There are nearly 15 Free Zones in UAE and across the country. Each Free Zone controlled and regulated by its own
authorities. These Free Zone authorities have their own code of conduct. Some will attract more foreign investors as
they are more sophisticated and for many more reasons.

The distinctive Free Zone authority will issue the license and register the company. Typically, Free zones are industry
focused and are tailored to particular industries. Consequently, they only license/register the specific type of activities.
Therefore, finding the right Free Zone base on the industry of your business and granting the license under accurate
activity are the key focuses for any entrepreneur.

The classes of Limited Liability Company or a Branch of a Foreign Company can be established in a Free Zone. In both
cases, it is permitted 100% foreign ownership and no requirement of an Emirati National Sponsor or Emirati National
Service Agent unlike in the Mainland. Among the vast number of Free Zones, there are two types of LLC. Those are
Free Zone Company or Free Zone Establishment. However, the main difference between these two types is a number of
shareholders and the share capital requirement.

The Free Zone company is a fiscal local resident establishment with access to the DTAA (Double Taxation Avoidance
Agreement). On this principle, an entrepreneur will be qualified for visas as Shareholder and /or Manager of the
establishment. Though, the Free Zone LLC companies are not authorised to carry out business activities in mainland
UAE. However, it allows to do business only within Free Zones and outside of UAE. Nevertheless, as a solution to trade
in the Mainland, if it is a representative office of a foreign branch established under a Free Zone, they can deal with
Onshore distributor/ agent (this distributor shall hold an appropriate license) or shall have their own Onshore LLC or a
Branch.

The Free Zone companies follow compulsory controls of International Financial Reporting Standards (IFRS). New VAT
rules are applied by the Federal Tax Authority therefore, the balance sheet audit became obligatory. In order to obtain
the certificate of Tax Residence by Ministry of Finance(MOF) balance sheets shall be audited by a UAE regulated
auditor. This statute describes in Federal Decree-Law No. (8) of 2017 on Value Added Tax of the United Arab Emirates,
registration and declarations.

As per the RAKICC Business Companies Regulations 2018, the client and investor cannot concoct a Non-resident establishment, pay the fees and/or apply for certificates requests directly via Ras Al Khaimah International Corporate Center (RAKICC) authority. All the processing and procedures under the name and on behalf of the clients shall create by a Registered Agent. Consequently, “Registered Agent” is an obligatory corporate body who is accredited by an accreditation body in the UAE to processes all the corporate incorporation records including KYC and AML diligences.

All RAKICC companies require that their foreign business corporations, to have an address within the country. This is also termed as Registered Address. Registered Agent shall reside in the Registered Address.

There are essential roles such as Director and appointing a secretary following the incorporation of a Non-resident Company/Offshore.

Since it is defined as a non-resident company establishment and on this principal NOR Shareholder, Director or Secretary will eligible for the visas.
As a consequence, the establishment will NOT have access to DTAA or the ability to trade within the UAE territory.

The non-resident companies are the best solutions as Holding companies.