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Setting up Offshore Business in Dubai, UAE

March 10, 2023 | Admin | Blog

UAE is considered a magnet for entrepreneurs around the world. As the UAE continues to make massive strides in strengthening its economy and becoming one of the most sought-after business destinations in the world, the country is seeing a formidable influx of entrepreneurs and business owners trying to diversify their assets or business. Dubai and Abu Dhabi are at the epicenter of the development and boasts smart infrastructure, ease of doing business, business-friendly government policies, stable leadership and economy, and above all its strategic location as a gateway to the rest of the world.

There is no doubt that government policies support the growth of small and medium enterprises and Dubai offers a plethora of investment opportunities to the international business community, especially investors from India. Dubai is, in fact, keen on attracting innovative minds from India as it is repositioning itself as a knowledge-based economy anchored on emerging technologies.

Towards this end, the UAE Government recently went one step further allowing 100% ownership for overseas investors. In this congenial climate, it is only worthwhile to explore the diverse business landscapes the UAE has to offer.

Setting up Business in the UAE  

Foreign investors can carry out any business activity in the UAE only after being registered and licensed by the relevant authorities in the UAE. In general, a foreign investor can establish a suitable business presence in either the UAE mainland (also commonly known as “onshore”) or a business presence “offshore”. An “offshore” business presence typically refers to a registration in one of UAE’s free trade zones.

Mainland Setup

A mainland company is an onshore company licensed by the Department of Economic Development (DED) of the related emirate which is allowed to do business in the local market as well as outside UAE without any restriction. When it comes to company formation in Dubai, Mainland is the most popular and pragmatic choice as it has the maximum benefits that the country has to offer in setting up businesses, the latest one being 100% ownership of Mainland company in several sectors.

Setup a Mainland Company in 12 easy steps

1. Choose a Business Activity: Nature of your business will determine the kind of license. There typically four types of business licenses in Dubai:

  • Commercial License for general trading business
  • Professional license for service rendering business
  • Industrial license for manufacturing goods
  • Tourism license for travel and tours sector

The Department of Economic Development is the license-issuing authority and regulates all the legal activities about establishing a business in Dubai.

2. Choose a Business Structure: Dubai offers various kinds of business structures for entrepreneurs to choose from. Depending upon the nature of your business and its location, select a structure. There are certain rules regarding the make-up of one’s firm. For instance, if one plans on starting a legal consultancy firm, this can be done only as a branch of the company or as a standalone company. Types of business structures offered in Dubai are:

  • Sole Proprietorship
  • Joint Venture
  • Public Shareholding Company
  • Private Shareholding Company
  • Limited Liability Company
  • General Partnership
  • Partnership en Commendam
  • Professional Company

3. Register the Company’s Name with DED: A business name that does match any other company’s in Dubai; the name will not be accepted if it does. After the name is approved register it with DED. It usually takes 3 days to register it and is valid for a period of 6 months.

4. Approval of the Business Activity: There are a few commercial activities that are not permissible according to the DED law. According to Law No. 13 of 2011, DED is the accountable body to decide, regulate, classify, permit and license all economic activities. However, this is not applied to free zones and offshore business setups.

5. Get an Office Space: The tenancy agreement, Real Estate Regulation Authority (RERA) documents, and EJARI need to be submitted, following which the initial approval is granted by the DED. Creative Zone offers innovative co-working office spaces for its clients at a nominal cost.

6. Get an Initial Approval from the DED: This is an initial consent given by DED to register the company. It can be acquired by filling an application form and attaching the supporting documents and submitting them to the authority. You can start your business at this stage and continue with the process of acquiring your trade license.

7. Prepare a Memorandum of Association (MOA) and Article of Association: These are significant documents that should be error-free and drafted carefully. The MOA specifies the share of limitations and liberty every partner has within the company, while the Article of Association or LSA describes the role of the agent and fulfils the compliance that will be performed. MOA/LSA are the legal documents and should be drafted with the help of a legal advisor. They also need to be translated in Arabic.

8. Register your Business: This is one of the final steps in setting up your business. Fill the application form of registration. Once it is duly filled and the required documents attached, submit it to DED for approval. Notification of approval/disproval comes within a week.

