Setting up business in a UAE free zone carries many advantages for overseas investors. Perhaps most importantly, it enables foreigners 100% ownership, zero corporate taxes and repatriation of profits.
A number of such free zones operate across the UAE and predominantly in the Emirate of Dubai. Readers interested in setting up in a Dubai free zone are encouraged to read the Hadef & Partners guide on this topic.
Investors in the broadly termed "knowledge economy" may be most interested in setting up in TECOM which caters to associated specialisations. Abu Dhabi is also promoting various knowledge economy initiatives, such as the media focused free zone, twofour54.
TECOM Investments, a member of Dubai Holding, has realigned its 11 business parks (each a free zone) into five industry cluster groups to streamline its operations and to prepare for further business growth.
- Information and Communication Technology (ICT)
- Media
- Education
- Sciences
- Manufacturing and Logistics.
TECOM has also created a new entity, the TECOM Business Parks Operations, to support these clusters.
TECOM's primary objective remains developing Dubai's knowledge-based economy. The restructuring will provide a more focused approach to achieving this goal. By grouping together business parks that focus on specific industries, TECOM believes it is better positioned to sustain its growth and extend all its support to its business partners. One can readily see the merit in the following restructuring:
- Dubai Internet City and Dubai Outsource Zone comprise the ICT Cluster.
- Dubai Media City, Dubai Studio City and International Media Production Zone comprise the Media Cluster.
- Dubai Knowledge Village and Dubai International Academic City comprise the Education Cluster.
- Dubai Healthcare City, DuBiotech and Enpark comprise the Sciences Cluster.
- Dubai Industrial City comprises the Manufacturing and Logistics Cluster.
These five clusters also align closely with five of the 12 industry sectors highlighted in the Abu Dhabi Plan 2030:
- Telecommunication Services
- Education
- Media
- Pharmaceutical, Biotech and Life Sciences
- Transportation, Trade and Logistics.
The other seven Abu Dhabi sectors are:
- Energy – Oil and Gas
- Petrochemicals
- Metals
- Aviation, Aerospace and Defence
- Tourism
- Healthcare Equipment and Services
- Financial Services.
"Decision No. 1 of 2010 Concerning Licence Categories" for the TECOM free zones (issued on 21 March 2010) sets out the categories of business for which a licence may be issued in any zone. This updates and replaces the previous Decision No. 1 of 2009 and shall be read with Decision No. 2 of 2006. We will have to watch this space to determine the extent to which TECOM establishes any additional rules and regulations for the new clusters. For participants in the existing TECOM business parks, TECOM Investments stresses business will be as usual.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.