Setting Up a Business in UAE Free Zone

Company Formation in UAE is certainly less cumbersome and complicated than setting up a business anywhere else in the world. There are fewer red tapes and government intervention is very minimal. To draw more foreign investments to their country, UAE government has even set up ‘Free Zones’ all across the City of Dubai and so far, the idea of setting up a business in UAE free zone has proved to be a grand success.

It has proven to be a masterstroke as foreign investors are lining up to set up their businesses in the free zones as they offer a wide range of benefits for example –

  • Foreign investors can retain 100% of the ownership of the company.
  • Investors will not have to pay any personal or corporation tax whatsoever.
  • Investors can repatriate any amount of capital or profits generated by their business. There is no upper limit for that.
  • 100% tax exemption on all imports and exports.

So, it is no wonder that investors from around the world are making a beeline for freezone company setup You might find it hard to believe but these free zones are contributing as much as one third of UAE’s total revenues from non-oil related trade.

Business Setup in Dubai free zone is easy but there are certain rules and regulations that you need to follow. Here we are going to discuss those rules in detail so that you don’t have to face any inconvenience while trying to set up a business in Dubai.

Setting Up a Business in UAE Free Zone


Since this is the very first stage of business Setup in Dubai free zone, you need to be a bit careful. Choose the business activity that your business is planning to get involved in because once you have selected a ‘business activity’, your business might be barred from getting involved in other types of business activities in Dubai.

For example, if you choose ‘trading’ as your primary business activity, your business might not be able to get involved in professional services. Thankfully, the authority managing Dubai Free Zones is a bit lenient when it comes to a business license.

In most cases, you will be allowed to run multiple businesses with a single license but this may not be the case with all licenses and therefore, it makes sense that you should read all the documents provided by the authority carefully as you most certainly don’t want to get involved in any legal complications.


Dubai has many free zones spread across the city. The Dubai governing body has set up several sector-specific free zones like – outsourcing, finance, manufacturing, healthcare, media, maritime and many more.

So, that means if you are planning to set up an outsourcing company in Dubai free zone, you should select a zone that is set up specifically for outsourcing i.e. – Dubai Outsourcing City. Some other industry-specific free zones are – Dubai Maritime City Authority, Dubai Science Park, etc.


Selecting a name for your business may sound easy but it always turns out to be a complicated affair. It is not just a name; it will carry the brand image of your organization as well.

This is the reason why you need to spend some time to come up with a name that will resonate well with your targeted audience. But there are some other factors that you need to be careful of like –is the domain name available for that name?

Is anyone else using it already? Has it been registered by any other business organization? Does it sound offensive to a certain group of people [you need to be careful as Dubai is a multicultural society]?


Once you have chosen the name of your company, the next stage is to submit company formation application to Dubai free zone authority. Depending on the nature of your business, you might have to submit the following documents for free zone company formation to a bank –

  • Application form
  • Business Plan
  • Memorandum and articles of association
  • Color copy of all the shareholders’ passports and visas
  • Board Resolution

In case, you don’t have your visa ready at this point, you can also apply for one at this stage.


The last stage of setting up a business in UAE free zone is opening a corporate bank account. You need to submit the following documents to open a corporate bank account –

  • Copy of the company’s memorandum and articles of association
  • Xerox copies of all the passports of all the partners of the company
  • Copy of the share certificates of your company
  • Resolution from the board of directors sanctioning the opening of the corporate bank account. Corporate account opening form.
  • Copy of the company’s incorporation certificate

However, you need to keep in mind that different banks have different eligibility criteria. For example, some banks might ask for a minimum cash balance of AED 5,000 whereas some banks require all the shareholders of the company to have UAE residency visa. So, these are some steps that you need to take care of if you want to set up a company in a Dubai Free Zone.