9. Apply for Business license: Once the registration is done, the business license will be processed and are provided mainly depending on the nature of the business activity and the jurisdiction of the business. It takes around one week or more to get the trade license from the time you receive your initial approval.

10. Pay fees and Collect the License: A payment voucher will be provided by DED once you fill the license form and send the documents. The final payment needs to be made to collect the business trade license. Once you collect your trade license, you become a full-fledged business entity.

Benefits of Mainland Dubai license

  1. Central Presence in the UAE Market: Access and freedom to trade within and outside the UAE. An advantage available only to companies located in the Mainland, opening plenty of opportunities
  2. Conducive Business Environment: Trade centres, high-tech infrastructure and a cohesive communication network. The Mainland region has the best infrastructure to support your budding and an already thriving business.
  3. Tax Incentives– Corporate Tax remains the no 1 puller of entrepreneurs and investors in choosing UAE as their playground.
  4. Avoidance of Double Taxation: UAE provides the flexibility to business owners to enter into double taxation agreement for import-export processes, which allows them to wipe out the tax to be paid on both the sides.
  5. Easy Business Setup Process: When it comes to business setup process, Dubai Mainland provides an easy way to initiate and complete the process. Business owners prefer to engage with professional business consultants regarding the same that helps to complete the task done at a faster pace

Free Zone Setup

A free trade zone is a geographical area within the UAE that has been established by the UAE government to generally encourage direct foreign investment into the UAE and, as such, there are generally no foreign ownership restrictions, unlike “onshore” entities. That is, foreign investors can set up 100% fully-owned entities in the free trade zones. However, entities registered in the free trade zone are not permitted to conduct commercial activities in the UAE, outside of the free trade zone.

Setup a Free Zone Company in 7 easy Steps

The following steps will give you a fair idea about the process of business setup in UAE’s Free Zone.

1. Select a Free Zone Based on the Business Activity: The UAE has more than 45 Free Zones dedicated to specific business activities. From aviation, media and marketing, E-commerce, IT consultancy to finance, education, manufacturing and tourism the list is exhaustive. Business owners should first finalize the business activity and carefully choose the correct jurisdiction.

2Select a Company Structure: Once you have decided the zone, the next step is to select the appropriate business structure. Whether it will be a:

  • Free zone company (FZC)
  • Free zone establishment (FZE) or
  • Branch of a business concern

Dubai Free Zones provides numerous business entity options to business owners to select one, based on the capital to be invested and the available number of shareholders.

3. Get a Business Expert: The ease of doing business in the UAE is unparalleled. However, the process is multilayered and can get complex, which is why business owners prefer to deal with company formation specialists as they guide you at every step of the way and can help you take prudent decisions in the pre-launch and launch stage.

4. Get the Documents Ready: Drafting the company documents can be a complicated task. While incorporating your business in the Dubai Free Zone, you will have to draft documents like Memorandum and Articles of Association. These documents explain the various activities that will be carried out in the internal and external surrounding of an organization.

5. Gather the Necessary Approvals and Licenses: After drafting the essential documents, the next step involves taking the necessary approvals from the government authorities. To start with, the Dubai Free Zone provides different types of licenses related to trading, general trading, service, industry setup, etc.

6. Select an Office Space: By the time you receive all the approvals, which approximately can take up to a week, it is best to start finding an office space. All Free Zones offer excellent infrastructure with the best of amenities, including flexi desk options. Your business setup advisor can take care of this on your behalf.

7. Avail the Core Services to Manage Your Business Operations: After the registration is done you can officially carry out the business operations and for that to run smoothly you need to have a formal corporate infrastructure in place, like accounting, taxation, VAT services, etc. Implementing these services at the start will avoid hassles later. You will be able to streamline the processes from the very start, which will have a fruitful impact when the business begins to grow.

