Working in Dubai

Within a Free Zone

Free zones have their own set of rules and procedures for establishing a company, and are designed to encourage foreign investment. The rules and procedures for establishing companies differ from the rest of Dubai, particularly with regards to foreign ownership. For example, a branch or a representative office can be established in a free zone with the support of the free zone authority. Non-nationals and foreign companies may also choose to set up a free zone branch as their head office.

If you set up the company within the free zone, full private foreign ownership is permitted, albeit with significant annual fees. Both labour and immigration laws vary slightly as well in the free zones. 

Advantages
The advantages of setting up a company in a free zone include:
  • Option of having 100% foreign ownership of the business.
  • Waiver of corporate tax for 15 years; this can be renewed for another 15 years upon expiry not withstanding any subsequent change to federal or local laws.
  • Import and export tax exemptions of up to 100%.
  • Personal income tax waiver.
  • Documentation is less and is mostly in English.
  • Repatriation of capital and profits up to 100%.
  • Assistance in recruiting labour assistance in sponsorship and housing and other support services.
Legal form
Companies can operate as the following:
  • A branch in a free zone (of an existing parent company overseas).
  • A free zone establishment (FZE) with a single shareholder.
  • A free zone company (FZCO) with two or more shareholders.
  • A limited liability company (LLC); setting up an LLC can be a slightly longer process and have a minimum capital requirement which varies from free zone to free zone, but is not required for a branch company (for instance, in Jebel Ali free Zone and Dubai Airport Free Zone, minimum capital is Dhs.1 million for FZE and Dhs.500,000 for a FZC).
  • A sole proprietorship.
Trade name
The process for registering a trade name is usually taken care of by the free zone authority – and each authority has different application processes.

Free zone ID
Employees working within a free zone will either be issued a labour card or a free zone ID, valid for one to three years. The free zone authority will process all residence visas directly through the GDRFA, without having to get approval from the Ministry of Labour. This speeds up the process and visas can often be processed within hours. Once the GDRFA has stamped a residence visa, the free zone will then issue the labour card or free zone ID.

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