Hamriyah is located on the west coast of Sharjah. Because of the deepwater port and import/export orientated infrastructure, international entrepreneurs setting up a Free Zone Establishment (FZE), or Free Zone Company (FZC), primarily for international trading activities. Low annual license fees make it particularly attractive to manufacturing companies and service providers. The following information enables entrepreneurs to make an informed decision on whether Hamriyah FZ company is the optimum solution to fulfill international business objectives.

Hamriyah company registration summary

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• Advantages and disadvantages

  Advantages of Hamriyah company registration

  

  • Incorporating in the Hamriyah Free Zone can be advantageous for our Clients because:
    • Hamriyah FZ laws do not require a UAE national to hold shares in locally incorporated entities. As a result, these entities can be wholly owned by foreigners. Furthermore, there are no restrictions on the repatriation of capital or profits from the country;
    • If properly structured, Hamriyah FZ company is the perfect way to legitimately book international profits without paying local corporation tax. There is neither any corporate tax nor personal income tax levied in Sharjah. Furthermore, there are no requirements for the company to prepare annual financial statements or file tax returns to any authorities, making the entity easy to manage;
    • Hamriyah company registration is cost effective when compared with other UAE free zones, often taking only 24 hours with the correct documentation. For example, the business registration fee in Hamriyah for a Free Zone Establishment (FZE) is DHS9,000 (US$2,450).Furthermore, ongoing business costs are also competitive. Annual license fees amount to a maximum of US$3,250 for a trading company, compared with more than US$8,000 in Jebel Ali Free Zone;
    • International entrepreneurs setting up a business in Hamriyah obtain a 25 year land lease which is renewable for another 25 years, thereby guaranteeing 50 years’ legitimate tax exempt operations, with pre-built warehouses, factories, and office units for lease, coupled with established communications infrastructure for the modern age;
    • Companies will obtain one of the following licenses for their Hamriyah FZ company: i) Industrial License ii) Services License and iii) Commercial License. Holders of an Industrial or Commercial license require a local distributor or agent for their products to be sold in the UAE. A holder of a Service license may only conduct the services stipulated on the license within the free zone. Companies may also apply for the National Industrial License, which will allow them to operate as a local, or an AGCC entity, within the UAE. This license allows customs duty exemptions on imports but must meet specific conditions including 51% ownership by an AGCC citizen;
    • A large emphasis is put on the nurturing of small and medium sized enterprises(SMEs). A ‘Hamriyah SME Zone’ has been setup which consists of seven strategic clusters to promote the development of SMEs. Programs have been developed, such as the E-office package, to provide SMEs with individual tailored assistance to commence business and operate successfully. For more information, visit the official HFZA website;
  • The Hamriyah Free Zone still has a good geographical location that allows the companies incorporated in the zone to serve across three continents of Middle East, Africa and Europe, which is a growing market of 1.5 billion consumers.

  Disadvantages of Hamriyah company registration

  • Establishing a Free Zone Establishment (FZE) or an Free Zone Company (FZC) in Sharjah requires a minimum capital of AED150,000 (approx. US$41,000) but there is no minimum capital required when setting up a branch of a foreign/local company;
  • A minimum of two directors and one secretary are needed for setting up a FZE/FZC. HFZA may also require that such persons hold a valid residence or work permit. At least one director and the secretary must be residents;
  • Sharjah does not enjoy the global image and reputation of Dubai. Consequently, Hamriyah FZ company registration may not be the best solution for international entrepreneurs for whom corporate image is important;
  • Due to its location, Hamriyah is less popular among many international entrepreneurs due to the lack of quality accommodation compared to Dubai. International entrepreneurs setting up business in Hamriyah and living in Dubai face heavy peak hour traffic;
  • Entities strictly incorporated in Hamriyah Free Zone cannot conduct commercial activities within Sharjah as well as the rest of UAE;
  • All companies registered in the UAE must i) create and maintain a register of their ultimate beneficial ownership (UBO) and ii) submit UBO data to the relevant registrar or licensing authority;
  • In 2020, the UAE introduced new regulations requiring all UAE companies to maintain and submit registers of their i) Ultimate Beneficial Owners (UBOs) or Real Beneficiaries ii) shareholders and iii) directors. Fortunately, information contained within company registers is kept confidential by the authorities.

• Best uses for a Hamriyah company

  Continental connector

  • The HFZA is in a unique geographical position, with access to the Arabian Gulf and the Indian Ocean, beside three world class seaports providing access to both western and eastern economies. An international airport is also accessible, which connects to 230 cities, considering itself as a gateway between three continents, and the emerging markets throughout Asia and Africa.