For a foreign investor, it might be a difficult choice to think of over 50 free zones in the UAE. Some investors research the mainland business setup in Dubai vs the free zone business setup in Dubai. After a calculated decision, people opt for free zones. But keep in mind that all the free zones have their costs and different permitted business activities. Also, there can be different share capital requirements for the free zone company.
The activity of the Business
Each free zone has its specific set of activities that are permitted in the particular free zone. Also, there are different rules in each free zone regarding the activities allowed with the same business license. The more the activities of the business, the more it will cost for a license. Sometimes one business requires more than one business license.
Other stipulations in various free zones can make your business not have a service license under the same business. Hence, you need to have another free company setup.
Type of Business Facility
Before business setup, plan for the next few years. It is because you expect a big expansion of the business in the coming years such as hiring more employees, diversification of products or services, etc. The free zones have a minimum installation requirement for the business license in the UAE. But if you plan to meet the clients daily, then you need a separate physical office or location.
Therefore, you should consider the infrastructure and location of the business in a free zone that is efficient, effective, easy to reach, etc. Remember that a free zone company registered in one zone can have only a facility in the registered zone but not the others.
UAE Residence Visas
For each employee, your business in the UAE will need residency visas. The visa fees can depend on the type of facility of the business in the free zone. Also, a shared office can provide a limited number of visas that vary from one free zone to another. Usually, you get two to three visas when it comes to a shared office in Dubai.
If you have a shared office in the Northern Emirates, then you can get more residence visas for your employees. When it comes to a physical office in a free zone, you get a visa fee for every 9 to 10 square meters.
Close to Airports or Seaports
The business in the UAE should be located near airports or ports. The strategic transport routes and hubs can help to reduce expenses as much as possible. It is important for those who want to set up a business venture in the UAE.
Capital Amount
Depositing a share capital is one of the common requirements when registering a company in the UAE. It must be deposited in the company’s account or the account of the UAE Free Zone Authority. Hence, it will help you to know the advance minimum share capital requirement for a particular free zone. Keep in mind that the minimum share capital requirement can vary depending on the business activities.
There are two share capital options:
- Authorized: You don’t have to deposit any share capital
- Paid: You must deposit share capital along with proof of deposit.
In Conclusion
Before deciding on a free zone for your business setup, make sure you have considered all types of costs and regulations of setting up a company in Dubai. Some free zones might not be suitable for the business activities you plan to carry out. Also, make consideration of your business growth in the coming years when you will be hiring more employees to expand the operations. For this purpose, you will need more residence visas for the employees. The going concern of the company will define what kind of free zone will be suitable for the business.
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