Profile

The United Arab Emirates (UAE) contains a number of attractive jurisdictions for incorporating a company. Its location is a strategic East-West gateway with significant infrastructure such as ports, and it has developed business-friendly policies. The seven emirates which make up the UAE are: Abu Dhabi, Dubai, Sharjah, Ajman, Umm Al Quwain, Ras Al Khaimah, and Fujairah

The historic oil-centric economy has been largely replaced by new sectors including finance, technology and tourism. It is a low-tax environment and there are no currency movement restrictions.

The UAE has three categories of jurisdiction available: Mainland, Free Zone and Offshore. Mainland companies are intended mainly for the local market, and can trade within the UAE and overseas.

Free Zones exist throughout the UAE with forty now available. They may be fully foreign owned and have no corporate or personal tax and have custom duty concessions but are not suited to local trade, only overseas.

Offshore companies are used for international business, tax exemption reasons and asset protection. They may be fully foreign owned but may not conduct business in the UAE, only overseas.

Political stability is good and the ease of doing business in the region is also good. It is rapidly becoming an attractive hub for startups and tech companies.

Political

The United Arab Emirates is an alliance of seven emirates, each with its own ruler who sits together for the Supreme Federal Council. A President and Vice-President are chosen within the council. This is not a democracy, there are no public elections to the council, but it is a politically stable arrangement with less incidence of violence and terror than some neighbouring countries.

Tax

While the UAE was historically famous for its 0% corporate tax rate, it did introduce tax in 2023 at a rate of 9% on earnings over AED375k / $100k equivalent. However Free Zones are exempt from this on overseas revenue.

VAT is levied at 5% on goods sold by companies who exceed the AED 375k annual revenue threshold. Imported (non-essential) goods have an excise tax of 5% applied, but to promote public health tax on imported tobacco, vaping devices and energy drinks is 100%, with fizzy drinks taxed at 50%.

Personal income tax is at 0% for citizens and overseas residents. There is no property tax, inheritance tax or wealth tax.

Legal

Overall the legal system in the UAE is a combination of common law, civil law, and Sharia law. Free Zones tend to use common law basis and are run to international standards with English language courts. Jurisdictions such as the Dubai International Financial Centre and Abu Dhabi Global Market (ADGM) provide specialist courts under English Common Law principles in order to build its reputation as an international centre and being friendly towards foreign investment. Major law firms including Clifford Chance and Allen & Overy have a significant presence in Dubai and Abu Dhabi to meet the demand from internationally-focussed businesses.

Privacy

The regulations about visibility of members of a company varies slightly by jurisdiction. Directors are typically more publicly visible, varying by jurisdiction and shareholders are usually not. An exception to this is any Public Joint Stock Companies listed on the Dubai Financial Market or on the Abu Dhabi Securities Exchange where increased transparency means that shareholders over 5% are publicly disclosed. A list of Ultimate Beneficial Owners must be accurately maintained and submitted to the registrar, but this list is not publicly visible. Nominee directors and shareholders are permitted.

KYC and AML Regulations

The UAE has its Anti-Money Laundering and Combating the Financing of Terrorism (AML-CFT) framework which i sin line with international standards. It mandates that KYC is required for both domestic and overseas businesses.

Focus on four individual jurisdictions

Otonomos has selected four of the most suitable jurisdictions within the UAE in which to incorporate a business for Tech, Web3 or investment purposes, and which can be set up from our website.

The four are: Ras Al Khaimah Digital Assets Oasis (RAKDAO), Dubai International Financial Centre (DIFC), Abu Dhabi Global Market (ADGM), and Meydan Free Zone. Each jurisdiction offers unique features tailored to specific business needs, industries, and operational goals.

Dubai International Financial Centre (DIFC)

DIFC is a financial free zone in Dubai, established in 2004, known for its robust legal and financial ecosystem based on English common law.

Key Features of DIFC:

Industry Focus: Primarily caters to financial services (banking, insurance, wealth management) but also supports fintech, professional services, and non-financial businesses.
Ownership: 100% foreign ownership is allowed. Tax Benefits: 0% corporate tax on qualifying income, no personal income tax, Cost: Higher setup and operational costs, with registration fees starting at approximately AED 25,000 and annual licensing fees varying based on activity. Office space (mandatory) adds to expenses. Regulation: Regulated by the Dubai Financial Services Authority (DFSA), known for its strict, internationally aligned standards. English common law applies, offering a familiar legal framework for global businesses. Infrastructure: World-class infrastructure, including premium office spaces, courts, and a thriving business community with over 2,000 registered companies. Location: Centrally located in Dubai, offering proximity to major business hubs and excellent connectivity.

