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Incorporation of a limited liability company in Fujairah Creative City Free Zone. Service offer

The new Fujairah Creative City Free Zone was founded in 2007 and is primarily oriented towards formation of service and media companies. The emirate of Fujairah is located on the coast of the Gulf of Oman in the Indian Ocean 150 kilometers from Dubai. Its own international airport and one of the largest ports in the UAE facilitated dynamic development of the emirate and enabled creation of optimal conditions to attract investors from around the world.
Fujairah Creative City offers a wide variety of options as to kinds of licenses for companies and visa packages for companies’ employees.

Main advantages of doing business in the UAE:

  • No profit tax;
  • Stable banking system, high possibility of opening an account with banks of the UAE;
  • Possibility to work with US dollars;
  • Quick company incorporation;
  • Possibility to create substance in the country of incorporation;
  • Possibility to obtain a resident visa for company’s shareholders and employees.

Budget for the creation of business in FCCFZ

Service
Cost (USD)
Incorporation of a company in FCCFZ, including a license for 1 activity, flexi-desk office lease, stamp, company incorporation services, e-channel registration[1]. A refundable e-channel deposit of 5,000 dirhams (approximately 1,370 USD) is also included in the cost[2]. The cost of services is stated for the sole shareholder and possibility to obtain 2 resident visas
11,900
Obtaining a resident visa (expenses when obtaining 1 visa*), including: - payment of all government fees (Entry Permit, Medical & Emirates ID, Visa Stamping); - services for the execution and submission of applications and necessary documents; - support services (a trip to the clinic and migration service). *In the case of obtaining 2 or more visas, please ask your consultant for the exact cost
4,200
Opening an account with a local bank
2,500
Total:
18,600 USD

COMPANY INCORPORATION

Fujairah Creative City Free Zone was founded in 2007 and offers incorporation of companies for a quite wide range of commercial activities, from consulting to media content creation.

The procedure of incorporation of a company in FCCFZ:

1) The following has to be determined:

  • name of the company to be checked for uniqueness (at least two options): it must not be identical or similar to the name of an existing company; characters of the Latin alphabet may be used; the name of the company must not contravene the public order of the UAE;
  • structure of the company (directors, members);
  • kind of license.

A company may obtain licenses of the following categories – Broadcasting, Media and Marketing, Publishing, Event Management, Media Support Services, New Media Services, Consultancy, Business Information, Production, Music & Entertainment, Information Technology, Design, Education. Some licenses, for instance, broadcasting licenses, require consent of the relevant regulator.

2) Payment for services

3) The following directors’/shareholders’/attorneys’ documents

have to be provided (originals or notarized copies):

  • passport;
  • document confirming the address (if it is not stated in the passport);
  • resume;
  • scanned copy of a 3.5 х 4.5 photo with a white background.

The shareholders will have to sign a client’s questionnaire form in order to undergo the compliance procedure as well as a service contract.

4) Preparation and submission of a set of documents for the incorporation of a company:

The following documents are prepared for the submission to the registration authority:

  • Company incorporation and license application (signed by shareholder);
  • Articles of association (signed by shareholder);
  • Description of the company’s business (signed by shareholder);
  • Color copies of passports of shareholder and director;
  • Specimen signature card (signed by director and shareholder);
  • Security approval form (filled in and signed by each director and shareholder);
  • Terms & Conditions signed by shareholder/director;
  • Power of attorney (not submitted if one person acts as director and sole shareholder).
IMPORTANT: the articles of association and company incorporation application must be signed by shareholder(s) while personally visiting the administration of Fujairah Creative City or its representative office in Dubai.

Before the incorporation of a company the administration of the free zone checks the company’s shareholders and directors based on the provided security approval form; additional documents may be requested at this stage, for example, a no criminal record certificate. Such a check takes 2 to 4 workdays.

After the check is done, company incorporation takes place, which takes 2 to 3 workdays.

Upon completion of the incorporation the administration of the free zone issues the following documents:

  • Certificate of incorporation containing the registration number and date, kind of license, information on the shareholder and share capital of the company;
  • License for the proposed activity of the company (license is issued for 1, 2 or 3 years);
  • Office lease contract;
  • Articles of association;
  • Power of attorney (not executed if one person acts as director and sole shareholder);
  • Share certificates.

