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Business Setup in Abu Dhabi Free Zones

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Why Set Up a Business in Abu Dhabi Free Zones

There are several reasons why setting up a business in Abu Dhabi free zones can be advantageous for entrepreneurs and businesses alike:

100% Foreign ownership

In Abu Dhabi free zones, foreign investors can own 100% of their company without needing a local sponsor or partner.

Tax Benefits

Companies operating in Abu Dhabi free zones are exempt from taxes such as corporate tax, personal income tax, and value-added tax (VAT).

Easy Company Formation:

Setting up a business in Abu Dhabi free zones is streamlined, with simplified procedures and reduced paperwork.

Access to World-class Infrastructure

Abu Dhabi free zones offer state-of-the-art infrastructure and facilities, including advanced logistics and transportation networks, modern offices and warehouses, and advanced communication technologies.

Proximity to Key Markets

Abu Dhabi's strategic location between East and West makes it an ideal hub for businesses looking to access markets in Asia, Europe, and Africa.

Business-Friendly Environment

The Abu Dhabi government has implemented several initiatives to create a business-friendly environment, including introducing pro-investment policies, streamlined business procedures, and support for innovation and entrepreneurship.

How to start a Business in Abu Dhabi Free Zones?

Here are the steps to start your business in Abu Dhabi Free Zone.

1

Define Business Activity/Structure

Before starting a business in Abu Dhabi, defining the business activity and structure is essential as the first step. This involves deciding on the type of business activity, such as trading, manufacturing, or services, and the business’s legal structure, such as sole proprietorship, partnership, or limited liability company. 

The choice of business activity and structure will impact the company’s legal requirements, tax liabilities, and other regulatory considerations, making it a critical decision for any entrepreneur or business owner looking to establish a presence in Abu Dhabi.

2

Choose the type of license you need

Choosing the right license type is crucial in starting a business in Abu Dhabi. The type of license required will depend on the company’s business activity and legal structure. The three main types of licenses available in Abu Dhabi are:

Commercial License: This license is required for businesses engaged in trading or commercial activities such as buying and selling goods.

Industrial License: This license is required for businesses engaged in manufacturing, processing, or industrial activities.

Professional License: This license is required for businesses providing professional consulting, accounting, or legal services.

It is essential to choose the correct license as it will determine the company’s legal status, operational scope, and the permits required to conduct business in Abu Dhabi. Obtaining the right license ensures compliance with local laws and regulations, which is essential for any business in Abu Dhabi.

3

Obtain Free Zone Trade License

Obtaining a Free Zone Trade License is an essential step in starting a business in Abu Dhabi’s free zones. This license is issued by the relevant free zone authority and permits the company to conduct business within the designated free zone area. 

To obtain a Free Zone Trade License, the company must first register with the chosen free zone authority and submit the necessary documentation, such as the company’s Memorandum and Articles of Association, passport copies of shareholders and directors, and a detailed business plan.

Then, the free zone authority will review the application and, if approved, issue the Free Zone Trade License. This license allows the company to conduct business activities as per the scope mentioned in the license without needing a local sponsor or partner, offering 100% foreign ownership of the company.

4

Submitting a Visa Application

Submitting a visa application is necessary to start a business in Abu Dhabi. After obtaining the necessary business licenses, visas must be obtained for the company’s owners, shareholders, and employees to reside and work in Abu Dhabi legally. 

The visa application process involves submitting the required documents to the relevant authorities, such as passport copies, passport-size photographs, medical fitness certificates, and a valid Emirates ID. 

The visa application process can be done through a local sponsor or through the company’s Free Zone authority. The visa application process varies depending on the individual’s nationality, the type of visa required, and the purpose of the stay in Abu Dhabi. 

Therefore, it is recommended to consult with a visa services provider or immigration consultant for guidance on the visa application process to ensure that all requirements are met accurately and efficiently.

5

Apply for Free Zone Bank Account

Opening a Free Zone Bank Account is essential in starting a business in Abu Dhabi’s free zones. The Free Zone Bank Account allows the company to conduct financial transactions and receive payments in a secure and regulated environment. 

To apply for a Free Zone Bank Account, the company must provide the necessary documentation, such as a valid trade license, passport copies of shareholders and directors, and proof of address. The application process varies depending on the chosen bank and the type of account required, and it can take a few days to a few weeks to complete. 

Therefore, it is recommended to consult with a financial advisor or banking expert for guidance on the account opening process to ensure that all requirements are met accurately and efficiently.

6

Finalize Business Setup

Finalizing the Business Setup is the last step in starting a business in Abu Dhabi. It involves obtaining the necessary approvals, permits, and registrations to operate legally and officially launch the business. The finalization process includes the following:

  • Obtaining a commercial lease agreement for a physical office or workspace.
  • Registering for local taxes.
  • Obtaining necessary permits and approvals from relevant authorities.
  • Ensuring compliance with local laws and regulations.

The process can vary depending on the business activity and legal structure. Therefore, it is recommended to consult with a legal or business advisor to ensure that all requirements are met accurately and efficiently. Once all the necessary approvals and registrations are obtained, the business is ready to start its operations in Abu Dhabi.

Documents Requirements for Company Formation in Abu Dhabi Free Zones

Disclaimer: Certain business activities may require additional approvals from relevant government entities. Below are some examples of such activities, categorized by the ministry:

The documents required for company formation in Abu Dhabi Free Zones may vary depending on the free zone authority, business activity, and legal structure of the company. However, some standard documents required for company formation in Abu Dhabi Free Zones are:

  • Passport copies of shareholders and directors
  • Proof of address of shareholders and directors
  • A business plan outlining the company’s objectives and operations
  • Memorandum and Articles of Association
  • Power of Attorney, if applicable
  • Board resolution for company formation
  • No Objection Certificate (NOC), if applicable
  • Attested educational qualifications and experience certificates of the shareholders and directors
  • Share capital certificate, if applicable
  • Trade name reservation certificate
  • Audited financial statements, if applicable

It is recommended to consult with the chosen free zone authority and a legal or business advisor for guidance on the documents required for company formation in Abu Dhabi Free Zones and to ensure that all documents are submitted accurately and efficiently.

List of Free Zones in Abu Dhabi

Abu Dhabi is home to several free zones, each with unique features and benefits. Here's a list of the major free zones:

Abu Dhabi Free Zones

Abu Dhabi houses several free zones that provide numerous advantages and incentives for enterprises seeking to establish themselves in the UAE. Below are some of the most preferred free zones for business setup in Abu Dhabi.