UAE Free Zones Roll Out Exciting New Business Incentives 2025

REAL ESTATE23 hours ago

The United Arab Emirates has long been a global hotspot for business, trade, and investment, thanks in large part to its network of thriving free zones. Now, the UAE is taking its free zone offering to the next level with a fresh set of incentives aimed at attracting more international investors and supporting local entrepreneurs.

In June 2025, several UAE free zones announced significant updates to their incentives packages, focusing on reducing business costs, encouraging innovation, and making it even easier to set up and grow a company in the Emirates. These updates are part of the country’s wider plan to remain competitive on the global stage and to align with its vision for a diversified, knowledge-based economy.

Key Changes in Free Zone Incentives

The latest updates cover a broad range of incentives across many UAE free zones, including Dubai Multi Commodities Centre (DMCC), Jebel Ali Free Zone (JAFZA), Dubai Silicon Oasis (DSO), Abu Dhabi Global Market (ADGM), and Sharjah’s Hamriyah Free Zone. Here’s what businesses need to know:

Lower Licensing Fees: Several free zones have introduced discounts of up to 30% on new business license fees, making it cheaper to launch a company.
Longer License Validity: In a bid to support stability, business licenses can now be valid for up to 5 years in some free zones, reducing administrative burdens.
Zero Import/Export Duties: Many free zones already offer duty exemptions, but the latest updates strengthen and simplify these exemptions for a wider range of goods.
Reduced Office Rent: Free zones like Dubai Silicon Oasis and Sharjah Research Technology and Innovation Park have rolled out discounted commercial rents to help startups and SMEs manage their costs.
Easier Visa Quotas: Business owners will be allowed to sponsor more visas under flexible quotas, supporting the hiring of skilled workers from around the world.
Simplified Green Business Licensing: Several free zones have streamlined licensing processes for green and technology-driven businesses to encourage innovation in line with the UAE’s sustainability goals.

Support for Tech and Sustainability

The UAE has set a national priority on advanced technology and green industries, and free zones are aligning with this. For example, Dubai Internet City and Abu Dhabi’s KIZAD are offering tailored packages for AI, renewable energy, and cleantech startups, with incentives such as:

Subsidised co-working spaces
Fast-track licensing for climate-friendly businesses
Access to R&D grants and innovation competitions

These incentives aim to attract forward-thinking entrepreneurs who can help the UAE achieve its Net Zero by 2050 strategy and develop next-generation industries.

Attracting Global Investors

One of the UAE’s biggest advantages has always been its free zone ecosystem. There are more than 40 free zones across the Emirates, all competing to attract investment from Europe, Asia, and beyond. With this new round of incentives, the UAE is making a clear statement: it wants to remain the region’s top destination for doing business.

Free zone authorities are now also partnering with global trade organisations to promote their incentives abroad. For example, DMCC is working with business councils in India, China, and Africa to showcase the ease of setting up a company in Dubai, while offering one-on-one support for investors to navigate licensing, visas, and banking.

Ease of Doing Business

In addition to financial incentives, the UAE has prioritised making the business setup process smoother and faster. Free zones are investing in online platforms and digital portals to handle everything from licensing to visa applications. The goal is to reduce paperwork, avoid bureaucratic delays, and make setting up a business as seamless as possible.

For example, Dubai Airport Freezone (DAFZ) recently introduced a 100% digital onboarding process, letting entrepreneurs register their company, get approvals, and even open a bank account remotely.

Growing Opportunities for Startups

These updates come at a time when startups in the UAE are booming. The country recorded over 1,500 new startup registrations in the first quarter of 2025, according to government data. Many of these startups have chosen to launch in free zones because of their investor-friendly environment, tax benefits, and international networking opportunities.

Free zone authorities are also making a strong push to support women entrepreneurs and youth startups. Incentives include mentorship programmes, fee discounts, and access to co-working hubs designed to foster a collaborative and innovative ecosystem.

Competitive Tax Environment

While the UAE introduced corporate tax in 2023, free zones continue to offer significant tax advantages. Many free zone companies are exempt from paying corporate tax, provided they meet qualifying criteria. The new incentives reaffirm these benefits, ensuring that businesses operating in free zones can continue to enjoy zero or reduced tax rates while maintaining full foreign ownership and repatriation of profits.

A Long-Term Growth Vision

Industry experts believe these incentive updates will give a much-needed push to the UAE’s economic growth plans. The country aims to diversify its revenue away from oil and to develop world-class industries in trade, technology, logistics, renewable energy, and finance.

By improving its free zone incentives, the UAE is giving both global investors and local entrepreneurs the confidence to expand and innovate, which will create more jobs and support sustainable growth for the years ahead.

Final Thoughts

The UAE free zones have long been pillars of the country’s economic success. With these latest updates, they are becoming even more competitive, cost-effective, and future-ready. From reduced licensing fees to new support for green technologies, the fresh incentives are designed to help the UAE maintain its position as a top global business hub.

As the business world continues to evolve, the UAE’s focus on flexibility, digital transformation, and investor confidence will likely keep its free zones at the heart of regional and international trade for decades to come.