At a Glance — UAE Free Zone Trading Company
| Feature | Detail |
|---|---|
| Typical First-Year Cost | AED 10,500 – AED 30,000+ (licence + establishment card + visa) |
| Licence Types | Trading, General Trading, Specific Commodity Trading |
| Company Structures | FZE (sole shareholder), FZC (2+ shareholders), Branch |
| Visa Eligibility | Typically 1–6 visas depending on free zone and office type |
| Office Requirement | Flexi-desk (most FZs) or dedicated unit (JAFZA, some others) |
| UAE Market Sales | Via a local distributor/agent or by paying applicable customs duty |
| Corporate Tax | 0% on qualifying income (subject to Qualifying Free Zone Person rules) |
| Typical Setup Time | 3–7 working days (licence); bank account +2–8 weeks |
| Popular Free Zones | JAFZA, IFZA, DMCC, RAKEZ, Ajman FZ, DAFZA, SAIFZ |
What Activities Can a Free Zone Trading Company Conduct?
A UAE free zone trading licence covers import, export, re-export, storage, and distribution of goods. Common permitted activities include:
- General trading (broad range of commodities — confirm with the specific free zone)
- Import and re-export of consumer goods, electronics, machinery, textiles
- Commodity trading (metals, food products, chemicals — subject to commodity-specific approvals)
- Wholesale distribution to GCC markets
- E-commerce sales and cross-border fulfilment
- Cold-chain and perishable goods (JAFZA, Dubai South and selected logistics FZs)
Note: Certain commodities (pharmaceuticals, controlled substances, weapons, food products) require additional regulatory approvals beyond the free zone licence. Always verify permitted activities with the relevant authority before applying.
Suitable Free Zones for a Trading Company
| Free Zone | Best Suited For | Indicative Cost (Yr 1) |
|---|---|---|
| JAFZA (Jebel Ali) | Heavy/bulk goods, port access, large-volume importers | AED 30,000–60,000+ |
| IFZA (Dubai Silicon Oasis) | Cost-efficient general trading, SMEs | AED 12,900–20,000 |
| DMCC (JLT) | Commodities, precious metals, F&B, crypto trading | AED 18,000–35,000 |
| RAKEZ | Manufacturing+trading combos, warehouse/industrial | AED 15,000–30,000 |
| Ajman Free Zone | Budget trading licences, GCC distribution | AED 10,500–18,000 |
| SAIFZ (Sharjah Airport) | Air freight, time-sensitive cargo, logistics-linked trading | AED 13,000–22,000 |
| DAFZA (Dubai Airport) | Air cargo, electronics, high-value goods | AED 20,000–45,000 |
All costs are indicative only. Actual fees vary by licence type, visa quota, office type, and current authority pricing. Request a current written quote before committing.
Company Structures
Free zone trading companies typically choose from:
- FZE (Free Zone Establishment) — sole shareholder; most common for individual founders
- FZC (Free Zone Company) — 2 or more shareholders; suits partnerships and corporate shareholders
- Branch of a Foreign Company — extends an existing foreign entity into the UAE; parent company remains liable
Step-by-Step Setup Process
- Choose a free zone — match to your commodity type, visa needs, and budget
- Select your activities — confirm your specific trading activities are permitted
- Reserve a trade name — check availability and submit name reservation
- Submit application & documents — passport copies, business plan (some FZs), NOC (if applicable)
- Pay licence + establishment fees — first-year licence, registration, and establishment card
- Sign office/flexi-desk agreement — required before licence issuance at most FZs
- Receive trade licence — typically 3–7 working days from document acceptance
- Apply for visas — investor/employee visas; Establishment Card required first
- Open a corporate bank account — allow 2–8 weeks; prepare audited accounts/business plan
- Register for VAT — mandatory if annual turnover exceeds AED 375,000
Required Documents
- Passport copies of all shareholders and managers
- Recent passport-sized photographs
- Current UAE residence visa copy (if applicable)
- Business plan (required by some free zones)
- NOC letter from current UAE employer (if currently employed in UAE)
- For corporate shareholders: certificate of incorporation, board resolution, memorandum of association
Indicative Cost Breakdown
| Cost Component | Typical Range (AED) |
|---|---|
| Trade licence fee | 5,000 – 15,000 |
| Establishment card / registration | 1,200 – 3,500 |
| Flexi-desk / office lease (1 yr) | 3,000 – 12,000 |
| Investor visa (per person) | 3,500 – 6,500 |
| Emirates ID | 370 – 570 |
| Medical + insurance (visa) | 600 – 1,500 |
Costs are indicative. Government fees change periodically. Request a current written quote from the free zone or a registered agent.
Renewal Costs
Annual licence renewals typically cost 60–80% of the first-year licence fee (registration charges do not repeat). Renewal is usually required 30–60 days before expiry. Late renewal incurs a penalty fee, typically AED 500–1,000 per month.
Banking & Tax Notes
Corporate bank account opening for trading companies typically takes 2–8 weeks. Banks require a business plan, proof of trading contracts or purchase orders, and sometimes 6 months of bank statements from the parent/personal account. Under UAE Corporate Tax (effective June 2023), free zone companies may qualify for 0% on qualifying income if they meet the Qualifying Free Zone Person (QFZP) criteria. Non-qualifying income is taxed at 9%. Consult a registered tax agent for advice specific to your business.
Frequently Asked Questions
Can a UAE free zone trading company sell to UAE mainland customers?
Yes, but goods entering the UAE mainland from a free zone are treated as imports and attract customs duty (typically 5% for most goods, higher for some categories). You may appoint a mainland distributor or agent, or pay the applicable customs duty to sell directly to UAE end-customers.
What is the difference between a trading licence and a general trading licence?
A trading licence covers a specific list of approved commodities. A general trading licence allows a broader range of commodities under one licence, which can be more flexible but may cost more and require additional approvals at certain free zones.
Do I need a physical office for a free zone trading company?
Most free zones allow a flexi-desk arrangement (shared desk/address) for 1–2 visas. Larger visa quotas or certain activities (warehousing, heavy commodities) typically require a dedicated unit or warehouse. JAFZA and some others require physical premises regardless of size.
How long does it take to set up a trading company in a UAE free zone?
Licence issuance typically takes 3–7 working days after all documents are submitted and approved. Visa processing adds 2–4 weeks, and bank account opening adds 2–8 weeks. Total timeline from application to fully operational is typically 6–12 weeks.
What are the annual renewal requirements for a free zone trading company?
You must renew the trade licence annually, renew the office agreement/flexi-desk, and renew employee and investor visas every 2–3 years. Some free zones also require annual financial statements or audit reports after the first year of operations.
Disclaimer: Information on this page is for general guidance only and is accurate to the best of our knowledge as of June 2026. UAE free zone regulations, fees, and procedures change periodically. Always verify current requirements and costs directly with the relevant free zone authority or a registered business setup consultant before making any decisions. Request a free consultation for personalised advice.