Business Setup in Jebel Ali Free Zone (JAFZA)

JAFZA stands for Jebel Ali Free Zone Authority. It is a free economic zone located in the Jebel Ali area of Dubai, United Arab Emirates. Established in 1985, JAFZA is one of the largest free zones in the world, spanning over 57 square kilometers and hosting more than 7,500 companies from over 135 countries.

JAFZA offers a range of facilities and services to companies looking to establish a business in the region, including office and warehouse space, business licenses, visa services, and more. Companies operating in JAFZA enjoy a number of benefits, including 100% foreign ownership, exemption from corporate and personal income taxes, and no restrictions on capital repatriation.

JAFZA is a key player in the economy of Dubai and the wider UAE, with a focus on attracting foreign investment and facilitating trade and commerce.

Types of companies in JAFZA

Jebel Ali Free Zone Authority (JAFZA) hosts a wide range of companies from various industries and sectors. Some of the key sectors represented in JAFZA include:

1. Manufacturing: JAFZA is home to a diverse range of manufacturing companies, including those involved in food and beverage production, pharmaceuticals, textiles, and construction materials.
2. Logistics and Distribution: Given its strategic location in the heart of the Middle East, JAFZA is a key logistics hub, with companies involved in freight forwarding, warehousing, and transportation.
3. Trading: JAFZA is a popular destination for trading companies, including those involved in electronics, automotive parts, and consumer goods.
4. Services: JAFZA also hosts a range of service-based companies, such as IT firms, consulting companies, and financial services providers.
5. Oil and Gas: JAFZA has a dedicated section for companies involved in the oil and gas industry, including drilling equipment manufacturers and service providers.
6. Aviation: JAFZA has a specialized aerospace zone, which includes companies involved in aircraft maintenance, repair, and overhaul (MRO), as well as logistics and distribution for the aviation industry.
7. Construction: JAFZA has a number of companies involved in construction, including those providing building materials, construction equipment, and engineering services.

Step By Step Process For Business Setup in JAFZA Free Zone:

Setting up a company in Jebel Ali Free Zone Authority (JAFZA) can be a great way to take advantage of the many benefits of operating in a free economic zone in Dubai. In this guide, we will provide a detailed overview of the steps involved in setting up a company in JAFZA, including the required documentation, fees, and timelines.

Step 1: Determine the Type of Company You Want to Establish

Before you begin the process of setting up a company in JAFZA, you will need to determine the type of company you want to establish. There are several options available, including:

1. Free Zone Establishment (FZE): An FZE is a limited liability company (LLC) with one shareholder. The shareholder can be an individual or a company, and there is no minimum capital requirement.
2. Free Zone Company (FZCO): An FZCO is a limited liability company with 2-5 shareholders. Shareholders can be individuals or companies, and there is no minimum capital requirement.
3. Branch Office: A branch office is a legal entity that is fully owned by a company established outside of the UAE. A branch office can only engage in activities that are the same as those of the parent company.
4. Representative Office: A representative office is a legal entity that is fully owned by a company established outside of the UAE. A representative office can only engage in activities such as marketing and promoting the parent company’s products and services.

Once you have determined the type of company you want to establish, you will need to gather the necessary documentation and begin the registration process.

Step 2: Gather the Required Documentation

In order to register your company in JAFZA, you will need to provide a number of documents. These typically include:

1. Business Plan: A detailed business plan outlining your company’s activities, objectives, and financial projections.
2. Passport Copy: A copy of the passport of the shareholder(s) and the appointed manager.
3. Proof of Address: A proof of address, such as a utility bill, for the shareholder(s) and the appointed manager.
4. No Objection Certificate (NOC): If the shareholder is a company, a no-objection certificate from the company’s sponsor is required.
5. Board Resolution: A board resolution approving the establishment of the company and appointing the company’s manager.
6. Memorandum and Articles of Association: The Memorandum and Articles of Association (MOA and AOA) of the company, which should include details such as the company name, activities, share capital, and shareholder details.
7. Financial Statements: Audited financial statements for the past two years (for FZCO and branch offices).
8. Bank Reference Letter: A bank reference letter from the shareholder(s)’ bank.
9. Lease Agreement: A lease agreement for the office or warehouse space where the company will operate.

