As part of the initiative to encourage more foreign businesses to invest in the Emirate, the Dubai Government set up ‘Free Zones’ or ‘Free Trade Zones’. These are designated business areas within Dubai where businesses are subject to very little or no taxation whatsoever.
Some of the free zones are specific to certain industries, and they are allowed to operate without the intervention of the customs authorities. This is why you see many free zones set up in ports where you find a large number of manufacturers or distributors.
There are many benefits to setting up within a free zone. Firstly, you can establish 100% foreign ownership. Whereas Dubai Limited Liability Companies require a majority holding belonging to a local partner.
On top of that, you are exempt from paying corporation tax for a specified period depending on the zone. This could be 15 years, and you may be exempt for the full amount or a majority of it. In addition to this exemption, you may be able to repatriate the profits to the holding company’s HQ country.
There are additional freedoms, such as the ability to operate 24/7, and the availability of cheap resources – administrative, amenities, infrastructure – the free zones are generally very well connected and well resourced.
Those freedoms are limited, however, and the business cannot go beyond the borders of the free zone to operate. Any local operations have to be undertaken by local businesses, and the free zone may have a very specific industry.
The following is a list of some of Dubai’s more prominent Free Zones:
Dubai Healthcare City
Dubai Healthcare City is a healthcare free zone which was launched back in 2002. The businesses here are principally healthcare, medical education and research, pharmaceutical, medical devices and medical equipment.
A second phase is under construction at the moment and will be dedicated to Wellness – this will cover 19 million square feet.
15% of visitors to Dubai Healthcare City are medical tourists. Around 1 million people pass through the city each year, visiting the many hospitals and laboratories.
Dubai International Academic City
DIAC, as it is known, is a base for schools, colleges and universities. Over 12,000 students attend the 13 international Higher Education Institutes within DIAC, which include the British University in Dubai, the French Fashion University Dubai, the American Universities in Dubai and in the Emirates, Heriot-Watt and… the Murdoch University Dubai. Among others.
Dubai Internet City
The residents of Dubai Internet City are granted a number of tax and custom benefits for 50 years. Specifically for Internet companies, this technology park is home to over 850 different companies with 10,000 employees coming to work there every day.
Dubai Knowledge Village
Dubai Knowledge Village is all about professional learning and Human Resources. Also known as a free zone ‘campus’, the businesses here provide corporate training, and you’ll find Computer Training, Professional Development Centres and HR Consultants.
This Free Zone used to house the universities and other institutions before they were moved away to the Dubai International Academic City.
Dubai International Financial Centre
DIFC is a federal financial Free Zone, and has its own legal system and courts! The original ambition of the Free Zone was to provide a platform for business and finance institutions to work with the rest of the UAE and beyond.
The independent jurisdiction is under the UAE Constitution – and the laws and regulations are written in English. In fact, they default to English law when there is ambiguity. Judges are taken from England, Singapore and Hong Kong.
DIFC doesn’t just have finance establishments – it has art galleries, hotels and over 40 cafes and restaurants, as well as a shopping mall.
Dubai Media City
Dubai Media City (DMC) is the hub for all media in Dubai – in fact, it’s the main hub for the whole of the Middle East. 1,300 companies are based in the Free Zone, and it also houses the International Cricket Council, the governing body of World Cricket.
Here, you’ll find news agencies, publishers, online media companies, production and broadcast facilities.
Dubai Silicon Oasis
Silicon Oasis (DSO) doesn’t have a specific trade as such, but is hope to a number of IT companies, consultancies, automobile companies, aerospace companies and more, specifically for import/export and manufacturing, as well as head offices.
That covers a lot of business (SAP and Fujitsu, to name but two, are here), and the DSO is all about investment in infrastructure to support the high-tech businesses who operate there – a network of roads, 15 minutes from the airport, with fire, water and irrigation system as well as a fibre-optic network and data centre, make it a natural choice for high-tech business.
If you are thinking of moving to Dubai for work commitments; it might be an idea to look at communities near these free zones as that is where most businesses reside. Whether you’re looking to buy a property in Dubai or rent in Dubai, Espace Real Estate boast a professional service to help you make the right decision.
As a truly customer-centric real estate agency, we offer a range of related services that are designed to make your property journey stress-free and successful from start to end.