Benefits of a Free Zone License

  1. Complete foreign ownership: One of the most attractive benefits of forming a free zone company in UAE is that complete foreign ownership is possible. This means that the foreign investor need not find a UAE national sponsor for company formation. Foreign ownership is possible irrespective of the nationality of the investor.
  2. Absence of currency regulations: Currency regulations are currency-related restrictions imposed by the government on the transaction of foreign currencies. There are no currency regulations of any kind in UAE free zones. This makes financial transactions easier.
  3. Import and Export duty exemption: Import and Export duties are not applicable to the free zone jurisdictions in the UAE. This helps in promoting international trade.
  4. Tax benefits: 100% tax exclusion is applicable for free zone companies. This includes income tax and corporate tax. 
  5. Repatriation benefits: Companies are eligible for full repatriation benefits. And this includes profits and financial assets.
  6. Smooth Talent recruitment: Free zone companies can conduct labor recruitment formalities easily and in a cost-effective manner. The companies are allowed to recruit foreign nationals
  7. .Readily available workspaces: Warehouses and office spaces are easily available in free zone jurisdictions. UAE free zones are ideal for SMEs and start-ups.
  8. Ease of company Incorporation: The free zone company incorporation procedures are simple and straightforward. You may accomplish the licensing procedures in lesser number of days compared to other jurisdictions.
  9. Trouble-free immigration procedures: Immigration facilities connected with UAE free zones are efficient and therefore saves time.
  10. Excellent communication and infrastructure: UAE free zones have the most updated communication systems with impeccable infrastructure. Free zones enjoy cost-effective and plentiful energy.

The Major Free Zones of Dubai

Fujairah Creative City Free Zone: Fujairah Creative City Free Zone was established in 2005 under the chairmanship of His Highness Sheikh Rashid Bin Hamad Al Shariq. Creative City widely caters to the creative fields such as media, events, consulting, education, communication and marketing, music and entertainment, design and technology. It boasts a long-standing reputation as one of the most established free zones in the United Arab Emirates (UAE).

Fujairah Creative City Free Zone’s diverse ecosystem of different nationalities and background make it an ideal starting point for budding entrepreneurs who are yet to find their niche in the entrepreneurial landscape of the UAE. Setting up your business in the Free Zone through Creative Zone ensures that your startup receives the necessary support and added value.

The major benefits that the Fujairah Creative City Free Zone offers are as follows:

  • Free Zone Company setup options starting from AED 15,625 per year (inclusive of VAT)
  • Physical presence in the UAE not required to incorporate your new company
  • No paid-up share capital or annual audit
  • 100% repatriation of capital and profits
  • All company documentation issued within days
  • Allocation of 6 UAE residency visas

Sharjah Media City Free Zone (Shams): Shams Media City Free Zone (Shams) was launched in 2017 with a vision to be a world-class hub for media and creativity in the region. Shams is strategically located in Sharjah, the UAE’s center for culture and heritage. The addition of Sharjah Media City Free Zone in the emirate signifies the growing number of entrepreneurs from the media and creative industries.

Shams believes in fostering innovation and breakthrough ideas through entrepreneurship. Hence, its mission is to make creative entrepreneurship accessible and to inspire business growth in the region. By setting up your company in Shams through Creative Zone, you will be part of a dynamic community with a holistic, forward-thinking approach.

The major benefits that Shams offers are as follows:

  • Company setup options starting from AED 9,050 per year
  • Physical presence in the UAE not required to incorporate your new company
  • No NOC required
  • No paid-up share capital or annual audit
  • 100% repatriation of capital and profits
  • All company documentation issued within days
  • Investor and partner visas
  • Flexible visa allocation to better suit your company’s requirements


Ras Al Khaimah Economic Zone (RAKEZ): Ras Al Khaimah Economic Zone is based in the heart of Ras Al Khaimah, established in 2017 to oversee and consolidate the specialized zones and clients of the two fast-growing free zones in the UAE: RAK Free Trade Zone (RAK FTZ) in 2000 and RAK Investment Authority (RAKIA) in 2005.

RAKEZ is one of the leading investment hubs in the UAE that offers customizable solutions to free zone and non-free zone businesses. From freelancers and startups to SMEs and industrialists, RAKEZ’s multinational community is flourishing in over 50 industries. Establishing a company in RAKEZ gives you the flexibility to choose a free zone or a non-free zone (Mainland) entity formation. Among the business activities it provides are packaging, manufacturing, ship building and repairing, pharmaceutical, importing, exporting, food industries and robotics.

