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IFZA Free Zone

Fujairah Free Zone Company Setup. Business Formation in International Free Zone Authority (IFZA), the UAE

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Get the details about company formation in IFZA Free Zone

Phone number: +971 (4) 425 6062

Office hours: Sunday - Thursday from 9-00 to 17-30

  1. Fujairah Free Zone
  2. Advantages of business setup in Fujairah free zone
  3. Free zone company setup – types of companies in Fujairah free zone
  4. Types of licenses in the UAE and their purpose
  5. The difference between offshore and onshore companies
  6. Available infrastructure in Fujairah free zone
  7. Documents required for Fujairah free zone company registration

Fujairah is one of the seven Emirates, a part of the UAE federation. It is located in the east of the country and has direct access to the Gulf of Oman; the Emirate occupies the area of more than 90 km along the coastline. In recent years under the leadership of Sheikh Hamad bin Mohammed Al Sharqi, Fujairah has become an international cultural, tourist and financial center of the region and this is not least due to the free zones located on its territory: Fujairah Free Zone and Fujairah Creative city.

Another thing in favor of investing in the Emirate is IFZA (the meaning of it is as follows: International free zone authority), a modern investment center, intended to attract foreign businessmen. Here they offer an individual approach in choosing the best cost-effective investment solutions. By contacting IFZA, you can choose the best option for you to register a company in one of the free zones of the UAE. All current information on the international investment center IFZA and its services can be found on their official website: http://www.ifza.ae.

Fujairah Free Zone

This free economic zone consists of a whole complex of territories and strategic facilities, including the port and Fujairah international airport, as well as several business centers in the city itself. Fujairah Free Zone is located next to the international port, which allows to transport cargo of all shapes and sizes.

Fujairah free zone in Fujairah city, the UAE (Google maps)

Fig. 1 – Location of Fujairah free zone in Fujairah city, the UAE (Google maps)

By registering a company in Fujairah free zone and obtaining the appropriate license (trading, industrial and consulting), you get tax and customs preferences and access to emerging markets of the region. Everything required for effective business development can be found on the territory of this free zone: warehouses, offices and industrial premises, transport, communications, etc.

Advantages of business setup in Fujairah free zone

The UAE free zones are known for their unique business climate. Here is a list of key benefits that make company formation in the Fujairah free zone a very profitable solution:

  • No taxes, both for individuals and corporate clients. Profit tax, corporate tax, dividend tax – there are no taxes typical for the citizens of the Western world.
  • No trade barriers, duties, quotas, etc. Customs rules in the Fujairah free zone are simplified as much as possible; a foreign investor has almost no barriers for business setup. The only limitation is import duties on goods in the amount of 5% in the case if they are intended for the domestic market of the UAE; in other cases, there are no duties or quotas.
  • Full company ownership for foreigners. This rule is typical for all free zones in the UAE, in contrast to the rest of the country, where foreigners are allowed to own no more than 49% of the company's assets.
  • There are no restrictions on the repatriation of income and capital. There are no restrictive mechanisms that would prevent the free movement of capital.
  • A simplified system of registration and licensing of a company. It is conducted by a single body in each free zone – Free Zone Authority.
  • Access to local banks. Company registration in Fujairah free zone provides you the opportunity to open an account in one of the local banks, which are famous for their reliability and low-cost service.

Also, the consulting services market is rather developed here, so you can entrust the implementation of all the routine operations of the consulting company, saving time for developing your business.

Free zone company setup – types of companies in Fujairah free zone

As in most other free economic zones, Fujairah free zone offers several types of companies for registration, namely:

  • Free Zone Establishments (FZE). FZE is a type of company with minimum requirements for registration. Such a company is opened by a single founder, both an individual or a legal entity. There are no requirements for minimum investment capital for FZE.
  • Free Zone Limited Liability Company (FZ LLC). In order to open this type of company, there should be at least two founders, which can be both individuals and legal entities. There are no minimum investment capital requirements for Free Zone LLC.
  • Branch is a branch of a foreign company. A branch is legally dependent on its parent company. There are no requirements for minimum branch investment capital.
  • An offshore company is a special type of company that can be registered in the UAE. Unlike the other types, this company is not considered to be a resident of the UAE, therefore, it is exempt from any types of taxes and fees, it does not require a license or a physical office, the company setup procedure and reporting are simplified for it, at the same time, an offshore company has no right to conduct business directly in the territory of the country. This is a perfect solution if you plan to conduct international business.

