UAE Free zones are attractive jurisdictions for investors who wanted to have 100% ownership of their businesses. The idea of a ìFree Zoneî has been established internationally as a model to develop and promote business in many countries. Since UAE Free zones are offering 100% foreign ownership, Zero tax and customs privileges which make the UAE free zones the most favourable locations in the Middle East for international operations and appeals many in Free zone company formation in UAE.
The main difference between an ìEstablishmentî and a ìCompanyî is the number of shareholders required. An ìEstablishmentî is a single-shareholder (either a person or a company) while a ìCompanyî is actually a Limited Liability Company and generally requires 2 or more shareholders.
Both offer the same operational benefits. Depending on the Free Zone there may also be differences in the share capital requirements. Some free zones even donít require any share capital.
You will be the 100% owner of a Free Zone company and by having this structure you can trade internationally and between the free zones, you can import / export the goods without any taxes or duties however, dealings with mainland (Dubai) will be subject to 5 per cent duty as well as you cannot sell your products within Dubai mainland directly but only through distributor or agent. There are number of developed free zones in Dubai,UAE i.e Jabel Ali Free zone (JAFZA) , Dubai Multi Commoditity Centre (DMCC), Ajman Free Zone, Dubai Free Airport Free Zone, etc..
Each Free Zone is set to register companies in their own line of business and each one of them has a different set of requirements, cost and legal structure. The choosing right jurisdiction depends on short term and long term objective of the firm and cost difference.