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New Business Reforms Three Free Zones Brought under One Authority

New Business Reforms: Three Free Zones in Dubai Brought under One Authority

Giving a new boost to the process of business setup in Dubai, the government has issued a new law integrating three premium free zone under a single authority. As a result, the ’Dubai Authority for Economic Zones’ (DIEZ) will now regulate the free zones such as Dubai Silicon Oasis, Dubai Airport Free Zone and Dubai CommerCity. The authority is expected to deliver better business setup services in Dubai for foreign investors, entrepreneurs and corporate groups.

As per the newly issued Law No. (16) of 2021, the DIEZ will have the status of an independent legal entity with financial and administrative autonomy. Although the government is yet to issue further details about the new authority, you can have some basic information about the features of DIEZ in this article. Read ahead.

The Structure of Dubai Authority for Economic Zones 

The DIEZ will be composed of more than 5,000 registered international companies encompassing 20 major economic sectors. The companies operating under the Authority employ 30,000 employees from all over the world. With three free zones coming under its purview, the DIEZ will be regulating economic activities that form 5% of Dubai’s GDP.

The DIEZ will develop new frameworks to enhance the business services delivered to investors, entrepreneurs, SMEs and other corporate groups. This will in turn lead to boost the economic growth of the emirate and improve the environment of business setup in Dubai.

Powers & Responsibilities of Authority 

The Authority will be in charge of creating, developing and overseeing the infrastructure and administrative services of Integrated Economic Zones. It will also regulate business activities and services in Integrated Economic Zones, including the import and storage of merchandise. The following are the other major powers likely to be vested with the authority:

  1. Issuing / renewing trade licenses
  2. Creating and amending implementing regulations for companies
  3. Deciding on business activities
  4. Providing business setup services
  5. Regulating liquidation of companies
  6. Overseeing the submission of annual audit reports of companies

Advantages of Being Licensed by the Authority 

As per the announcement made by the Dubai Media Office, companies licensed by the DIEZ will be entitled to the following benefits:

1. Tax Exemptions

Companies licensed by the new authority are not subjected to taxes, including income tax, for 50 years, starting from the date of issuance of the new change. The Dubai rule reserve the right to extend the exemption period for a similar period. Consult with business setup consultants in Dubai for any tax queries.

2. No Restriction on Repatriation of Capital

All subsidiaries of the Dubai Integrated Economic Zones Authority and companies or individuals licensed by the Authority are exempted from restrictions on repatriation of capital, profits and salaries in any currency and to any destination outside its Zones. This exemption is valid for 50 years. Furthermore, the funds of licensed companies and their employees will not be subject to nationalisation or restricted ownership.

3. No Interference of Govt Authorities

Unlike the mainland companies, companies regulated by the Integrated Economic Zones Authority and their activities are not subject to the regulations of Dubai Municipality of Dubai Economy. However, the regulations of these government departments will apply in the case of activities related to safety, security and food control, or any other regulations designated as applicable within Free Zones.

Rationale Behind the Move 

The new Authority was formed as part of the government’s strategic initiatives to expedite the pace and efficiency of services for businesses and improve the ease of doing business in Dubai. The key objective of the Authority is to attract local and international companies to set up their headquarters in Integrated Economic Zones in the emirate. The authority also aims to support SMEs and drive entrepreneurship and innovation across sectors.

How Jitendra Business Consultants can help  

DAFZA, DSO and Dubai CommerCity are among the premium free zones in Dubai with a track record of generating impressive revenues. The integration of these three zones under a single Authority is likely to streamline the process of business setup in Dubai. Investors who wish to set up a business in DIEZ can consult with the best business setup consultants in Dubai such as Jitendra Business Consultants (JBC).

JBC provides the best business setup services in Dubai such as determining the company structure, selecting the activities, obtaining a trade license, PRO services, and compliance services like Economic Substance Regulations (ESR), Ultimate Beneficial Ownership (UBO) etc. If you’re an investor or entrepreneur planning to enter the lucrative UAE market, get in touch with our highly qualified business setup consultants in Dubai.

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