The Rules For Dubai Airport Free Zone Businesses
Dubai Airport Free Zone (DAFZA) is one of the most sought-after business hubs for entrepreneurs, offering a prime location, modern infrastructure, and various incentives for businesses. However, before establishing a company in this freezone, it is important to understand the rules and regulations that govern its operations.
Complying with these rules ensures a smooth setup and helps businesses thrive in this competitive environment. Below, we explore key considerations for those looking to proceed with Dubai Airport Free Zone company formation.
Business activities:
One of the first steps when setting up a company in Dubai Airport Freezone is selecting the correct business activity. DAFZA caters to a wide range of industries, including technology, logistics, aviation, media, and trade. However, each type of business activity requires a specific type of license, and it is essential to choose one that aligns with the scope of operations. The freezone authority will review your business plan and ensure that it complies with the allowed activities before granting the license.
Legal structure:
Dubai Airport Freezone offers various legal structures for businesses, such as Freezone Limited Liability Companies (FZ-LLCs), branches, and subsidiaries. Understanding the differences between these structures is vital, as they impact ownership, liabilities, and the type of operations a company can conduct. For example, FZ-LLCs allow 100% foreign ownership, which is an attractive option for international entrepreneurs. Determining the most suitable structure for your business is key to ensuring compliance with the regulations.
Visa and employee regulations:
Dubai Airport Freezone allows businesses to sponsor employees for residency visas. However, there are specific visa quotas based on the office space you choose, so it’s important to plan accordingly. Employee regulations, including salaries and working conditions, must also adhere to the UAE Labor Law. Businesses are expected to provide proper documentation, including contracts and work permits, for all employees.
Tax exemptions and financial reporting:
One of the primary attractions of Dubai Airport Freezone is its favorable tax environment. Companies established within DAFZA benefit from a range of incentives, such as 100% repatriation of profits, no corporate tax for a set number of years, and no customs duties on imports or exports. While these exemptions offer significant cost-saving opportunities, businesses are still required to maintain accurate financial records and comply with the rules regarding financial reporting.
