UAE Free Zones Are Moving In The Right Direction To Attract More Businesses.
The UAE has witnessed a significant down turn at the beginning of the financial crisis which resulted in less new requests for the implementation of business projects in the UAE from international investors. However, these days the demand has picked up again. Competition among free zones in the UAE is now becoming more agressive. While Dubai free zones largely still hold on to their high-price strategy models, Northern Emirates Free Zones are now coming up with a number of strategies and ideas to be more attractive for new clients. By comparisson with Dubai, setting up in a Northern Emirates Free Zone means a 50 – 70% cost saving. It is now becoming increasingly the norm that free zone no longer ask for share capital (except Dubai and Abu Dhabi).

Dubai Silicon Oasis
Silicon Oasis Free Zone Authority (DSOA) is now offering their office space at reduced and more reasonable rates including one month rent for free. Originally designed to become the Middle East’s “Silicon Valley” in an attempt to attract the semiconductor industry, they have realized that the current demand is the only important factor in business and have widened the scope of activities allowed within their boundaries. They are now offering all sorts of commercial and service licenses. Very recently DSOA has announced that they have reduced the minimum capital requirement for new companies setting up within their jurisdiction. Whilst the requirement used to be AED 1,000,000/- for Free Zone Establishments and AED 500,000/- for Free Zone Companies respectively, it is now AED 100,000/- for both.

Hamriyah Free Zone
The Hamriyah Free Zone Authority (Sharjah) has gone one step further and fully abandoned the minimum capital requirement for new companies. A new company established in Hamriyah Free Zone can announce the total amount of the company set up fees payable to the Free Zone Authority as the start up capital. In this case the company is no longer required to submit a capital letter from a bank to the Free Zone in order to receive the company license. This move makes the setting up procedure considerably faster as the opening of a bank account is not a requirement for the set up anymore. On the other hand the licensed company can open a bank account immediately with no need to wait for further formalization of its license. Competitive rates and set up packages along with a wide range of allowed activities have made Hamriyah Free Zone quite popular.

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