Free Zone
A free zone in the UAE is a specially designated economic area that operates under its own set of regulations, distinct from mainland business laws. These zones, spread across various Emirates such as Dubai, Abu Dhabi, Sharjah, Fujairah, Ajman, Ras Al Khaimah, and Umm Al Quwain, provide businesses with exclusive benefits.
Free zones are known for offering tax incentives and allowing 100% foreign ownership, making them highly attractive to international investors. The establishment of these zones aligns with the UAE government’s goal to diversify its economy and attract foreign investment, creating a vibrant entrepreneurial landscape.
The first free zone, Jebel Ali Free Zone, was launched in 1985, and today there are around 43 free zones throughout the country.
General Trading License
A General Trading License in the UAE allows companies to engage in the sale, distribution, storage, import, export, and re-export of a wide variety of goods under one license. This license provides flexibility by covering a broad range of activities, including trading in foodstuff, furniture, electronics, and more. It offers businesses the freedom to operate across various sectors within the Free Zone, without being restricted to specific types of goods. However, certain activities may require a No Objection Certificate (NOC) for special approvals. This license is ideal for companies looking to expand their commercial activities and tap into a diverse market.
Commercial License
A Commercial License is essential for businesses involved in the sale of products or services within the UAE and internationally. Entrepreneurs conducting economic activities in Dubai must apply for this license to legally operate. It allows businesses to purchase, sell, and trade goods both locally within the UAE and in international markets. Additionally, the commercial license permits the import and export of items, making it an ideal choice for companies looking to engage in cross-border trade or operate within a Free Zone. This license provides the necessary legal framework for businesses to conduct their commercial activities smoothly and efficiently.
Industrial License
An Industrial License in the UAE is issued by the relevant free zone authority, allowing investors and entrepreneurs to manufacture products within the designated free zone. This license facilitates the import of raw materials for production and the export of finished goods to international markets. It is essential for businesses involved in industrial or manufacturing processes, as it covers activities such as importing raw materials, production, and packaging for export. With this license, businesses can legally operate in the industrial sector and take advantage of the UAE’s strategic location for global trade.
Service License
A Service License in the UAE allows the licensee to offer a range of specified services within the Free Zone, such as logistics, courier services, insurance provision, travel and tour services, car rentals, consulting, and staffing. It also covers professional services such as accounting, legal, and business consulting. This license is designed for professionals in various fields who provide specialized services, including business consulting, IT services, accounting, auditing, and legal services. With a service license, businesses can legally operate in the UAE’s service sector, offering their expertise to local and international clients.