Types of licenses in the UAE and their purpose

Obtaining a license is an obligatory requirement for a free zone company in the UAE. The licensing procedure in this free zone is carried out by the local authorities; there is no need to contact other government bodies. Before starting a company setup in Fujairah free zone, you must decide what type of activity will your company be engaged in and what type of license you will need:

  • Trading and General Trading License; You need this type of license if you are going to trade. If you are going to trade with a certain group of goods, then you can apply for the usual commercial license. But if you are going to sell lots of different types of goods, then you will need a general trade license.
  • Manufacturing/industrial License; This type of license is needed for companies whose activities are related to production: factories, plants, assembly departments. If you get this license, you can export your products to other countries of the world without any restrictions.
  • Consultancy/Services License; This type of license is required if you want to provide specialized services. For example, business and financial consulting, consulting on customs, technical and other issues, and other types of services. That is this type of license suits any company that provides certain services.

Regardless of the type of license chosen, this document is valid for one year, that is, you must renew your license annually. If not, it may result in a fine or even lead to the closing of your company. The procedure for obtaining any type of license is quite simple, it costs about AED 2,500..5000 (depending on the type of license), and it takes no more than one week to complete (in most cases).

The difference between offshore and onshore companies

When choosing the type of company that you want to register in the Fujairah free zone, it is important to understand what your company will do, what your target markets are, and what operating costs will be optimal for your business. The table below describes

Table 1 – Differences between an onshore company (free zone company) and an offshore company

 

free zone company

Offshore company

Activities within the free zone

Business activity is allowed both within the zone and in other countries

Business activity is allowed only outside the free zone

License

Any company must obtain a license

Licenses are not required.

Resident visa

Enables investor and his family members to get a resident visa

Does not give an opportunity to get a resident visa

Physical office

Must be a physical address

A virtual office is allowed.

The account in a local bank

You can open an account at any local bank.

Not all banks open accounts for offshore companies, there are certain restrictions

VAT (5%)

The company is subject to VAT

The company is not subject to VAT

Company formation process and its cost

The company registration procedure is more difficult because of the need to rent an office and get a license; company setup cost is higher, operating costs are higher

The company registration procedure is simpler because you do not need a physical office and a license, the company setup cost is lower, operating costs are lower

Available infrastructure in Fujairah free zone

Fujairah free zone offers various premises for offices and warehouses, as well as land plots for construction. You can choose the best option for yourself:

  • Flexi desk. The price includes the rental of a legal address, mailbox, telephone line and a qualified secretary who will communicate with your customers. You can customize the order of work of this person for the best option.
  • Representative office. The Fujairah Free Zone offers a wide choice of furnished and not furnished premises for offices with a size of more than 20 m2. Every 10 m2 of leased space give the right to get an additional work visa for an employee. Telephone, fax, air conditioning, parking spaces – you can count on all the amenities of a modern office center.
  • Warehouse. For large industrial and trading companies, Fujairah Free Zone offers equipped storage facilities with all the necessary communications, ranging from 500 m2.
  • Building Areas In the Fujairah Free Zone, you can rent a vacant land plot for your needs for the long term. The maximum area of the plot is 5000 m2.

Documents required for Fujairah free zone company registration

Here is a list of documents that must be collected and filed with the application for opening a company in the Fujairah free zone:

For an individual:

  • Information about the applicant;
  • Copy of the applicant's passport;
  • A letter of recommendation from the bank;
  • Proof of residence (utility bills, such as water and electricity bills, confirming the applicant's address);
  • Copy of the director’s passport (must be at least one director, the shareholder may be a director).

For legal entity:

  • Certificate of registration of a company, duly legalized and certified by the UAE embassy in the country of origin;
  • “Certificate of good standing” of the company, duly legalized and certified by the UAE embassy in the country of origin;
  • Memorandum and articles of association of a company (applicant company) duly legalized and certified by the UAE embassy in the country of origin;
  • A letter of recommendation from the bank;
  • The decision of the Board of Directors on the registration of a company in the UAE, the appointment of directors (at least one director is required), duly legalized and certified by the UAE embassy in the country of origin.

In order to simplify the whole registration procedure in the Fujairah free zone, you can use the services of business consulting companies. Among the main services of such companies are assistance in choosing the optimal jurisdiction, choosing the optimal type of company, assistance in applying documents, obtaining a visa and a license, opening a bank account, in a word, they will help to go through all stages of company formation in the UAE.

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IFZA Free Zone

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