Dubai as an International Business Hub and the Incentives Provided To the Free Zone Companies by the Government

Dubai is one of the seven emirates of UAE. The emirate consists of a city of the same name. The city is the largest in terms of population among the rest of the cities of UAE and is the second largest city in terms of area after Abu Dhabi. The history of Dubai dates back to the era even before than the formation of United Arab Emirates. It was only a desert back then in which only tribal Bedouins living in the area could survive.

Gradually the population began to rise and thus the desert gained the shape of a city that is one of the largest cities in the world of modern times. Previously Dubai’s economy was dependent on oil trading business only. Then steps were taken by the government of Dubai to diversify the economy of Dubai. One of these steps was making Dubai an industrial and commercial hub in the region.

For this purpose, many different free zones were established all over the city. These free zones played quite an important role in the diversification of the economy of Dubai and in the creation of a business hub in the city. The companies that were operating in these zones were given special allowances and benefits that helped in flourishing their trades all across the city.

Dubai Freezone Company enjoys benefits such as better infrastructure, a wide range of facilities (warehouses, offices), relief from corporate tax, and zero import duties. One of the most important benefits that were available to the companies operating in the zone was that these companies could be 100% owned by foreign investors. There is a rule in Dubai for a company that the majority of the shares of the company are to be held by the local residents of Dubai. Since the free zone companies are excluded from this restriction therefore this has helped a lot in attracting foreign businesses to operate from these zones in the city.

There are number of Dubai free zones that have been established by the government. These include Jebel Ali Free Zone, Dubai Airport Free Zone, Hamriyah Free Zone and Dubai Internet City. Jebel Ali Free Zone is the first free zone in UAE that is located betwee
Jebel Ali Port and Jebel Ali Airport giving a boost to nearly six thousand companies as it provides a wide variety of facilities that includes entrepreneur’s assistance, finding potential business partners etc. Hamriyah Free Zone is setup in order to give boost to international trade as it contains a deepwater port and suitable infrastructure to support import and export.

The benefits here includes low annual license fee that attracts manufacturing companies and it also contains an special area for small and medium sized companies known as Hamriyah SME Zone, that provides different specialized facilities to SME’s such as E-office package. Dubai Internet City, another free zone that provides support to business in information technology and many renounced names has already got their places in this free zone such as Microsoft, IBM and Dell.