1. Overview of Business
a) A freezone company can only conduct business inside is specific freezone or outside of the UAE. It cannot provide its services or sell its products in any UAE mainland UAE jurisdiction.
b) The restriction of local business through a distributor is mainly to differentiate the business in the local market by mainland companies and freezone entities used for import/export. A distributor that has a Mainland license can act as your local agent and charge a certain fee which is lower than the 5% duty applicable on freezone invoices, if they trade directly into the local market. In case the company chooses to use a distributor, the goods should be shipped in through the distributor itself, if not, a 5% duty fee is applicable for any goods exiting the freezone.
C) Marketing a freezone company can also be restricted as you are legally only allowed to market your company inside the freezone, may that be face-to-face or even handing someone a business card.
2. Ownership Structure
Compared to the Mainland, a freezone license is 100% owned by the expatriate. There is no need for UAE National partner/service agent. Note that mainland laws have changed recently to allow 100% ownership with a wide variety of activities.
3. Office Space
Unlike the mainland, a freezone license can be incorporated with or without a physical office. Freezone Authorities allows the license holders to use a smart/flexi office usage but this restricts you on visa allocation usage.
4. Visas Eligibility
Freezone companies are limited to a certain number of visas and this normally varies from 1-6 visa packages. If you require more than the allotted allocation, then you may be asked to rent physical space inside that freezone, this can be costly due to the limited supply but high demand of commercial space.
5. Governing body approvals
The main purpose of having a freezone establishment is for importing and exporting goods and freezone authorities usually do not need approvals from external authorities. However, any external approvals from governing bodies outside of your freezone, will not be entertained.
How can we help?
PRO Partner Group is a professional business consultancy firm with a singular goal – to help entrepreneurs, venture capitalists, and companies find their footing in the competitive Dubai market. As a full-service company, our expertise includes providing a comprehensive range of solutions aimed at speeding up business setup in Dubai free zones.
We have a team of free zone company formation experts who can offer step-by-step assistance to clients, resulting in an easy, quick, and hassle-free setup. Our specialists are happy to take over the entire company setup process, from start to finish, so you can focus on what matters the most – business strategy and growth.
Our range of solutions includes but is not limited to the following:
Strategic business planning – our team can help you identify the most viable free zone in the UAE for your business
Document processing – we can assist you in acquiring, preparing, and completing all the necessary application forms and documents
Trade name application – When applying for your chosen trade name, we can liaise with local government authorities on your behalf
Business structuring – we can provide insight into how to structure your business in compliance with local regulations
Licence acquisition – our specialists can help you to acquire the right licence for your chosen venture
Visa application and processing – our team can assist you in obtaining the right visas for the people joining your company, so you don’t have to deal with the paperwork
Opening bank accounts – we can help you open a corporate bank account with your chosen banking services provider in Dubai
Ongoing PRO Service and Support – following incorporation of your business we can then assist you to obtain investor visas, staff, and family visas and support the company with licence updates, government liaison and company secretarial service.