DED outlines terms for UAE Free Zone companies to do business in Dubai

Al Saadi issued the clarification after reports in certain online media and subsequent enquiries on a Free Zone company in another emirate claiming to be a “virtual free zone” providing cheaper means of enabling “international entrepreneurs operate their businesses from a home or office anywhere in the UAE.”

“Recently, we have been receiving complaints from various Free Zone companies, most of them operating outside Dubai, that their licensors had promised they can do business in Dubai under the Free Zone license. We have clarified to them that there is an established route to doing business in Dubai,” Al Saadi explained.

“Through Law No.13 of 2011, Dubai has acknowledged the role of Free Zone companies in economic activity in the UAE and the leadership wants to allow such companies to contribute further to overall development. DED's role is to enable businesses that choose Dubai as their base to benefit from a competitive environment and best practices,” Al Saadi added.

A Free Zone company can operate a branch in Dubai as long as it is active within the Free Zone but any termination of the Free Zone activity will reflect in the Dubai license as well.

The Law No. 13 also allows Free Zone companies that have no local partners to open branches in Dubai, provided such branch has a Local Service Agent on board. A Local Service Agent is a UAE national or UAE company who will sponsor employees for the Dubai branch of a Free Zone company at the Ministry of Labour. The Local Service agent will have no rights of voting or decision-making in the company.

For original article visit: http://www.albawaba.com/business/pr/ded-free-zone-companies-451543/