If you’re thinking of setting up a business in the UAE, the country’s innovative free zones provide a great place to grow a new company. Offering a host of benefits designed to help local and foreign-owned businesses thrive, they are the perfect option for expats and immigrants wanting to start their own ventures. With locations in major cities like Dubai and Abu Dhabi, each of these zones has unique characteristics that make them suitable for different types of businesses.
At Remitly, we help our customers move abroad by providing useful guides as well as convenient money transfer services. In this article, we’ll share details on what UAE free zones offer for expats setting up small businesses.
Top five free zones for new business ventures in UAE
As an entrepreneur, you’ll want to know about the most promising free zones in the UAE and the benefits that ensure businesses get off to a smooth start and end up thriving.
1. Jebel Ali Free Zone Authority (JAFZA)
Jebel Ali Free Zone (JAFZA) is a top choice, having won multiple global awards in 2024. If your business deals with trading, logistics, or manufacturing, JAFZA is an ideal pick thanks to its prime location near the Jebel Ali Port and Al Maktoum Airport.
You’ll be at the doorway of global trade right from the start, and the infrastructure offered is world-standard. This is a great option if you’re hoping to scale up big and fast.
2. Dubai Multi Commodities Centre (DMCC)
Dubai’s Dubai Multi Commodities Centre (DMCC) is perfect for commodities like gold, diamonds, or crypto, as it has the necessary licences for precious metals. Located in the heart of Dubai, it offers a friendly ecosystem with networking events and business support so you can feel connected and supported throughout your journey.
3. Dubai Silicon Oasis (DSO)
If your startup is tech-based, Dubai Silicon Oasis (DSO) might be the perfect location. It’s a playground for startups and innovators interested in IT, software, or anything cutting-edge.
The costs are reasonable, with co-working spaces and tech parks that make it easy to get rolling without breaking the bank. Plus, it has a real startup community feel, which can be a game-changer when you’re still new to the business world.
4. Abu Dhabi Global Market (ADGM)
The Abu Dhabi Global Market (ADGM) is a heavy hitter in Abu Dhabi, especially for fintech or financial services. Its prime regulatory setup is recognised globally, so if you’re dealing with anything finance-related, this could be your spot.
The tax benefits are preferable, too, with zero corporate tax for qualifying businesses and a sophistication that screams legitimacy.
5. Sharjah Media City (SHAMS)
Finally, Sharjah Media City (SHAMS) is a fantastic free zone if you’re working in media or creative industries and want something budget-friendly. Benefits here include quick setup and low fees. Additionally, they offer services and training tailored for creative entrepreneurs, building an ecosystem designed to help you thrive in your media startup.
Why is it important to choose the correct free zone for your business?
As an entrepreneur, choosing the correct free zone to set up your business in the UAE can be crucial. Let’s look at the benefits of getting set up in the zone that fits your business, and how to give your startup every chance at success.
Industry fit unlocks benefits
To begin with, each free zone has its particular specialisation. Some focus on trade and logistics, others lean into technology or finance, and some cater to creative gigs. You’re going against the tide if you set up in a zone that doesn’t match your industry.
For instance, if your company focuses on importing goods, setting up in a media-focused zone might leave you scrambling for the right connections or infrastructure. A place like JAFZA, though, with its port access, would have you sorted from day one. It’s about matching your needs to what the zone’s built for.
Zone choice affects your costs and profits
Cost is another element to consider. Free zones aren’t one-size-fits-all regarding fees. Some are more expensive but offer premium perks, while others offer the minimum for a more affordable price.
If you pick one that’s too expensive, you’ll be overspending before you even turn a profit. Go too cheap in the wrong spot, though, and you might miss out on the networks or facilities that could’ve saved you headaches later.
SHAMS, for instance, is excellent for those on a tight budget, but if you need heavy-duty logistics, you’ll appreciate the benefits you’ll get with JAFZA.
Rules and regulations
The rules matter, too. Every zone has its quirks. Some let you trade locally without jumping through hoops, while others are stricter about staying export-focused.