Step 3: Submit the Application

Once you have gathered all the necessary documentation, you can submit your application to JAFZA. The application can be submitted online through the JAFZA portal or in person at the JAFZA office.

The application will need to include the following information:

1. Type of company you want to establish (FZE, FZCO, branch office, or representative office)
2. Proposed company name
3. Business activity
4. Share capital
5. Shareholder(s) and manager details
6. Office or warehouse space requirements
7. Estimated annual turnover

Step 4: Obtain the License

Once your application has been reviewed and approved, you will receive a provisional approval letter from JAFZA. You will then need to pay the required fees and obtain the necessary licenses before you can begin operating your company.

The fees associated with setting up a company in JAFZA vary depending on the type of company and the services required. Some of the common fees include:

1. License Fees: The license fees vary depending on the type of company and the business activity. The fees are typically paid annually.
2. Registration Fees: The registration fees for setting up a company in JAFZA range from AED 10,000 to AED 50,000 depending on the type of company.
3. Visa Fees: Visa fees vary depending on the type of visa required and the duration of stay.
4. Office or Warehouse Space Fees: The fees for renting office or warehouse space in JAFZA depend on the size and location of the space.

Once you have paid the required fees and obtained the necessary licenses, you can begin operating your company in JAFZA.

Step 5: Open a Bank Account

In order to operate your company in JAFZA, you will need to open a bank account in the UAE. This can be done at any of the major banks in the UAE, such as Emirates NBD, Dubai Islamic Bank, or Abu Dhabi Commercial Bank.

To open a bank account, you will need to provide the following documentation:

1. Valid passport and UAE residence visa for the account signatory and authorized signatories.
2. Original company documents, including the MOA, AOA, and certificate of incorporation.
3. Proof of address for the company and the account signatory, such as a utility bill.
4. Business plan and financial projections.

Once your bank account has been opened, you can begin operating your company in JAFZA.

Step 6: Comply with Regulatory Requirements

As a company operating in JAFZA, you will need to comply with various regulatory requirements. These include:

1. Renewal of Licenses: You will need to renew your company’s license annually to ensure that your business is operating legally.
2. VAT Registration: If your company’s annual turnover exceeds AED 375,000, you will need to register for Value Added Tax (VAT) with the Federal Tax Authority.
3. Compliance with Labor Laws: Your company will need to comply with the UAE’s labor laws, including providing employment contracts, paying salaries on time, and providing end-of-service benefits.
4. Compliance with Immigration Laws: Your company will need to comply with the UAE’s immigration laws, including ensuring that all employees have valid residence visas and work permits.

By complying with these regulatory requirements, you can ensure that your company operates legally and avoids any potential legal issues.

Cost of setting up business in JAFZA:

The cost of setting up a company in JAFZA varies depending on the type of company and the services required. Generally speaking, the cost can range from AED 20,000 to AED 50,000 or more. Here is a breakdown of the typical costs associated with setting up a company in JAFZA:

1. License Fees: The license fees vary depending on the type of company and the business activity. The fees are typically paid annually and can range from AED 1,500 to AED 50,000 or more.
2. Registration Fees: The registration fees for setting up a company in JAFZA range from AED 10,000 to AED 50,000 depending on the type of company.
3. Visa Fees: Visa fees vary depending on the type of visa required and the duration of stay. 
4. Office or Warehouse Space Fees: The fees for renting office or warehouse space in JAFZA depend on the size and location of the space. The rent can range from AED 30 to AED 100 per square foot per year.
5. Miscellaneous Fees: There may be additional fees for services such as company setup, legal services, and accounting services.

Setting up a company in JAFZA can be a great way to take advantage of the many benefits of operating in a free economic zone in Dubai. By following the steps outlined in this guide, you can ensure that your company is registered properly and can begin operating legally in JAFZA. As with any business venture, it is important to conduct thorough research and seek professional advice to ensure that you fully understand the process and requirements involved in setting up a company in JAFZA.