The major benefits that RAKEZ offers are as follows:

  • Fast and efficient business set-up processes
  • Wide-ranging business and industrial facilities and value-added services
  • Provision to build on-site staff and labor accommodation
  • One-stop shop, a central location for government services
  • Self-service customer portal
  • Connectivity to major logistical hubs and multi-lane superhighways
  • Accessibility via an international spread of regional offices
  • Easy access to markets across the MENA and Asia region

RAK International Corporate Centre (RAKICC): RAK International Corporate Centre is the sole entity in Ras Al Khaimah for the incorporation and formation of International Business Companies (offshore companies). RAKICC was formed from the consolidation of the registries of RAK International Companies (formerly a part of the RAK Free Trade Zone) and RAK Offshore (formerly a part of the RAK Investment Authority). During this process, Ras Al Khaimah’s existing company law was updated to keep pace with developing international standards and the new Ras Al Khaimah International Corporate Centre Business Companies Regulations 2016 were enacted on January 20, 2016.

There are several advantages of RAKICC such as, conducting business as an international entity, protecting investments in other foreign countries, board meetings can be held anywhere in the world, and incorporating a company as a segregated portfolio company among others. Among the business activities it provides are holding shares in international, local or free zone companies; international consulting, investment company, trading activities outside the UAE and holding intellectual property.

The major benefits that RAKICC offers are as follows:

  • 0% Corporation tax, 0% VAT and no income tax
  • No requirement for the owner or director to visit the UAE in person
  • 100% full foreign ownership
  • 100% repatriation of capital and profits
  • Personal presence is not required for company incorporation
  • Confidentiality is preserved; there is no public record of shareholders or directors
  • No audit requirement or requirement to submit financial statements
  • Can maintain bank accounts in the UAE

Dubai South Free Zone: Dubai South Free Zone formerly known as Dubai World Central (DWC) was envisioned to create a vibrant society that invests, lives and works within a sustainable, healthy and happy environment. It is a massive, multi-phased development centered around the world’s largest international airport in the making.

Dubai South serves as a strategic platform for aviation, logistics, commercial, exhibition, humanitarian and residential businesses. Part of Dubai South’s mission is to leverage its location to connect air and seaports, empowering businesses, families and individuals. Among the business activities it provides are aviation, logistics, trading and repairing, transport, storage and communications, education, health and social work.

The major benefits that Dubai South Free Zone offers are as follows:

  • A multimodal platform
  • Strategic location
  • World-class business hub
  • 100% business ownership
  • Flexible office solutions
  • A full range of business
  • Activity options
  • Fewer nationality restrictions

Ajman Free Zone (AFZ): Ajman Free Zone, situated on the coast of Arabian Gulf in the northern part of the United Arab Emirates (UAE), opened its door for local and international investments in 1988. The free zone offers progressive infrastructures and top-of-the-line facilities as a competitive privilege for both local and foreign investors.

The AFZ’s revolutionary initiative in industrial expansions led to its rapid growth, providing credible and reliable processes for any kind of business setup in the free zone. Its accessibility to seaports, airports and road networks allows easy connectivity to neighboring countries. With creative zone, you are able to enjoy all the benefits of a UAE free zone company without the usual costs and constraints, along with a wide range of support services.

The major benefits that AFZ offers are as follows:

  • 100% ownership of establishment/company
  • 100% foreign ownership
  • Easy transfer of capital and profits
  • Exemption from personal income tax, import and export duties, and other taxes
  • Competitive prices for facility usage, power/electricity and leasing
  • Easy access to low-cost labor
  • Well-developed infrastructure
  • One-stop counter service for effecting transactions
  • Fast and easy procedures and in most case, get the license within 24 hours

Khalifa Industrial Zone Abu Dhabi (KIZAD)

Khalifa Industrial Zone boasts world-class transportation infrastructures that enable the trade, industrial and logistics industry in the capital of the United Arab Emirates, Abu Dhabi. KIZAD offers flexible ownership rights to investors as well as lands designed to suit the industrial and logistics businesses.

KIZAD has pre-built warehouses, free zone offices and light industrial units where businesses can easily move in. Designed to fit the specific requirements of businesses, KIZAD makes an ideal place for all types of businesses in the industry.

The major benefits that KIZAD offers are as follows:

  • Choose up to 5 allied activities per license
  • Company license fees starting from AED 13,500 per year
  • Free zone business license and shared workstations.
  • 100% repatriation of capital and profits
  • Tax-free environment
  • All company documentation issued within days

  Dubai Multi Commodities Centre Free Zone (DMCC): Dubai Multi Commodities Centre was established in 2002 as a strategic initiative of the Government of Dubai with a mandate to provide physical, market and financial infrastructure required to set up and operate a thriving commodities marketplace. Today DMCC is officially recognized as the largest free zone in the United Arab Emirates with over 14,100 registered companies.

