Sharjah's Economic Free Zones

It is always important to start with the basics, in life and in business.

Sharjah is the third-most populous city in the United Arab Emirates, It is the capital of the Emirate of Sharjah and forms part of the Dubai-Sharjah-Ajman metropolitan area, the main urban conglomeration of the UAE. The Emirate of Sharjah is ruled by the same Al-Qassimi dynasty that rules the emirate of Ras-Al-Khaimah.

The city is a massive contributor to the Emirati economy, contributing 7.4% of GDP. As of the 2023 census, Sharjah city has a population of over 1.8 million people.

The city is rather conservative and a 'dry' town, with alcoholic beverages prohibited within city limits. But it is rather progressive in terms of economy, being the first city in the Middle East to adopt a four-day work week. It's also been touted as a premier family-friendly tourist destination in the UAE with its famous Sharjah Book Fair, Aquarium and Museums.

An economic free zone, also known as a free trade zone or special economic zone (SEZ), is a designated geographic area within a country that operates under different economic regulations and policies compared to the rest of the country’s territory. These zones are established by governments to promote economic growth, attract foreign investment, boost exports, and create more employment opportunities for citizens and permanent residents. Economic free zones typically offer various incentives and benefits to businesses for establishing operations within their boundaries.

EZs or Economic Free Zones have several characteristics--

Tax Benefits: Many economic free zones offer tax incentives such as exemptions or reduced rates on corporate income tax, customs duties, VAT and other taxes.

Customs Regulations: Free zones often have relaxed customs regulations and streamlined import-export procedures to facilitate international trade.

Foreign Ownership: In many cases, foreign investors are allowed to fully own businesses established within economic free zones, whereas in the rest of the country, there may be restrictions on foreign ownership.

Regulatory Flexibility: Free zones typically have simplified regulatory processes, making it easier and faster for businesses to set up and operate.

Infrastructure and Facilities: Governments often invest in infrastructure development within free zones, providing modern facilities such as office spaces, warehouses, logistics centers, and utilities.

Employment Regulations: Free zones may have more flexible labor regulations compared to the rest of the country, including relaxed visa requirements and employment rules.

Intellectual Property Protection: Many economic free zones offer enhanced intellectual property protection to attract technology and innovation-focused businesses.

Sector-Specific Focus: Some free zones are dedicated to specific industries or sectors such as technology, finance, manufacturing, logistics, or tourism, catering to the unique needs of those industries.

Now, here is some information about the Sharjah Economic Zones:

The Sharjah Free Zone, situated in the Emirate of Sharjah, serves as a specialized economic zone aimed at bolstering economic diversification, attracting foreign investment, and propelling industrial growth. Established in 1995, it has since expanded to encompass several zones, each tailored to specific industries and business activities, significantly contributing to Sharjah's economic development.

Differentiating between mainland and free zone setups in the UAE is pivotal for businesses. Mainland companies offer advantages like unrestricted business conduct across the entire UAE, full repatriation of profits, and broader market access. Conversely, free zone companies provide benefits such as 100% foreign ownership, expedited formation processes, and advanced infrastructure.

Understanding the disparities between Free Zones and Limited Liability Companies (LLCs) is essential for entrepreneurs. Free Zones permit complete foreign ownership, ideal for specific industries like international logistics and the technology sector, whereas LLCs offer a broader scope of activities and flexibility in location, catering to businesses serving local markets.

Sharjah Free Zones offers various licenses tailored to different business activities, including trading, manufacturing, services, media, technology, and consultancy. The process of obtaining a license involves meticulous planning, selecting business activities, reserving a business name, submitting required documentation, leasing office space, and opening a bank account.

Businesses opting for the Sharjah Free Zone setup enjoy advantages such as full foreign ownership, profit repatriation, strategic location, flexible licensing, streamlined setup processes, access to a skilled workforce, and state-of-the-art infrastructure. The costs associated with acquiring a license vary depending on factors like business activity and office space requirements.

Sharjah's economy presents numerous advantages for businesses, including its strategic location as a global trade hub, business-friendly environment, full profit repatriation, world-class infrastructure, diverse business activities, skilled workforce, economic stability, foreign investment attractiveness, vibrant business ecosystem, and high quality of life.

Choosing Sharjah Publishing City Free Zone offers entrepreneurs a comprehensive solution for business setup in the UAE. With over 1,500 available business activities, the zone caters to various industries, providing modern facilities and licenses tailored to diverse business needs, making it an ideal destination for investors seeking opportunities in publishing or other sectors.

As for the steps on how to establish it, here they are as they are written.

1) Select the Type of Company: Decide whether you want to set up a Free Zone Establishment (FZE) for a single shareholder or a Free Zone Company (FZC) for multiple shareholders.

2) Submit Application: Prepare and submit the application form along with all required documents to the Sharjah Free Zone Authority (SFZA). Documents typically include:

3) Completed application form requirements:

• Passport copies of shareholders and managers
• Proposed company name
• Business plan
• NOC (No Objection Certificate) from current sponsor if the shareholders or managers are UAE residents
• Specimen signature of shareholders and managers
• Board resolution (if the shareholder is a company)
• Memorandum and Articles of Association (MOA and AOA)

4) Legal Procedures and Approvals: Once the application is submitted, the Sharjah Free Zone Authority will review it. Upon approval, you will need to sign the relevant documents, including the Memorandum and Articles of Association.

5) Payment of Fees: Pay the required fees for registration, licensing, and other services as per the fee structure provided by the Sharjah Free Zone Authority.

6) Obtain Business License: After completing the registration process and paying the necessary fees, you will receive your business license from the Sharjah Free Zone Authority.

7) Open a Corporate Bank Account: Once you have obtained your business license, you can proceed to open a corporate bank account in the UAE.

8) Visa Processing (if necessary): If you need visas for yourself or your employees, you can apply for them through the Sharjah Free Zone Authority. Each Free Zone has its own visa regulations and requirements.

9) Lease Office Space: You will need to lease office space within the Sharjah Free Zone to operate your business. The Free Zone authority can assist you in finding suitable premises.

10) Commence Business Operations: After completing all the necessary formalities, you can start operating your business in the Sharjah Free Zone.

List of Free Zones in Sharjah:

Hamriyah Free Zone: ideal for large warehouse and industrial operations.

Sharjah International Airport Free Zone: an excellent regional hub for air cargo and goods sold duty-free in airports.

Sharjah Media City: A prime location for film and television production in the UAE, with 2 million square feet of space. An excellent media production site for Bollywood/Lollywood as well as global film producers.

Sharjah Publishing City (SPC): A hub for Arab and global book publishers and newspapers as well as e-commerce. See also the UAE Mystery Shopper App.

USA Regional Trade Center: A site for conventions and trade shows.