The company seal is also handed over.

After the company has been incorporated one can proceed to obtaining visas and opening an account with a bank. A settlement account for the company may be opened with a UAE bank or with a foreign bank – for further information contact your consultant at GSL.

As the UAE is not a signatory to the Hague Convention of 5 October 1961 that abolished the requirement to legalize foreign official documents and does not apostille documents, in order to use documents of a local company in another country it is necessary to submit such documents for legalization to the consulate of that country.

In total, the incorporation of a company in Fujairah Creative City in average takes 10 days.

Obtaining a visa

In the UAE there is no such thing as residence permit. The migration rules of the UAE imply issue of resident visas, which are practically an analogue to a residence permit.

A resident visa is issued based on employment at a company (Employment Visa).

The number of resident visas depends on the business package chosen at the incorporation of the company.

A visa is valid for up to 3 years. Upon expiration a visa may be renewed for the same period.

The procedure of obtaining resident visas is as follows (one may start obtaining a visa only after the company has been incorporated):

1. Obtaining an Establishment Card (opening the migration file of the company) – 10 days.

This document is necessary to enable the company to apply for resident visas in the future.

2. Submission of documents for a resident visa and obtaining an Entry Permit – 1-2 weeks.

To obtain a resident visa it is necessary to enter the UAE on an Entry Permit.

3. Visiting the UAE to obtain a resident visa – in most cases a visa may be obtained within 5 workdays.

The applicant must:

  • undergo medical examinations (blood test and fluorography);
  • give biometric data (retina scan and fingerprints).

Once the passport with a resident visa in it is received the country may be left.

4. Obtaining a resident’s Emirates ID.

The card is issued a few days after the issue of the visa. Personal presence is not required to receive it.

IMPORTANT: Permanent residency in the UAE is not required; however, a resident visa will be cancelled in the case of absence from the UAE for over 6 months.

The cost of obtaining a resident visa in Fujairah Creative City starts at 4,200 USD. For further information on the procedure of obtaining it contact your consultant.

STRUCTURE

In Fujairah Creative City companies of two types may be established:

FZE – Free zone establishment, a limited liability company with one shareholder;

FZ LLC – Free zone company, a limited liability company with two (or more) shareholders.

In this free zone it is also possible to register branches of local and foreign companies as well as subsidiaries (of foreign legal entities).

Directors

Only an individual may be a director (manager); the minimum number of directors is 1. Directors must obtain a UAE resident visa. Information on directors is filed with the administration of the free zone but is not available to third persons.

Secretary

Only an individual may be a secretary. It may be the same person as a director. If when applying for company incorporation secretary is not specified, the first named director will be presumed to be secretary.

Information on secretary is not publicly available.

Members

The minimum number of a company’s members/shareholders is 1; individuals and legal entities are allowed; no requirements are imposed regarding residency. In Fujairah Creative City there is no requirement for a company to have a local shareholder.

If a shareholder is an individual, such individual must be over 21 years of age.

Authorized capital

In Fujairah Creative City there is no requirement regarding the minimum share capital.

Registered office

At incorporation an office lease contract is necessarily entered into between the company and the administration of the free zone. The address of such office is considered the official registered address of the company. The company also has the right to take on lease additional office, production or warehouse premises in the territory of the free zone. In Fujairah Creative City there is no requirement.

Our specialists are ready to assist in the selection of an office or other premises in the territory of the free zone at your request.

SUBSEQUENT WORK WITH A COMPANY

A company must annually renew its license, by paying the relevant fee, and lease contract.

Profit tax

Companies incorporated in free zones of the UAE are exempt from profit tax, capital gains tax, property tax and other taxes, except VAT.

VAT

Value added tax was introduced in the UAE on 1 January 2018.

VAT, as a general consumption tax, applies to all transactions with goods and services unless such transaction is exempt or taxed at the rate of 0%.

The standard VAT rate in the UAE is 5%.

