Freezones in the UAE are uniquely characterized by the ability of foreign shareholders to hold 100% of the share capital, as opposed to mainland companies, which require 51% local ownership. Hamriyah freezone does not require a minimum capital investment, instead focusing on fostering innovation in 7 fields, which include: oil and gas; petrochemicals; steel; construction; timber; maritime; and perfume manufacturing and services. In this article, we discuss the commercial aspects surrounding company formation in Hamriyah Free Zone.
The Hamriyah Freezone was established in 1995 by the Government of Sharjah in order to foster entrepreneurial innovation with the unique advantage of providing direct access to the Indian Ocean through its ports, which feature cargo hubs. The Hamriyah Freezone provides access to the western and eastern ports of the city of Sharjah. Sharjah’s strategic location also allows easy access into all 7 emirates and most particularly into Dubai, Abu Dhabi, and Ras Al Khaimah. The ports also provide access into the Asian and African markets.
Aside from standard licensing fees and processes, companies within the free zone are entitled to determine the legal structure of their companies, whether Free Zone Company (FZC) or Free Zone Establishment (FZE), or a branch of an already-existing company. Sharjah’s geography, with its access to ports, as well as its cost-effective electricity, water, cost of living, and maintenance give companies a unique incentive to set up shop in the free zone.
The free zone itself provides streamlined application processes for company formation and obtaining licenses (including commercial, services, and industrial licenses). The most basic of licenses which can be obtained at the free zone is a commercial trade license, which runs AED 25,000, and provides the company in question 4 visa allotments and a small office space. This is a great advantage, as many free zones separate licensing and office space fees; alone, the office space fees may become quite costly. As such, the office space included in the licensing package is considered to be of great advantage.
With a focus on client satisfaction, Hamriyah Freezone provides upcoming companies great incentives to form their company in the free zone. The free zone’s strongest feature is its open yard storage, which has established more than 200,000 sq. m. of space, meeting the cargo needs of free zone companies as they often arise. These spaces can be rented for up to 25 years, renewable, and come pre-built and well-maintained.
The 14 meter deep waters of Hamiryah port make it such that handling general cargo and oil tankers is easily done. The emirate of Sharjah has made great strives to ensure than the free zone meets the infrastructural needs of clients. The free zone also features close access to Sharjah International Airport, as well as a tax-free environment which the United Arab Emirates is known for.