UAE Free Zones are areas for business designated by the government in order to encourage prospective investments from all across the world. The introduction of free zones has seen major benefits for everyone! Those who aspire to start their own business setup can find opportunities in company formation within a free zone. Due to the continuous support and benefits offered by the UAE Government as well as the Free Zone Authorities, setting up a free zone company is a lucrative opportunity that investors would never miss. Here are some of the key steps that can help you set up a free zone company.
1. Select the company structure
The most important step to beginning your entrepreneurial journey in a free zone is to determine its ownership structure. Free zones have the added benefit of allowing 100% ownership to expatriates who wish to start a business- which is not available to companies outside a free zone. For investors who wish to establish a free zone company, can do so by registering the company in the form of a Free Zone Establishment (FZE) or a Free Zone Company (FZC). The primary difference between these two structures is that an FZE has one shareholder, whereas an FZC has two or more shareholders present. These forms of ownership are both under the broad classification of a Limited Liability Company (LLC), though they are governed by the laws of the free zone they reside in and not under the provisions of the UAE Commercial Companies Law (CCL).
2. Select a trade name
Naming your entity gives it an identity and is the first step to establishing your free zone company’s brand presence. Before finalizing a name for your free zone company, it’s best to check with either the Department of Economic Development (DED) or the free zone authority that governs your business setup. Enquiring about the validity of the name you chose can let you know whether the name does not comply with the protocols established with respect to trade names, or if the trade name has already been registered by another entity. Some naming conventions for trade names are as follows:
- The name must be followed by the legal form of the entity (LLC, FZE, FZC, etc.).
- The name should not violate public morals or the public order of the country.
- The name should not use the names of any governing authority, the names of the emirates, the UAE, or the names of any religion.
3. Application for a business license
This aspect of the free zone company setup process involves the primary economic activities of the venture. What products or services you plan to conduct business with is directly related to the trading license you will have to acquire. Trade licenses are particularly important due to the fact that a license is an ultimate proof your business has the legal right to function within the UAE. In terms of free zone licenses, free zones like SPC Free Zone (Sharjah Free Zone) offer a multitude of benefits ranging from over 1,500 various business licenses across multiple industries to 10-year license duration periods.
4. Select an office space
Free zones offer flexibility in terms of office space requirements. You can choose to rent or even buy the property required for you to begin your free zone company. The office specifications all depend on the type of business you will engage in, and free zones have a large variety of office suits that range both in size and availability of certain facilities.
5. Registration
The registration for free zone companies is simple and easy to comprehend. All you have to do is submit your application along with the relevant trade license, documentation, and paperwork, after which you will have to pay the registration and licensing fees. Business setup costs in free zones are not as high as they would be on the mainland. Due to perks like zero paid-up capital requirements as well as economical pricing of office spaces, the initial cost of starting a business is reduced, easing any financial strain. The process after your payment is completed is smooth sailing, with entry permits issued for non-residents and your business legally established.
Starting a free zone company doesn’t have to be daunting. Our experts here at SPC Free Zone can help you set up the business of your dreams with no hassle! Contact us at 800 SPCFZ to bring your entrepreneurial dreams to life in just a day.
