UAE Free Zone Company Setup: IFZA, DMCC, RAKEZ, Meydan, SHAMS

A UAE free zone company setup gets you 100% foreign ownership, a UAE trade license and, if you want them, residence visas, usually within days and for a first-year cost that starts around AED 6,000 in the northern emirates and runs past AED 35,000 in the premium Dubai zones. Which zone is right depends on three things: what you actually sell and to whom, how many visas you need, and how much weight the address carries with your banks and counterparties.

The license is the easy part. The hard parts come after: getting a corporate bank account, knowing whether you'll pay 0% or 9% corporate tax, and keeping the UBO and tax filings current. This guide compares IFZA, DMCC, RAKEZ, Meydan and SHAMS on cost and features as of October 2026, shows how to evaluate a zone and the setup company selling it (with Meydan as the worked example), explains how visa allocation and flexi-desks actually work, and covers the compliance obligations most setup agents skip.

What a free zone company is (and what it isn't)

A free zone company is a legal entity registered with one of the UAE's free zone authorities rather than with an emirate's mainland economic department. The trade-offs are consistent across zones:

• Ownership. 100% foreign ownership, no local partner.
• Licensing. The free zone authority is your registrar and licensing body. It issues the license, keeps your shareholder and UBO records, and sponsors your visas through the company's immigration establishment card.
• Scope. Your license lists specific activities. You can do those, and only those.
• Market access. Free zone companies have traditionally been restricted from trading directly with mainland UAE customers without a distributor, agent or mainland branch. Dubai loosened this in 2025: Executive Council Resolution No. 11 of 2025 lets Dubai free zone companies (DIFC entities excluded) apply to the Department of Economy and Tourism for a mainland branch license (AED 10,000 a year) or a temporary permit of up to six months (AED 5,000), subject to approval from their free zone, any sector regulator, and DET's list of eligible activities. Mainland activity has to be kept in separate financial records. It applies to Dubai only; selling into other emirates needs their own approvals.

What a free zone company is not: a tax exemption. Since June 2023 every free zone company is inside the UAE corporate tax system. Some qualify for 0% on certain income; many don't. More on that below and in our full guide to UAE corporate tax for free zone companies.

Free zone vs mainland vs offshore

If your customers are overwhelmingly outside the UAE, a free zone is usually the cleaner fit. If you need to sell to UAE consumers, bid for government work or run a shop, look hard at mainland or at the Dubai free zone branch route before you commit. And if your customers and suppliers are mostly in Asia, compare the UAE with Hong Kong and Singapore companies before you default to Dubai.

What a UAE free zone company setup actually costs

Advertised package prices rarely equal your first-year cost. When comparing free zone company setup cost, break it into these lines:

1. License and registration. The package price, usually including the trade license, registration and a flexi-desk or co-working seat.
2. Immigration establishment card. A one-off (then renewable) card that lets the company sponsor visas. Some packages include it; many price it separately.
3. Residence visa per person. The visa itself, the entry permit, change of status if you're already in the UAE, medical test and Emirates ID. Meydan, for example, publishes a visa allocation fee of AED 1,850 per visa, an investor visa at around AED 4,000 and medical plus Emirates ID at AED 2,250, so one investor visa costs roughly AED 8,000 on top of the license before the establishment card.
4. Physical office, if needed. Upgrading from a flexi-desk to a dedicated office increases both cost and visa quota.
5. Renewal. Year-two cost is usually lower because registration and establishment-card fees aren't repeated, but it is still a real annual cost. Some zones now offer multi-year pricing or renewal price locks.
6. Professional fees. Agent fees, attestation of foreign documents, bank account introduction, accounting and audit.

Budget from the full list, not from the headline.

IFZA vs DMCC vs RAKEZ vs Meydan vs SHAMS: comparison table

Figures below are indicative as of October 2026, taken from each free zone's own published packages where they publish them, and from reputable setup-firm quotes where they don't. Promotions change often. Treat every number as "starting from" and confirm a written quote before paying.

Two notes on reading this table. First, the cheapest license is not the cheapest setup once you add visas. Second, visa cost differs more between zones than license cost does, so model your real headcount.

Evaluating Meydan Free Zone and the setup companies that sell it

Most people searching for Meydan are really evaluating two things at once: the free zone itself, and the business setup company quoting them for it. Here's how to judge both.