There is no obligation to register for VAT purposes while the turnover in the territory of the country is below the registration threshold, which in the UAE is 375,000 AED (~100,000 USD).

Registering as a VAT payer is compulsory in the following cases:

  • there is reason to believe that during the following 30 days taxable turnover will exceed the registration threshold (for example, a contract is entered into);
  • at the end of the month taxable turnover for the preceding 12 months actually exceeded the registration threshold;
  • the company receives services that are subject to inclusion in accounts under the reverse charge and that are worth over the registration threshold.

Voluntary registration is also possible after the taxable transactions threshold of 187,500 AED (~ 50,000 USD) has been exceeded.

Registration with the Federal Tax Authority of the UAE and obtaining a Tax Reference Number (TRN) at least take 20 workdays.

After the registration with the Federal Tax Authority and obtaining a VAT payer number, a company must quarterly (and if its annual turnover exceeds 150,000,000 AED ~ 40,830,900 USD, then monthly) prepare and file a VAT return, and pay arising VAT within 28 days after the end of the VAT period.

Before incorporating a company we recommend receiving consultation from a specialist of the non-resident audit department and tax consultant to determine tax burden of the company and discuss issues of further administration of the company

Audit and accounts

Every company incorporated in Fujairah Creative City must keep accounting records sufficient to confirm its financial position and containing up-to-date information on the assets and liabilities of the company.

A company’s financial statements must be prepared annually, but there is no requirement to undergo audit and file accounts with state authorities.

In order to determine tax burden of a company we recommend consulting a tax consultant (we can arrange it on request)

Cost of services[3]

Service
Cost (USD)
Incorporation of a company in FCCFZ, including a service license, flexi-desk office lease, stamp, company incorporation services and e-channel registration. A refundable e-channel deposit of 5,000 dirhams (about 1,370 USD) is also included in the cost[4]. The cost of services is stated for the sole shareholder and possibility to obtain 2 resident visas. Other options are available on request.
11,900
Annual renewal of a company, including a service license, flexi-desk office lease, company renewal services. The cost of services is stated for the sole shareholder and possibility to obtain 2 resident visas (minimum package). Other options are available on request.
9,500
Obtaining a resident visa (expenses when obtaining 1 visa*), including: - payment of all government fees (Entry Permit, Medical & Emirates ID, Visa Stamping); - services for the execution and submission of applications and necessary documents; - support services (a trip to the clinic and migration service). *In the case of obtaining 2 or more visas, please ask your consultant for the exact cost
4,200
Assistance in opening bank accounts (irrespective of the result). Corporate account/Personal account
2,500/2,500
Compliance fee. Paid in case of: company’s renewal, company’s liquidation, transfer to another agent, issue of a power of attorney for a new attorney, change of director/shareholder/beneficiary, except for a change to a nominee director/shareholder
250 (standard fee – includes check of 1 individual) + 50 for each additional individual (director, shareholder or beneficiary) or legal entity (director or shareholder) if legal entity is serviced by GSL; + 100 for each additional legal entity (director or shareholder) if legal entity is not serviced by GSL; 350 (check for High Risk companies, including check of 1 individual)
Keeping accounting records of the company’s business. Systematic archiving of the company’s documents and provision thereof to the client on request
200 / hour[5]
Preparation of financial statements, audit of the company’s business and filing of financial statements with the authorities of the free zone
400 / hour
Registration for VAT purposes
850
Preparation and filing of VAT returns
200 / hour
Tax consultation on VAT and other issues
300 / hour
Other services as agreed with the client
200 / hour

[1] The cost of the package may vary depending on the number of shareholders, kind of license and size of the office (the size of the office and kind of license define the number of resident visas).

[2] The deposit is refunded after the license is cancelled.

[3] The cost of services is effective as of May 2021.

[4] The deposit is refunded after the license is canceled.

[5] The cost of preparation of financial statements and audit of the company’s business is determined based on time spent on work at the rate of 100 to 400 USD per hour depending on the type of work and qualification of the specialist involved; it is at least 1,900 USD – the cost of audit of statements with the minimum number of transactions.

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