: Communicate with local authorities and government organizations in the free zone to secure the necessary licenses and permits.
8. Form a professional work team: Select a qualified and professional work team to successfully implement the business plan and achieve the company’s goals.
9. Monitor performance and progress: Regularly monitor company performance, evaluate progress and adjust plans as needed.
10. Stay up to date: Follow legal, economic, technological and market competition developments, and be prepared to adapt your strategy based on constant changes.