Dubai Free Zone Company Formation Procedure

Thursday, 8 October 2015

Dubai free zone company formation procedure varies from free zone to the free zone. If you are reading this article, the chances are that you are planning to set up a business in Dubai and would like to know more about Dubai Free Zone company formation procedure. In this article, we will try to describe the general procedure for Dubai Free Zone company formation. Though we mention Dubai Free Zone for the ease of understanding, please note the following;

  • The term Dubai Free Zone is used to represent all the Free Zones in Dubai.
  • There is no individual entity called the Dubai Free Zone
  • Free Zones in UAE, in general, follow similar procedures for company formation, with some differences between the Free Zones.

General Preparation for Dubai Free Zone Company Formation Procedure.


As for when of any start-up business, we assume that you have done your preparations well before proceeding with Dubai Free Zone company formation procedure. Essential steps of your preparation for Dubai Free Zone company formation should include the following.

  • Market Research.
  • Confirm your business requirements.
  • Identifying the best site that meets your business requirements.Dubai Free Zone Company Formation Procedure
  • Evaluating the various Free Zones in UAE.
  • The business plan for your new venture etc.

Each Free Trade Zone has its own rules, regulations, and procedure. Dubai Free Zone company formation procedure varies between Free Zones. In general, the procedure to set up a Free Trade Zone company in UAE can be summarized in the following steps.

Dubai Free Zone Company Formation Procedure


1.     Determine the free zone license type.
2.     Confirm the activities.
3.     The legal structure of the company.
4.     Confirm the business facilities required.
5.     Verify the fees and other charges.
6.     Submit the application form and other documents.
7.     Secure the preliminary approvals.
8.     Payment of the fees.
9.     Sign the agreements and other legal documents.
10. Receive your business license and other certificates or documents.

1. Determine the Free Zone license type.


The very first step in Dubai free zone company formation procedure is to decide the license type that allows your business activity. In general, Free Zones offer the following types of business license;

1.      Free Zone Trading License.

2.      Free Zone General Trading License.

3.      Free Zone Consultancy / Service License.

4.      Free Zone Industrial License.

5.      Free Zone Commercial License.


2. Confirm the business activities.


Not all Free Zones allow all activities. Some Free Zones specializes in certain activities. So it is important that you confirm that your intended activities are permitted by the Free Zone of your choice. Moreover, there are restrictions over the number activities allowed.

3. Determine the legal structure of the company.


The legal structure of the company varies according to the number and nature of the partners involved. Documentation required, costs, etc. also change depending on the legal structure of the company. Documents required for a corporate partner (or a branch entity) would be different from those required for an individual shareholder.

4. Confirm the business facilities.


Do not assume that all Free Zones offer all types of business facilities. Though most of the Free Zones in UAE offer office space, warehouse, etc. availability can be a limiting factor. So you need to assess the availability of the essential facilities provided by the Free Zone before committing to set up the business with them.

5. Verify the fees and other charges.


This is the most important step in Free Zone Company Formation in Dubai procedure. Many investors who wish to register their company in one of the Free Zones in UAE go for the cheapest option available based on the obvious costs. They do not understand the hidden charges and extra fees to be paid for the services that are essential for the survival of their businesses. The total cost of your Free Zone business can be categorized into two.

  • The first-year cost for Dubai Free Zone company formation
  • Yearly renewal costs

Some Free Zones offer packages that are cheaper than the normal company formation costs. Investors fall prey to these packages offered by certain Free Zones and business consultants without realizing that they have to pay the package charges every year. The normal yearly renewal charges could be cheaper than the cost of the packages. Moreover, most of these packages include only a business license and not office space. This may not be very useful if you are serious about your business and investment. On the positive side, your efforts to decide the real cost of free zone company formation is very limited in the case of company formation packages.

6. Submit the application form and other documents to the Free Zone.


The application form and other legal documents are necessary to start the real application procedure. Depending on the nature of the business (branch /subsidiary, establishment /partnership, trading /industrial /services), the documents required may vary. In general, you would need the following documents.
  • Free Zone application form.
  • Passport copy.
  • Visa copy (if you have an existing UAE visa).
  • Business plan.
  • Bank statements (to prove the capital amount).
  • No objection certificate from the current sponsor (for UAE residents).


7. Secure the preliminary approvals.


Currently, some Free Zones in UAE may demand prior approvals from other regulatory departments to start the free zone company formation process. These approvals could be from.

  • Immigration Department: Some Free Zones process this request for the clients; some require the client to process it by themselves where some Free Zones do not need this approval at all. Though it helps to make sure that your visa application would not face any major issues after the company formation, it would delay the entire process by a few weeks.
  • Environment Department: For certain activities, especially industrial activities, clearance certificate from the Environment Department is necessary.
  • Ministries of Health: Some Free Zones demand a certificate from the Department of Health to carry out activities related to pharmaceuticals, food products etc.


8. Payment.


Now you are ready to make the payments. With some Free Zones, you have the option of making the payments in installments, however, pay attention to the total cost in this case could be higher than the normal charges with a minimum of 10% and up to 50%.


9. Sign the agreements and other legal documents.


After you make the payments, the concerned Free Zone authority would prepare the relevant legal documents and you would be asked to sign them in the presence of an executive/official of the Free Zone.

10. Receive your Free Zone Business License and other documents.


Here you are! It is time to receive your Free Zone Business License. Along with the business license, some Free Zones give associated documents such as share certificates, certificate of incorporation, etc. Deciding on the best free trade zone in UAE for your business requirements depends on many factors. So it is important that you spend quality time on evaluating the options available for your business requirements. For certain business activities, it would be ideal to form a business outside the Free Trade Zone (mainland / local business).

If you can start the business, then Jitendra Consulting Group is the one of the best company in Dubai Free Zone Company Formation.this company is 10 years old company and Our Expert team has vast experience in Free Zone Company Formation in Dubai, we  make your process easy and hassle free.

4 comments:

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