Company setup
Free zone company setup in the UAE
A free zone company is licensed by the authority of a designated economic zone instead of the emirate's economic department. Foreign investors can own it in full, and it trades inside its zone and internationally. It suits exporters, online businesses, consultants and holding structures. Selling directly on the mainland needs an extra arrangement.
At a glance Fact sheet
- Licensed by
- The authority of the free zone you choose
- Ownership
- Full foreign ownership is allowed
- Where it trades
- Inside its zone and internationally
- Mainland sales
- Through a mainland distributor, a mainland branch or an approved permit
- Corporate tax
- Registration required. 0% on qualifying income if the conditions are met
- Premises
- A desk, office, warehouse or plot inside the zone, depending on the zone
Overview
Each free zone in the UAE is a defined area with its own authority, its own company regulations and its own list of licensed activities. When you set up there, that authority registers the company, issues the licence and renews it each year. You deal with one body for most corporate matters, which is a large part of the appeal.
Free zones are built around sectors and locations. Some sit beside a seaport or an airport and serve trading and logistics companies. Others are office districts for technology, media or professional services. A few are designed for small service companies that need a licence, a desk and a visa or two. The right zone is the one that matches what you sell and where your customers are.
Caliph has formed more than 3,000 companies since 2020. In a free consultation your consultant compares the zones that license your activity, explains what each one asks for in office space and paperwork, and tells you plainly when a mainland licence would serve you better.
Pages in this section
Free zones in Dubai
Free zones in Abu Dhabi
Free zones in Sharjah
Free zones in Ajman
Free zones in Fujairah
Free zones in Ras Al Khaimah
How to choose a free zone
Match the activity first
Every zone publishes its own activity list. A zone that is ideal for commodity trading may not license software development or light manufacturing. Start from the exact activity, then shortlist.
Pick a location that serves the work
If you move goods, a zone near the port or the airport cuts handling and transport. If you meet clients, an office district with good transport links matters more.
Choose the office you will really use
Zones offer anything from a shared desk to private offices, warehouses and land. The space you take usually shapes the licence package and the number of visas you can apply for.
Count visas before you sign
Tell your consultant how many owners and employees need residence visas in the first two years. Allocation rules differ between zones and between office types.
Be honest about mainland sales
A free zone company cannot simply open a shop or invoice retail customers on the mainland. If most of your revenue will come from mainland buyers, compare a mainland licence before you commit.
Ask what your bank and clients expect
Some banks, customers and tender committees look at where a company is registered and whether it has a real office. Check before you choose the lightest package.
What to have ready
- Passport copies for every shareholder and the manager
- Your UAE residence visa and Emirates ID, if you already live here
- Two or three trade name options
- A short description of the business and the activities you want on the licence
- Proof of your home address, such as a recent utility bill or bank statement
- For a corporate shareholder: its licence or certificate of incorporation, constitutional documents and a board resolution
Each zone has its own checklist, and some ask for a business plan or attested company papers. Your Caliph consultant confirms what applies to you.
How free zone setup works
Free consultation
You describe the business, your customers and the visas you need. Your consultant notes anything that could rule a zone in or out.
Zone and package shortlist
We compare the zones that license your activity and show you the office and visa options in each.
Name and activity approval
The trade name and activities go to the zone authority for approval, together with the shareholder details.
Application and signatures
Caliph prepares the registration file. You sign the company documents, in many zones electronically.
Desk or lease agreement
The agreement for your desk, office or warehouse is signed, since the licence is tied to premises in the zone.
Licence issued
The authority registers the company and issues the licence and the company documents.
Visas, bank and tax
We open the establishment card, apply for residence visas, prepare the bank file and register the company for corporate tax.
Good to know
- Free zone companies are within the scope of UAE corporate tax and must register and file. The 0% rate on qualifying income applies only to a company that meets the conditions of a qualifying free zone person.
- Goods stored in a free zone for re-export are not charged customs duty. Goods that move from the zone into the mainland market are subject to UAE customs duty.
- In Dubai, Executive Council Resolution No. 11 of 2025 regulates how free zone establishments carry out activities outside their zone. Ask your consultant whether your zone and activity can use it.
Questions people ask
What is a free zone company in the UAE?
It is a company registered and licensed by the authority of a free zone, a defined area with its own company rules. It can be owned in full by foreign investors, it operates from premises or a desk inside the zone, and it trades within the zone and with other countries.
Can a free zone company do business on the mainland?
Not directly in most cases. To sell to mainland customers a free zone company works through a licensed mainland distributor, opens a mainland branch or company, or obtains the mainland licence or approval that applies. Dubai issued a resolution in 2025 that regulates this for its free zones. Your consultant checks which route fits.
Can a foreigner own 100% of a free zone company?
Yes. Full foreign ownership is one of the main reasons founders choose a free zone. You do not need a local partner or sponsor. The zone authority still reviews every shareholder, so expect to provide passport copies and, in some zones, proof of address and background details.
Do free zone companies pay corporate tax?
Free zone companies are within the scope of UAE corporate tax and must register and file returns. A company that meets the conditions to be a qualifying free zone person can benefit from a 0% rate on its qualifying income. The conditions are specific, so have your position reviewed before you rely on it.
Do I need a physical office in a free zone?
It depends on the zone and the package. Some zones accept a shared desk or a virtual workplace for small service companies. Others require a leased office, warehouse or plot before the licence is complete. The space you take usually affects how many residence visas you can apply for.
Can a free zone company sponsor residence visas?
Yes. A free zone company can sponsor residence visas for its owners and employees through the zone, within the allocation attached to its licence and office. If you plan to hire staff or bring family soon, tell your consultant so the package is sized correctly from the start.
- UAE Government portal: running a business in a free zone
- Ministry of Economy and Tourism: establishing business in free zones
- Ministry of Finance: corporate tax
Reviewed by Caliph Business Solutions on . Rules differ by activity and by authority. Your Caliph consultant confirms what applies to you.
Ready to establish your company in the UAE?
Book a free consultation. Tell us what you want to open and we come back with the route, the documents and the cost.
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