UAE free-zone company formation

Start with the business you intend to operate

A regional consultancy, a trading company and a holding structure can have quite different requirements. Hyam El Hachem Law Firm offers business establishment consultations and legal support on corporate arrangements and commercial agreements. The first step is to understand the proposed activity, the people involved and where the business will operate.

UAE government guidance distinguishes the choice of activity, free zone and legal entity. The forms of company available depend on the relevant authority. A familiar location or an attractive formation package should therefore be considered alongside your actual operating needs.

Free zone, mainland or offshore?

Identify whether the company will employ people, occupy premises, deliver services, distribute products or principally hold investments. This helps frame a comparison of an operating company with a holding vehicle.

A free zone licence does not give unrestricted access to the UAE mainland market. The required permissions depend on the activities and applicable arrangements. Offshore structures require a separate assessment; the label alone does not establish a right to trade locally.

• Where will customers, staff and management be based?
• Will you need premises, regulated approvals or access to a particular market?
• Who will own shares, make decisions and sign contracts?
• Are you creating a new venture or transferring an existing business?

Clarify the relationships behind the company

The legal discussion can address shareholder roles, decision-making, transfers of interests, commercial terms and a process for resolving disagreements. For a joint venture or family-owned business, record how capital, responsibilities and future changes are to be handled.

Prepare any proposed shareholder agreement, distribution arrangement, service contract or lease. The scope of drafting, review and coordination with other advisers can then be agreed before work begins.

Plan beyond the incorporation date

Free zone incorporation does not automatically make all income tax-free. The Federal Tax Authority distinguishes qualifying income and the conditions applicable to a Qualifying Free Zone Person. Tax treatment should be reviewed with an appropriately qualified tax adviser.

Ask for a clear account of recurring obligations, renewals and the work covered by each provider. Banking and any immigration applications require their own assessment; incorporation does not guarantee approval.

Prepare your company formation consultation

Send a concise outline of your project and preferred consultation language. Avoid sending identity documents or sensitive financial records in the first message; the firm can identify what is needed after the initial discussion.

• Proposed activities, markets and expected operating model.
• Owners and existing companies, with the countries involved.
• A proposed free zone or formation quotation, if already selected.
• Existing contracts, planned premises and staffing requirements.
• Your timetable and the decisions on which you need legal advice.
• Consultations are available in English, French and Arabic, online or in Dubai by arrangement.