Checklist for company formation in UAE Free Zones

The Free Zones of UAE are exceptional, utilitarian locations to start a new business in the country. The advantages offered by Free Zones are multiple. Free Zones support 100% foreign ownership, 100% repatriation of capital and profits, free transfer of funds and grants exemption from import and export duties.

Free Zones also facilitate quicker incorporation of business while also extending inexpensive workforce and easy recruitment procedures. They are also efficient providing 25 years lease options, warehouse facilities, availability of dedicated areas for production and assembling.


The following checklist will be helpful to set up a business in any of the free zones of UAE

1. Choose Your Business Type and Legal Identity
The first step to starting a business in a free zone is to decide the kind of business that you want to engage in. This can influence a number of factors including the location of your business. You can choose from thousands of business activities from sectors such as energy, commodities, gold & diamonds, technology, constructions, FMCG, healthcare, aviation, shipping, education, media, professional services, financial services and personal & community services.

Free Zones can also play host to financial businesses like banks, insurance, wealth management and capital markets as well as non-financial businesses like retail shops, restaurants, five-star hotels, art galleries and academic institutions. Certain kinds of businesses can only be established at certain areas due to requirements like adequate resources or disposal of waste generated and pollution prevention.
Before starting a company, you also have to decide its legal identity. According to the number of partners involved in your business, the company can either be a Free Zone Limited Liability Establishment (FZE) or a Free Zone Limited Liability Company (FZ-LLC). A Free Zone LLE can have only one owner while a Free Zone LLC can have between 2 and 5 shareholders

2. Decide on a Great Company Name
The second step for business creation in a free zone is to select a company name. The name chosen should be unique and be indicative of the general purpose of the company. The name is approved only if certain key requirements are met. Some of these are

  • It should not have been previously registered in the country
  • The trade name must not violate the public morals or public order of UAE
  • The name should not contain names of any religion, or governing authority
  • The name must be followed by the legal form of the company, like LLC, FZE etc.
  •  The name should be compatible with the required type of activity and legal status

3. Get the Initial Approval

You need the initial approval to apply for the business license. To obtain the approval you are required to provide:

  1. Filled out application form
  2. Your business plan
  3. If you are an existing company, the copy of existing trade licence/registration certificate (Required only for local company)
  4.  Coloured passport copies of the company’s shareholder/s and the appointed Manager/Director for the new company
  5. Specimen signature of the company’s shareholder/s and the appointed Manager/Director for the new company
  6. 2 years’ audited financial reports for corporate entity or certificate of reference from a personal bank of the individual shareholder
  7. NOC from current sponsor (for individuals)
  8.  Unit title deed
  9.  Letter of Intent
  10. . Registry Identification Code Form (RIC) for Manager/Director (Original & notarised)

4. Paperwork for Registration

After getting initial approval, you need to pay out the registration fees and licence fees. The fees depend upon the type of licence required.

After this, to obtain the business licence and register your business you need to submit:

  1. Completed application for registration
  2. Board Resolution appointing Manager/Director (Notarised and attested)
  3. Power of Attorney given to Manager/Director (Notarised and attested)
  4. Memorandum and Articles of Association (Notarised and attested)
  5. Specimen signature of Manager/Director (Notarised and attested)
  6. Passport-size photo of Manager/Director against white background
  7. Share information about the source of capital for the company

5. Business License and Bank Account

Once the preliminary approval is granted, a letter to open a bank account is issued for the investor to deposit the capital if it’s a requirement from the Free Zone in a UAE-based bank. After the deposition of capital, a letter is collected from the bank and shown to the Free Zone authorities to complete the legal process of registration. This capital must be retained till the trade licence is issued.
This process involves payment of license and registration fees, payment of lease or rent, signing a lease deed, signing the Memorandum of association for the new company and a resolution of the subscribers.

Some free zones allow the process to start even before the capital is shown. The manager, authorized to sign on behalf of the investors, must attest all the legal documents. Once the registration process is completed, the business license is issued and you are ready to start operations.

Companies established in free zones have to abide by the rules of the respective free zones. To get the requisite approvals, you need to apply with the necessary documents. The list of documents depends on the type of business activity, the type of company and the requirements of the free zone authority.

Some of the types of business licences are Commercial/trade, Consultancy/services, Industrial, Educational, Media, e-commerce, Offshore, Freelancer, Warehousing, Manufacturing etc.

6. Immigration and Visa Requirements
Foreign firms will need an Establishment Immigration Card to enable employees to immigrate to the UAE. The EIC is bestowed by the General Directorate of Residency and Foreign Affairs.

Only people aged between 18 and 60 are eligible to apply for an employment visa. An attested educational certificate is mandatory to apply for employment visa for ladies, professional categories and managerial positions.

Most free zone authorities place a limit on the number of visas that can be dispensed to each business. Companies can increase their visa quota by either moving to bigger offices or by applying for an increase in visa quota. This is subject to the approval of the free zone authority.

To get help at any stage of company formation in Free Zones seek the assistance of an established company formation expert.

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