Best For: Established financial institutions, fintech companies, and businesses seeking a prestigious address and a strong regulatory framework.

Ras Al Khaimah Digital Assets Oasis (RAKDAO)

RAKDAO is an emirate 112Km to the NorthEast of Dubai. It offers a specialized free zone called the Digital Assets Oasis (RAKDAO), which focusses particularly on digital and virtual asset companies, including blockchain, Web3, NFTs, and other emerging tech sectors. It takes advantage of Ras Al Khaimah’s business-friendly environment.
Key Features of RAKDAO: Industry Focus: Suited to digital assets, fintech, and technology-driven businesses. Ownership: 100% foreign ownership is permitted, with no requirement for a local sponsor. Tax Benefits: 0% corporate tax on qualifying income, no personal income tax, and no customs duties on activities within the free zone. Cost: Relatively low setup and operational costs compared to DIFC and ADGM, with licensing fees starting at competitive rates (specific costs depend on the business activity). Regulation: Governed by RAKDAO’s own regulatory framework, designed to be flexible and innovation-friendly, particularly for digital assets. Infrastructure: Offers modern facilities with a focus on virtual and tech ecosystems, though less extensive than DIFC or ADGM. Location: Situated in Ras Al Khaimah, providing a quieter, cost-effective alternative to Dubai and Abu Dhabi, with access to ports and logistics hubs.

Best For: Startups and businesses in the digital asset and blockchain space seeking affordability and a tailored regulatory environment.

Abu Dhabi Global Market (ADGM)

Abu Dhabi is the capital of the UAE, by far the largest by area and has the largest economy. The Abu Dhabi Global Market, established in 2013, is an international financial centre in Abu Dhabi, positioned as a hub for financial services, innovation, and technology, also based on English common law.
Key Features: Industry Focus: Focuses on financial services, fintech, and professional services, with a growing emphasis on startups and technology Ownership: 100% foreign ownership is permitted. Tax Benefits: 0% corporate tax on qualifying income, no personal income tax, and full repatriation of profits. Cost: More affordable than DIFC, with registration fees starting at around AED 10,000. The Tech Startup License costs USD 1,000 annually, and no physical office required. Regulation: Overseen by the Financial Services Regulatory Authority (FSRA), which adopts a progressive, innovation-friendly approach including crypto asset regulations. Infrastructure: Modern facilities especially on the newly-developed Al Maryah Island, including flexible office options and a growing business ecosystem, though less mature than DIFC. Location: Located in Abu Dhabi, ideal for businesses wanting to be in the capital’s financial sector.

Best For: Fintech startups, financial firms, and businesses looking for a balance of cost, innovation, and regulatory credibility.

Meydan Free Zone

Meydan is a zone in central Dubai where the Maydan Free Zone has been established as a newer free zone, designed to attract a wide range of businesses, from SMEs to creative industries, with a focus on flexibility and affordability.
Key Features: Industry Focus: Wide-ranging, including trading, e-commerce, media, consultancy, and creative industries. Less focused than RAKDAO, DIFC, or ADGM. Ownership: 100% foreign ownership is allowed. Tax Benefits: 0% corporate tax on qualifying income, no personal income tax, and no customs duties within the free zone. Cost: Highly cost-effective, with packages starting as low as AED 12,500 annually (including visa and licensing), making it one of the more affordable options in Dubai. Regulation: Governed by Meydan Free Zone Authority, with lighter compliance requirements compared to DIFC and ADGM. Infrastructure: Offers flexible office solutions (e.g., flexi-desks, virtual offices) and proximity to Meydan’s leisure and business facilities, though less extensive than DIFC or ADGM. Best For: SMEs, freelancers, and businesses seeking low-cost entry into Dubai with operational flexibility. Jurisdiction selection summary Business Focus - choose RAKDAO for digital asset ventures, DIFC for financial prestige, ADGM for fintech innovation, or Meydan for generic activities. Costs: Meydan and RAKDAO are cost-effective, while DIFC is premium, and ADGM offers a middle ground. Regulation: DIFC and ADGM provide robust, internationally recognized frameworks; RAKDAO and Meydan are more flexible. Location: DIFC and Meydan benefit from Dubai’s global appeal, ADGM benefits from Abu Dhabi’s capital status, and RAKDAO offers a quieter, logistics-friendly base.