JEBEL ALI FREE ZONE AUTHORITY (JAFZA) COMPANY

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A HIGHLIGHT OF JEBEL ALI FREE ZONE (ONSHORE) COMPANY

Jafza - Jebel Ali Free Zone CompanyJebel Ali is a port town, located 35 kilometers southwest of Dubai, in the United Arab Emirates. JAFZA (the Jebel Ali Free Zone Authority) that was established in the year 1985 is the Economic Zones World’s flagship operation and is also one of the world’s largest and fastest growing free zones.

JAFZA currently has over 6400 companies, including over 120 of the Fortune Global 500 enterprises, from across the world.

As the leading business hub of the Middle East, JAFZA focuses on long-term customer relationships and foster alliances with global investors by providing them with world class infrastructure supported with value-added services and incentives. JAFZA also offers the benefit of huge business opportunities from a potential market of over two billion people in the greater Middle East region.

Their products include office units, warehouses, light industrial units and land on long term lease. These land sites are suitable for a variety of purpose-built facilities. Other value added products include business centers, hotels for visitors and customized Build-to-Suit options.

LICENSE TYPES

General Trading: allows the holder to import, distribute and store all items as per JAFZA rules and regulations.

Trading: allows the holder to import, export, distribute and store items specified on the license.

Industrial: allows the holder to import raw materials, carry out the manufacture of specified products and export the finished product to any country.

Service: allows the holder to carry out the services specified in the license within the Free Zone. The type of service must conform to the parent company’s license, issued by the Economic Department or Municipality of the relevant Emirate in the UAE.

National Industrial: is designed for manufacturing companies with an ownership or shareholding of at least 51% with AGCC (Arabian Gulf Co-operation Council) nationals / citizens. The value added to the product in the Free Zone must amount to a minimum of 40%. This company license allows the holder the same status as a local or AGCC inside the UAE.

REGISTRATION FORMS

Free Zone Establishment (FZE) and Free Zone Company (FZCO): FZE and FZCO applicants can avail of Jafza’s unique offer of forming a company as a separate legal entity. A FZE formation can be with a single shareholder with a minimum capital of AED 1 million. An FZCO can be formed with 2 to 5 shareholders with a minimum capital of AED 500,000.

Branch Company: Companies having valid registration and license outside JAFZA can apply for the formation of a branch Company in JAFZA.

 

KEY BENEFITS

  • One hundred percent foreign ownership;
  • Repatriation of capital and profits;
  • Liberal labor laws;
  • Zero income tax;
  • Zero personal tax;
  • Zero corporate tax and VAT;
  • Zero foreign exchange controls;
  • Modern infrastructure, utilities and telecommunication facilities;
  • Investor’s or partner visa and/or employment visa;
  • Confidentiality as there is no public record.
 

JAFZA TAXES

The most important advantage for setting up a JAFZA onshore company is the fact that the free zone offers a guaranteed 50 year exemption from personal income and corporate taxes. This is an attractive tool for all investors.

 

JEBEL ALI FREE ZONE COMPANY CORPORATE AND LEGAL FEATURES

COMPANY NAME

Four preferred company names must be provided for approval. The authorities will always aim to reserve the first choice.

DIRECTOR

One individual Manager/director. The same person can act for both positions.

SHAREHOLDER

Minimum of one shareholder (corporate or individual is allowed) and maximum five.

SHARE CAPITAL

Minimum share capital of an FZE (single shareholder) needs to have a minimum capital of AED 1 million. Minimum share capital of a FZC (between 2-5 shareholders) needs to have a minimum capital of AED 500,000. Each share should be AED 100,000 therefore in case there are 5 shareholders (with equal percent of shares) one share will be allotted to each shareholder.

OFFICES

It is compulsory to rent an office in Jebel Ali, under a JAFZA company.

LICENSE

Licenses are issued for a period of one year and are renewable on an annual basis.

AUDIT

An annual financial audit must be conducted and submitted to the authority. While the standard reporting period is one calendar year, a company may nominate a different reporting period the first reporting period will commence from the date of incorporation and must not be less than six months and not more than eighteen months.

ACCOUNTS

Preparation of accounts is required but up to present there is no requirement for filing them.

 

VISA APPLICATIONS

The number of visas that a company is eligible to get is mainly dependent on the office size occupied by the company. Generally, one visa goes for 10 square meters and assessment process is done separately on a case by case basis. The assessment of the visa issuance is also dependent on the transactions carried out by the company. The issuance of visas normally takes 4-7 working days but this period is subject to immigration department’s approval.

 

IMPORTANT INFORMATION

  • Licenses are amended upon approvals after satisfying the required approvals and also paying the specified fees;
  • If you trade in UAE through a free zone company, there are two options available for you to use. First, you can directly trade with an LLC company that holds an import/export license. Secondly, you can enter into an agreement with a logistics company that will in turn clear the goods and deliver them up to the mainland;
  • For service companies that wish to carry out service provision to companies not in the free zone, the general rule states that the services should only be provided within the jurisdiction of the free zone;
  • The Customs duty paid for most goods is usually calculated on the CIF value of the goods at a 5% rate. Liquor/ alcohol imports are subjected to a duty of 50% of their CIF value while tobacco imports are subjected to 100% CIF value custom duty. Necessities staple foodstuffs and pharmaceutical products are exempted from customs as they are duty free;
  • Documents required by customs authorities are: goods declaration, certificate of origin, bill of lading and invoice copies. Due to the regular changes in customs, there may be other additional documents required. Refer to www.dubaicustoms.gov.ae to be updated on the changing nature of customs;
  • You are permitted to sell goods in the local market but this should be done through a distributor. A free zone company may not be able to retail its goods to the local market directly.