Meydan as a free zone. It's a Dubai address with a fully digital process. As of October 2026 Meydan publishes a standard license from AED 12,500 with a flexi-desk, three activity groups and no visa allocation, extra activities at AED 1,000 each, and the Fawri instant license from AED 15,000, issued in under an hour across more than 1,800 activities. Visas are priced separately: AED 1,850 allocation per visa (up to six per license), around AED 4,000 for an investor visa, AED 3,500 for an employment visa and AED 2,250 for medical and Emirates ID. Upgrades are published too: a shared office from AED 15,000 a year and a dedicated office from AED 30,000. It suits service, consulting, e-commerce and trading businesses with a small team and mostly international customers. Because it's a Dubai free zone, the DET branch license and temporary permit route to the mainland is open to it, subject to approvals. It isn't the name that carries weight for commodities trade finance; that's still DMCC.

The setup company selling it. Meydan sells direct through its own portal, so an agent is adding service, not access. Before you pay one, check:

1. The quote is itemised against Meydan's published fees. License, activities, visa allocation, each visa, establishment card, medical and Emirates ID, facility and the agent's own fee as separate lines. A single "package" number hides the markup and the items left out.
2. It's a first-year cost and a year-two cost. Ask for the renewal figure in writing. Meydan publishes multi-year discounts but not a renewal price list, so the agent should get it confirmed.
3. The activities match the business. A good agent pushes back if your activity wording doesn't match your website and invoices, because the bank will compare them.
4. No banking guarantees. An agent can introduce you to banks; nobody can promise an account. "Guaranteed bank account" is a red flag, as is any suggestion to describe the business more blandly than it is.
5. You keep control. The company's portal login, license, articles and share certificates should be in your name and your inbox, not held by the agent.
6. Tax registration is in scope. Corporate tax registration is due within three months of incorporation; check whether the agent files it or leaves it to you.
7. They tell you when Meydan is the wrong zone. For warehouse-heavy trading, RAKEZ is usually cheaper; for commodities, DMCC. An agent who only ever sells one zone is a salesperson for that zone.

Best free zone for trading, consulting and e-commerce

There is no universal "best free zone". There is a best fit for a specific business model.

Trading

• Physical goods moving through the UAE: RAKEZ is strong for trading and light industrial activity, with warehouse and industrial facilities available.
• Commodities (metals, energy, agricultural products): DMCC is the reference point. It costs more, but the name carries weight with banks, trade finance providers and counterparties.
• Banking angle: general trading licenses are getting the hardest bank reviews in 2026, especially anything touching Iran, Russia or dual-use goods. Our guide to UAE trading company sanctions reviews covers the counterparty and end-use file banks now ask for.
• Tax angle: trading of qualifying commodities and distribution of goods from a Designated Zone are qualifying activities for the 0% corporate tax regime. General trading with mainland buyers or consumers is not. Check whether your intended zone is a Designated Zone before you rely on the distribution route.

Consulting and professional services

• IFZA, Meydan and SHAMS are the usual shortlist: reasonable cost, flexi-desk options and fast digital processes. SHAMS is particularly common for media, marketing and creative services.
• Tax angle: most consulting, marketing, design and software services to unrelated clients are not qualifying activities. Expect to budget for 9% on profits above the relevant threshold unless your adviser confirms otherwise.

E-commerce

• Look for zones that license e-commerce as an activity and allow you to add related activities (general trading, marketing) to the same license. RAKEZ's 10-activity packages and SHAMS's 5-activity license are both relevant here.
• Tax angle: sales to individuals are generally treated as non-qualifying for free zone purposes, so B2C e-commerce rarely benefits from the 0% rate.
• Payments angle: your merchant account and settlement banking matter more than your license. If you sell in higher-risk categories, read our guide to high-risk merchant accounts and multi-MID routing before choosing a structure.

Holding and IP

Free zone companies can hold shares and IP, and holding shares for investment is a qualifying activity. For a pure holding vehicle with no visa needs, compare a free zone company with an offshore company, and consider where the bank account will sit. If the alternatives on your list are classic offshore names, see how BVI, Cayman and Seychelles compare on banking and cost in 2026.

Visa allocation and flexi-desks explained

Visa allocation is the maximum number of residence visas your company can sponsor. In most free zones it's tied to the facility you lease: a flexi-desk supports a small number of visas, a dedicated office more. Some packages bundle a visa; others sell the allocation and the visa separately.

