Investors and entrepreneurs can now manifest their business dreams in UAE’s free zones. These are specific areas in the country in which 100% foreign ownership is permitted. Free zones are run under specific laws and regulations of their respective government departments, and they cater to various business types and models. One such business type is e-commerce businesses, where owners can run their business online using a website. Here are the steps to consider if you are looking to start an e-commerce business in one of UAE’s free zones.
The first thing to attend to after choosing a legal structure for the business is the selection of the free zone. UAE has a great variety of free zones, and the most popular of all are located across Ajman, Sharjah, Ras Al Khaimah (RAK), Abu Dhabi, and Dubai, each having its own employment law. Within Dubai, the prominent free zones to choose from are Dubai Multi Commodities Centre (DMCC), which is also referred to as the “Global Free Zone of the Year,” Dubai World Central Free Zone (DWC), Jebel Ali Free Zone (Jafza), Dubai Airport Free Zone Authority (DAFZA), and Dubai Silicon Oasis Authority (DSOA).
In the capital, Abu Dhabi, the most popular zone is Khalifa Industrial Zone Abu Dhabi (KIZAD). In Ras Al Khaimah, it is RAK EZ (Economic Zone), and in Ajman, it is called Ajman Free Zone. As for the Sharjah, there are two: Sharjah Media City Free Zone (SHAMS) and Sharjah Publishing City (SPC). Depending on where the investor or business owner would be situated, they can contact respective free zone departments or business setup consultants in Dubai for further information on what specific provisions are listed under their licenses. Based on the pros and cons of each free zone, wherein accessibility, convenience, advantages, and cost-effectiveness are considered, a final decision can be made on where the final company would be registered within the UAE.
The next step is to complete the application at the main authority’s department and gain an e-commerce license (Dubai). This requires gaining approvals, filling out an application, providing all necessary documents, and registering the company name with the help of a local agent from a business setup company Dubai. After this, the e-commerce application can be submitted for an initial approval certificate that is used to draft a Memorandum of Association (MOA) with the local agent.
The third step is registering with ports and customs authorities in the city for any import and export of material or products. Once completed, physical space must be rented in the free zone land, and the e-commerce license (Dubai) must be collected from the respective authority, such as the Department of Economic Development (DED) if the free zone is in Dubai. With all these documents and approvals in hand, a corporate bank account is opened to collect and store revenue and capital for expenditures in the trade. Completing these steps helps fulfill all legal requirements for opening and running an e-commerce business, ensuring a hassle-free trade experience from the very start.
Further, another vital component of the e-commerce setup is the website used to run the business. It will be used to attract more customers and convince them of why they should choose your business. When creating a website, it is best to keep a checklist of all the items that must be included, such as the advertised products, information on the business and the team involved, and web pages that share the company’s Corporate Social Responsibility (CSR) and other efforts to ensure an environment-friendly approach to run the business. Furthermore, the website must have a payment gateway that is secured and running, which can be initiated by partnering with a bank of your choice or other software companies that will help ensure safe transactions when products are being purchased.
Finally, while you check that the website is functioning effectively with the help of an outsourced or personal IT support, it is also important to regularly track the supply chain and ensure that all products are delivered to customers on time. All processes should be followed up on, and these include receiving the imported products or raw materials, manufacturing the goods if involved, packaging them, picking them up from the warehouse, and delivering them to the client’s home. These operations can run smoothly when reliable contacts are used to establish business relations and when advice is taken from company formation experts in the city.