If you get this wrong, you could hit roadblocks like extra taxes or permits when you try to sell in mainland UAE. For example, ADGM is excellent for fintech because of its global-standard regulations, but those rules might feel excessive if you’re not in that line of business.
Community vibe and reputation
Another element to consider is the community experience. Some zones, like DMCC or DSO, cultivate a buzzing ecosystem with events, meetups, and mentors that can quickly connect you with the right people.
If you’re in a zone that doesn’t offer the right community for your industry, you’re missing out on those growth and networking opportunities that can be crucial elements for business success.
Location drives your opportunities
Finally, location is an essential factor to weigh in your choice. Depending on your industry, being closer to ports, airports, or clients can slash shipping times and costs.
If you set up too far from the action, you’ll be spending extra money on logistics and could even lose deals because you can’t deliver fast enough. JAFZA offers great logistics support, but if your clients are all in downtown Dubai, DMCC might save you more in the long run.
Key benefits of UAE free zones
UAE free zones offer crucial benefits to small business owners—especially expats.
Free zones allow 100% foreign ownership
UAE free zones eliminate the need for a local business partner and allow for full foreign ownership. Outside these zones, businesses need an Emirati sponsor, which can create complications.
If you come from abroad and want complete control over your business, setting up in a free zone allows you to call all the shots and keep all the profits.
Tax exemptions and incentives
Taxes can be a massive spend for startups around the world, but in UAE free zones you won’t pay corporate or personal income tax in most cases, sometimes for decades.
Some zones also offer VAT breaks or customs duty waivers. These give your business some financial breathing room, freeing up more cash to invest in growth.
Step-by-step: how to start a business in a UAE free zone
Starting a business in the UAE might initially feel overwhelming, but free zones streamline the process. You’ll just need to apply for your business licence and fill out a few forms. This might mean you can get set up in just a few days, saving you time and stress and getting your business up and running quickly.
Below is the step-by-step process for getting started in a UAE free zone.
1. Legal requirements and registration process
Once you’ve chosen your zone, the first step is to register. Depending on the zone, you’ll need your passport, a business plan, and a few forms, which you can pick up in person or download online.
You can submit your application online or in person, pay the appropriate fee, and wait for approval. The whole process normally takes just a few days.
2. Select the appropriate business license
Selecting your licence will require you to figure out your niche. Are you starting a business in trade, services, or media? Different zones offer different types of licences, such as commercial or freelance. Costs also vary from one zone to the next—for example, SHAMS is more affordable, with setup packages starting at 5,750 AED, while JAFZA is pricier.
3. Set up bank accounts and facilities
You’ll have to open a bank account in the UAE when you’re done registering. You’ll need to bring your business licence and ID to do that. As is the case with most modern regions, you can do most of this process online for convenience.
Once you’re done with the bank registration, you’ll need to find a suitable facility to host the business. You have the option to rent an office or flexi-desk for business operations. Finally, you’ll sign the lease agreement, and you’ll be ready to get started.
UAE free zones: a host of benefits for startups
The UAE’s top free zones, like JAFZA for logistics, DMCC for commodities, Dubai Silicon Oasis for tech, ADGM for fintech, and SHAMS for media, each have something unique. Picking the right one hinges on your business idea, budget, and growth plans. Getting set up in the right free zone means you’ll not only enjoy a seamless start to your business but also create a firm foundation to thrive.
FAQs
Which free zone is the best in the UAE?
The best free zone in the UAE largely depends on the type of business you want to do. JAFZA is the ideal pick for logistics-related startups, DMCC is ideal for commodities, Dubai Silicon Oasis is best for tech, and ADGM can be the best for fintech.
Which is the cheapest free zone in the UAE?
Sharjah Media City, or SHAMS, is generally considered the most affordable. It is an ideal free zone for entrepreneurs looking to enter the media or creative industry.
How much does it cost to set up a free zone business in the UAE?
The amount of money you spend to set up a business depends on the free zone you choose, the type of licence you want, the business activity, and the office space if necessary. Most free zone websites offer a cost calculator to find out exactly how much you’ll spend.