A flexi-desk is a shared-workspace entitlement that satisfies the free zone's requirement for a registered facility. It gives you a registered address and a lease document, and it's enough to get a license and a small number of visas. It is not a real office. That matters in two places:

• Banks will ask where your team actually works. A flexi-desk is acceptable at most banks for a small, clearly international business, but it doesn't count as substance on its own.
• Corporate tax. If you intend to claim Qualifying Free Zone Person status, you need adequate substance (people, assets and spending) in the free zone. A flexi-desk and no staff is a weak position.

Emirates ID follows the residence visa. Many UAE banks require at least one authorized signatory with a UAE residence visa and Emirates ID, so even founders who plan to live elsewhere often take one visa for this reason. We cover this in detail in our guide to opening a UAE corporate bank account.

Step-by-step: how the setup works

1. Define activities and customers. List exactly what you'll sell, to whom and from where. This drives the zone, the license activities, your tax position and your bank's risk rating.
2. Choose the zone and package. Get a written quote covering license, establishment card, every visa, medical, Emirates ID, facility and renewal.
3. Reserve the trade name and submit the application with passport copies, photos and, for corporate shareholders, attested corporate documents.
4. Declare beneficial owners. You'll provide UBO details at incorporation (see below).
5. Receive the license, articles of association, certificate of incorporation, share certificates and lease or flexi-desk agreement.
6. Apply for the establishment card and visas. Entry permit, change of status or entry, medical test, Emirates ID biometrics, visa stamping.
7. Register for corporate tax with the Federal Tax Authority. New UAE entities, including free zone companies, have three months from incorporation to apply; late registration carries an AED 10,000 penalty. The FTA can waive it if the first return is filed within seven months of the end of the first tax period, but don't plan around the waiver.
8. Register for VAT if your taxable supplies exceed AED 375,000 over 12 months (voluntary registration is available from AED 187,500).
9. Open the bank account. Start preparing the bank file during step 2, not after step 6.

The UBO register and ongoing compliance

The license is renewed once a year, but compliance is continuous.

• UBO register. Under Cabinet Decision No. 109 of 2023, UAE companies, including those in non-financial free zones, must keep a register of beneficial owners: the natural persons who ultimately own or control 25% or more of the capital or voting rights, or who otherwise exercise control. The company files this with its registrar and must update it, along with the shareholder register, within 15 days of any change. Penalties escalate for repeat breaches and can reach license suspension.
• Nominee arrangements. The UBO regime requires disclosure of the real owner. Using nominees or straw owners to hide who controls a company is exactly what it's designed to catch, and banks treat it as a hard stop. Nominee directors, where used legitimately, must be disclosed to the registrar with the identity of the person they act for.
• Corporate tax filing. A return within nine months of the end of each tax period, even if you owe nothing.
• Audited financial statements if you claim Qualifying Free Zone Person status or have revenue above AED 50 million. Some free zones also ask for audited accounts at license renewal, so check your zone's rules.
• E-invoicing. The UAE mandate applies to any person conducting business in the state; check with your adviser how it applies to your entity. Businesses with revenue of AED 50 million or more must appoint an Accredited Service Provider by 30 October 2026 and go live on 1 January 2027; everyone else must appoint one by 31 March 2027 and go live on 1 July 2027. Ministerial Decision No. 197 of 2026 exempts transactions inside a VAT group for 2027–28 and drops the requirement to store invoice data inside the UAE.
• Economic substance reports are no longer required for financial years ending after 31 December 2022, after the ESR regime was discontinued in 2024. Substance still matters for corporate tax and for banks.
• License and visa renewals, plus updating the free zone whenever shareholders, directors, managers or activities change.

Common mistakes to avoid

• Picking the cheapest license and then paying more on visas, renewals and a facility upgrade.
• License activities that don't match the business. Banks compare your license wording with your website and invoices. A mismatch is one of the most common reasons for account rejection.
• Assuming 0% tax. Free zone status is not the same as qualifying income.
• Selling to the UAE mainland without the right license or permit.
• Leaving banking to the end. A licensed company with no bank account can't invoice, pay staff or receive settlement. For businesses that also need non-AED accounts, see our comparison of EMIs vs banks for multi-currency IBANs.
• Treating the setup agent as a tax adviser. Most aren't. Get corporate tax advice from a registered tax agent or adviser before you choose your structure, not after.

How Actionman helps

We design the structure around how your money actually moves: which free zone fits the activity, which entity holds what, and which banks and payment providers will accept it. We then coordinate the licensing, banking introductions and tax registration so the pieces line up. If you're weighing zones or restructuring an existing UAE entity, talk to us with your activity, customer locations and visa needs.