Jebel Ali is a large commercial port and business hub on the southern outskirts of Dubai, in the United Arab Emirates (UAE), and is only about an hour’s drive from the UAE’s capital city, Abu Dhabi.
The Jebel Ali Free Zone (JAFZA) is the largest customs bonded zone in the Middle East and is connected to Jebel Ali Port, the Middle East’s largest container port with an annual capacity of more than nine million standard 20-foot equivalent units (TEUs). Al Maktoum International Airport, also known as Dubai World Central, has been constructed just outside the port area.
When fully completed, the airport will have a projected annual capacity of 12 million tonnes of freight and between 160 million and 260 million passengers. Emirates Airline plans to use the airport as its only hub once the first expansion is complete.
Established in 1985, JAFZA has grown from the UAE’s first free zone with 19 companies to a vast ecosystem of industries including logistics, e-commerce, petrochemicals and automotive. This growth has aligned with that of its parent company DP World, the port and logistics multinational company owned by the government of Dubai. Currently more than 10,000 companies have a presence in JAFZA.
JAFZA infrastructure and facilities offer modern office spaces and industrial units to advanced logistics facilities and warehousing solutions. JAFZA provides the infrastructure required to support businesses of all sizes and industries. Many tenants use JAFZA as a base from which to export, making it critical to Dubai’s leading position as a regional trade and logistics hub. More than 20% of the foreign investment and over 50% of total exports from Dubai are from JAFZA.
In 2003, the Jebel Ali Free Zone Authority (JAFZA), in collaboration with the Dubai government, introduced the Offshore Company, which is regulated under the Jebel Ali Free Zone Offshore Companies Regulations 2003. JAFZA is the most well-known of the UAE’s free zones and the most popular UAE offshore jurisdiction.
Offshore Companies are primarily used for:
- International trade
- Formation of holding companies
- Owning real estate
- Registration of copyrights and patents
- International consulting services
Additionally, JAFZA free zone companies get access to world-class amenities in healthcare, education, and recreational facilities, ensuring a high quality of life for residents and employees.
Policies and Incentives of the Jebel Ali Free Zone (JAFZA)
- 100% Foreign Ownership Allowed
With no foreign ownership restrictions, JAFZA is the perfect choice for international investors looking to establish their companies in the region. Businesses within the free zone operate under the independent authority of the free zone that issues operating licences and regulates the activities of all enterprises within the zone.
- Local Real Estate Ownership
JAFZA Offshore Companies are the only type of offshore company that are permitted to act as holding companies for Dubai real estate. Prior approval is required from the JAFZA authority and the developer. Sovereign can assist with this process.
- Local Banking
JAFZA Offshore Companies can hold a bank account in the UAE for routine operational transactions and maintain professional relationships with legal consultants, accountants, management companies, and other similar entities conducting business within the UAE.
- Inspection
The Registrar is authorised to appoint inspectors to investigate the operations of a JAFZA Offshore Company. The company owner may be liable to pay any charges related to such an inspection.
- Can own shares in Local Companies
JAFZA Offshore Companies are generally prohibited from conducting business with UAE residents, but they are often permitted to hold shares in both offshore and onshore UAE companies.
Characteristics of an Offshore Company registered in JAFZA include the following:
Type of licences
The JAFZA Free Zone offers a range of licences tailored to suit various business activities. These licences are categorised into three main types:
- Trading Activities
A Trading or General Trading Licence is required and will permit the import, export, or sale of specified goods listed on the certificate.
- Service Activities
Businesses solely providing services must obtain a Service Licence which covers a wide range of service-oriented activities under one licence.
- Industrial Activities
An Industrial Licence allows for manufacturing-related activities which include import, export, processing and logistics.
Other specialised licences available in JAFZA include:
- General Trading Licence – for a broader range of trading practices and goods.
- Logistics Licence – services such as storage, delivery, forwarding, inventory control and transportation.
- E-Commerce Licence – allows for online buying and selling within Jebel Ali Free Zone.
The estimated time to have the company set up completed is between three to 14 business days from the time all required documents are submitted based on the company formation type, licence and categories of business within the licence. It is also essential to have a lease agreement in place at the time of the set-up of the company.
Sovereign PPG is a registered agent in JAFZA and can assists businesses with their set-up and expansion in this well-known free zone. With expertise in company formation, licensing and liaison with JAFZA Registrar regarding business activities, staff and dependant visas, we can help organisations navigate the set-up process in JAFZA, ensuring a smooth and efficient entry into one of the world’s leading free zones for trade and industry.
We also provide clients with post-incorporation services to keep their JAFZA company in compliance with all regulations. For assistance, contact Dubai@SovereignGroup.com or fill in the form and we would be delighted to assist you.
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