About Jebel Ali Free Zone (JAFZA)
Established in 1985, JAFZA is the oldest free zone in the UAE. Today, it is home to over 8,600 companies from more than 100 countries, including almost 100 Fortune 500 organisations.
The free zone is incredibly well connected, directly linked to one of the busiest ports in the world and around half an hour away from two international airports.
Prices starting from AED 50,000
Average business setup time: up to 4 weeks
Benefits of setting up a company in: JAFZA Free Zone
100% BUSINESS OWNERSHIP AND CAPITAL REPATRIATION
As an expatriate, you can own 100% of the company and remit all profits to your home country.
JAFZA issues industrial, service and trading licences to combine multiple activities.
JAFZA free zone is directly linked to Jebel Ali Port—one of the busiest cargo ports in the world.
JAFZA offers a range of on-site customs services, re-export for the MENA region.
RANGE OF SERVICES
JAFZA offers several government and business services in conjunction with the Dubai government.
JAFZA Free Zone welcomes a range of financial and professional business activities. Here are some of the most popular options:
Sea Cargo Service
All Trading Activities
Physical Presence Requirement
You do not have to be physically present to complete the setup process of your company.
What Is JAFZA and Why You Should Start Your Company Here?
The UAE has been known for decades as an economy built on petroleum and natural gas. However, with an economy that’s slated to grow 2.1% in the coming year, it’s also an ideal place for investors to open companies.
One of the hottest areas for anyone wanting to start a company is in JAFZA. The JAFZA Free-Zone is one of the UAE’s many up-and-coming districts for business owners to invest in.
If you’re ready to get started with a JAFZA company setup, this guide is for you. Here’s everything you need to know about opening and registering a business in JAFZA.
What Is JAFZA?
JAFZA is short for Jebel Ali Free Zone Authority and is one of the oldest free zones in Dubai. This free zone was first set up back in 1985, making it the oldest free zone in all of the United Arab Emirates.
Over the years, JAFZA has continued to be a hot spot for business owners looking to set up shop in Dubai. It offers incredible opportunities to investors and is currently home to thousands of business operations.
The free zone is within easy access of the Jebel Ali Sea Port, as well as the Al Maktoum International Airport. That means it’s perfect for transporting goods and conducting operations around the world.
Aside from these two methods of transportation within the area, the Etihad Rail is currently under construction. The railway will eventually link JAFZA to the rest of the Emirates, making it easier than ever to transport goods across the country.
Business Activities Allowed in JAFZA
One of the main reasons why so many investors are choosing to set up shop in JAFZA is due to the many business activities that are allowed in the area. You can choose to start a business in several different industries within the area.
Company owners that start a business in the industry may operate using two different types of licenses. Type 1 allows businesses to offer up to 7 products from the same group, while Type 2 allows businesses to offer up to 12 products from the same group.
Businesses can add an additional activity to either type of license for AED 500.
The trading industry includes a number of different activities, including:
- Agricultural activities
- Train, sea vessels, and aircraft trading
- Supplies and amusement equipment
- Paper and packaging materials
- Build materials
- Fuel and petroleum
- Equipment and machines
- Beauty and medicines
- Food and beverages
- Motor vehicles
- Sports equipment
- Tobacco and smoking accessories
- Exchange and financial
- Household furniture
Any of these activities are considered to fall under the trading category. That means that you can open a business no matter what you specialise in.
There are several activities that fall under the services category in JAFZA as well. These activities include:
- Machinery, equipment and repairs
- Transport, storage and shipping services
- Banking and financial services
- Surveillance services
- Building maintenance and management services
- Cleaning services
- Car rental and transportation services
- Consulting services
- Contracting and building services
- Gas station services
- Document storage and destruction services
- Event and exhibition organisation services
- Government liaison
- Food supply services
- Hospitals and recovery house services
The third major category of activities in JAFZA is industrial activities. Businesses operating in this category can perform numerous activities, such as:
- Building materials manufacturing
- Textile and textile product manufacturing
- Glass industries
- Handicraft workshops
- Medicine manufacturing
- Vehicle manufacturing
- Rubber products manufacturing
- Wood products manufacturing
- Tobacco product manufacturing
- Meat processing
- Paper manufacturing
- Metal, petroleum and chemical manufacturing and extraction
- Plastic industries
- Power transmission and generation
- Technical and professional workshops
There are many other industrial activities that are permitted in the Jebel Ali Free Zone. Make sure to look up your specific business purpose before starting your company to ensure you comply with the area’s regulations.
Benefits of Starting a Business in JAFZA
Business owners that choose to start a company in JAFZA are able to take advantage of several key benefits. Here are a few of the reasons why thousands of investors are flocking to this area for business formation.
The company setup process in JAFZA is one of the fastest and most straightforward out there. For one, the area allows for full repatriation of profits and capital, allowing business owners to have better control over their company’s finances.
On top of that, businesses are only required to determine what form of establishment they will operate under. After this step is complete, businesses are allowed to start operations in as little as 10 days after submitting their documentation.
Probably the biggest benefit of opening a business in JAFZA is that it allows three different permits without having to have a physical office location. That makes it easy to get a visa.