DMCC aims to promote Dubai as the gateway of trade, helping the government achieve continued economic development. Its highly connected marketplace is essential to all established and emerging businesses in the free zone. As a budding entrepreneur, DMCC is the perfect free zone to thrive. Among the business activities it provides are agriculture, fishing, mining and quarrying, manufacturing, electricity, gas and water supply, construction, trading and repairing, hotels and restaurants, transport, storage and communications, education, health and social work, financial intermediation, other community, social and personal service.

The major benefits that DMCC offers are as follows:

  • Largest free zone in the UAE
  • 100% business ownership
  • Strategic location
  • Flexible office solutions
  • World-class business hub
  • A full range of business activity options
  • Training events
  • Trading platforms
  • Fewer nationality restrictions

Dubai World Trade Center (DWTC): Dubai World Trade Centre Authority benefits from a prime location, making it one of the most accessible free zones in the UAE. DWTC mirrors the majority of Dubai Department of Economic Development activities from commodities to retail outlets and consultancies to beauty salons.

The licensing and leasing opportunities at DWTC Free Zone cater to most entrepreneurs who want to enter the local and regional markets to establish a name in the global arena. Accessible by rail, road networks and nearby airports, DWTC is the perfect location to showcase and access greater international markets. Among the business activities it provides are commercial trading license, general trading license, professional license, event management license and business operating permits.

The major benefits that DWTC offers are as follows:

  • 100% foreign ownership
  • 100% repatriation of capital
  • All company documentation issued within days
  • World-class business hub
  • A full range of business activity options
  • Simplified incorporation process

Dubai Design District (D3): Dubai Design District caters to the needs of budding entrepreneurs from the retail, fashion, design, luxury and hospitality industries. It was announced by His Highness Sheikh Mohammed Bin Rashid Al Maktoum, and backed by the establishment of the Dubai Design and Fashion Council by official decree. Setting up a business in Dubai Design District allows you to work with global artists, fashion designers and brands.

The major benefits that D3 offers are as follows:

  • 100% business ownership
  • Strategic location
  • World-class business hub
  • A full range of business activity options

Sharjah Publishing City Free Zone (SPCFZ): Established in 2017, Sharjah Publishing City is the world’s first free zone concept dedicated exclusively to serving the global publishing and the media industry. It’s easy and flexible business setup packages have made it the one of the fastest-growing free zones in the UAE. SPC provides best-in-class infrastructure replete with fully equipped office and co-working spaces, and comprehensive allied services like printing, licensing and distribution, underscoring its position as a leading economic and investment destination for investors from across the world.

The major benefits that SPCFZ offers are as follows:

  • 1-, 2-, 5- and 10-Year trade license duration options  
  • Visa and non-visa packages available with zero lease agreement cost 
  • 1-year trade license starting at only AED 6,000  
  • Economical and plenty of office spaces  
  • More than 1,800 business activities in commercial, services, trading and e-commerce  
  • 100% foreign ownership  
  • Combine up to 5 activities from different categories  
  • Unlimited number of shareholders  
  • Unlimited number of Visas under one trade license 
  • All immigration services within SPC premises  
  • Instant one-hour license 
  • Dual license (Mainland and Free Zone)  
  • Companies can get 25 years of leasing contract 
  • Less legal requirements for setting up a business 
  • Office facilities open 24 hours with security services 
  • Scaling of businesses with visas is much easier than in any other jurisdiction

About Creative Zone

Established in 2010, Creative Zone is Dubai’s largest and most trusted business setup advisory company. Having helped over 44,000 investors set up operations in the UAE, Creative Zone has played an important role in positioning the UAE as a global hub of business and investment.

The company’s vast team of business setup advisors hold extensive experience and thorough local knowledge of the business landscape, and are well placed to be the partner of choice for any new investor looking to set up in the UAE. The company has evolved to provide added business support services that investors require all through their journey. From co-working office space solutions, legal, tax and accounting advice, as well as banking support and PRO services, Creative Zone understands the key elements needed to set up a successful operation in the UAE.

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