Dubai International Financial Centre (DIFC), one of the top financial centres in the region, has recorded its best annual performance ever by achieving 996 company registrations in 2021. With this, the free zones have managed to achieve their 2024 growth targets three years ahead of the schedule. The new numbers are triple the average reported by the DIFC across the last decade. Against this backdrop, it’s worthwhile to probe why foreign investors prefer the process of business setup in DIFC.
DIFC is known for its robust regulatory structure and modern infrastructure. The free zone offers a cost-effective platform for startups and innovative businesses. Business setup consultants in Dubai can guide you on how to obtain a DIFC trade license. However, before applying for a license in DIFC, read the following article to know why you should opt for the free zone:
An International Hub for Financial Firms
Being a leading financial centre in the Middle East, DIFC is home to thousands of financial and innovation firms. The core segments in DIFC include banking, brokerage, investment banking, insurance and reinsurance, asset management, private equity, wealth management, Fintech etc. Apart from these core business activities, companies registered in DIFC also engage in activities such as art galleries, cafes and restaurants, professional services, corporate offices etc. Business setup advisers in Dubai can help you choose your business activities in the free zone.
Independent Regulatory Framework
One of the key benefits of business setup in DIFC is you can get access to a unique legal and regulatory framework, which is designed as per international standards and principles of common law. Setting up a company in DIFC is beneficial to foreign investors as the free zone is governed by an independent regulatory system. The free zone has three regulators, which are
- The DIFC Authority (DIFCA) for non-regulated entities
- Dubai Financial Services Authority (DFSA) for financial firms
- DIFC Courts for overseeing arbitration
Independent Legal System
Foreign investors setting up business in Dubai or any other GCC countries often find it hard to navigate the legal system of the jurisdiction. Most of the countries in the region are governed by Islamic Law and the official language is Arabic. If a dispute arises, you must rely upon an attorney well-versed in the Arabic language. In contrast, the DIFC Courts are based on an independent, English-speaking, common law judicial system, which is distinct from the UAE legal system. International companies find very few barriers when dealing with disputes in DIFC.
Strategic Location
DIFC is strategically located in Dubai, which is regarded as a gateway into the Middle East and other major markets. DIFC’s location is well-positioned to harness the potential of emerging markets in Asia and Africa. The free zone offers excellent connectivity through sea, air and land, which makes international business easier. Management offices, holding companies and family offices can set up their business close to the assets they own or manage. 100% Foreign Ownership
Foreign investors setting up a business in DIFC can fully control their business with 100% ownership. Just like any other free zone in the country, company formation in DIFC doesn’t require foreign investors to partner with a UAE national. Foreign entrepreneurs are also allowed to fully repatriate profits as well.
Opportunities for Start-ups
One can say without a doubt that DIFC is one of the leading free zones in Dubai providing business opportunities for new startups. The facilities and infrastructure available in DIFC are conducive for tech startups. The free zone provides support in the form of business setup services, incubation and funding opportunities for startups. The following facilities are available for startups:
- DIFC Innovation Hub
- DIFC Fintech Hive
- DIFC Future Campus
- DIFC Fintech Fund
Innovation License in DIFC
DIFC provides an Innovation License for entrepreneurs to set up, grow and scale up their innovative startups. By obtaining a DIFC Innovation License, startup entrepreneurs can easily connect with a community of banks, financial institutions and providers of business setup services in Dubai. The DIFC Innovation License can be obtained at a cost of as low as USD 1,500/year with access to the best coworking and flexible desk spaces.
Hire the Best Business Setup Consultants in Dubai
The process of business setup in DIFC involves certain common aspects that are uniform across almost all jurisdictions. However, since DIFC is governed by its own independent regulations, you need to be aware of its rules. Adopting a casual approach may derail the process but business setup consultants in Dubai such as Jitendra Business Consultants (JBC) can help you. JBC can assist you with key business setup services in Dubai such as bank account opening, document drafting, visa processing, VAT compliance, Economic Substance Regulation (ESR) compliance, Anti-Money Laundering and Combatting Financing of Terrorism (AML-CFT), Ultimate Beneficial Ownership (UBO) etc.