Business owners can start a company in the area without having to be physically present. All they have to do is use the flexi-desk option offered in this free zone.
Better yet, it’s extremely easy to sponsor dependents in this free zone. Any business owner who wants to sponsor a dependent in the area can easily do so without having to go through mountains of paperwork.
Tax and Currency Benefits
Many free zones have currency restrictions, making it harder for international investors to move in and start business operations. JAFZA, on the other hand, has no currency restrictions.
Plus, there are no personal or corporate income taxes in this free zone. Talk about getting some huge cost savings!
No Minimum Share Capital
Whereas many free zones in the UAE require a minimum share capital in order to start a business, JAFZA does not. Investors are not required to meet a minimum amount of money in order to launch operations.
The result is that young entrepreneurs are able to start their business operations much faster than in other locations. Without any minimum startup fee requirements, they can open a company and begin operations right away.
Another major benefit of the Jebel Ali Free Zone is its location. This area is home to the most developed port in the entire region, as well as one of the area’s most advanced warehouses.
Since there are so many transport options throughout the area, it’s easy for business owners to trade with the rest of the UAE or globally. It has some of the world’s fastest connections between Russia, Asia and Africa.
Types of Company Formations Allowed in JAFZA
When setting up a business in JAFZA, you have a few different options for company formation. The type you choose will depend on what type of business you will be conducting.
Free Zone Company (FZCO)
An FZCO is a formation type that’s very similar to a standard Limited Liability Partnership. In this business formation, the business owner’s personal assets are completely secured and the liabilities are limited to those of the company.
In JAFZA, business owners can have between 2 and 50 shareholders under an FZCO formation. These shareholders can be individuals or companies.
Free Zone Establishment (FZE)
For individuals who want to own a company without shareholders, an FZE is the way to go. These businesses only require one shareholder, meaning that a sole proprietor can own the company.
What’s interesting about FZE companies is that they can be owned either by another company or by an individual. It’s a great option for protecting your assets as the liability is limited to the company’s assets.
The simplest business formation type in JAFZA is a branch office. This business is an extension of a parent company and can be formed by companies located outside JAFZA.
In order to form a branch office in the Jebel Ali Free Zone, the company will have to completely own the branch and operate under the same name. It will also have to conduct operations of the same nature as the parent company.
Required Documentation for Registering a Business in JAFZA
There are a few documents that you’ll need to get in order to start a free zone business in JAFZA. These documents are relatively simple to acquire and to get started with for your company.
The first document you’ll need is an application form for operation in JAFZA. You’ll also need to fill out an environmental health and safety application.
In addition, you’ll be required to write a formal description of the company’s intended activities. And, you’ll have to send a copy of the company’s articles of association along with your business applications.
Remember, any managers, secretaries, and shareholders will need to submit copies of their passports. Keep this in mind if you have multiple higher-ups in your company.
How Much Does a Business License in JAFZA Cost?
Starting a business in JAFZA requires you to pay a few fees. The good news is that these fees are a bit lower than they are in other free zones throughout the UAE.
To register a business in JAFZA, you’ll need to pay a AED 10,000 registration fee. In addition to this base fee, you’ll need to pay the cost of your license. Type 1 license costs AED 5,500 and Type 2 license costs AED 9,000.
Remember, you’re also required to have office space within the free zone. You’ll need to factor in the cost of rent for your office when budgeting for business setup in JAFZA.
Finally, starting a business in JAFZA requires you to have a visa. There are several fees associated with getting your visa approved that should also be factored into the cost of setting up a company in this free zone.
How to Set Up a Business in JAFZA
Starting a business in JAFZA is a relatively straightforward process with minimal steps. You can initiate the process from outside the country but will need to visit the free zone after your company documents have been issued.
The first step to opening a free zone company is to choose a business name and decide on a business activity. You will then submit this information to the appropriate authority in order to obtain your licence.
Once you have received initial approval from the authority, you’re ready to submit your documents and pay associated fees. At this stage in the process, you should acquire office space.
Depending on the business type and activity you select, you can expect your JAFZA registration process to take between two and four weeks. You are able to get your business up and running within 10 days of approval.
You will need to renew your business licence every three years in order to continue operations. However, the renewal process can be done from outside of the UAE.
How to Cancel a Business License in JAFZA
If you decide you want to close your operations in JAFZA, you’ll need to go to the UAE in person. Or, you can leave the cancellation process up to a designated individual with Power of Attorney.
In order to cancel your business, you’ll need to return the original company documents. You’ll also have to pay a license cancellation fee, which usually costs around AED 2,000.
It typically takes about one month to complete the liquidation process. Once you complete the process, the JAFZA company register will issue a certificate proving that the company is no longer in operation.
Launch a Company in JAFZA
JAFZA offers business owners numerous opportunities and is an amazing place to generate revenue and grow a successful company. It’s a place where many UAE business owners are flocking to in order to take advantage of the numerous benefits in the area.
If you’re ready to start a business in JAFZA or any other free zone in Dubai, we can help. Get in touch with our team to launch a business in the UAE today.
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