Comparison of Middle East freezone entities

Comparison of Middle East free-zone entities

Middle Easr free zones comparisonsUAE-RAKOmanJordanLebanonKuwait
Our ranking in order of preference12345
Summary at a Glance
Total year 1 engagement set up costs?US$14,850US30,000US$32,595US$17,860US$48,665
Total year 2 costs (incl. audit and tax)?US$10,200US$5,070US$14,620US$11,100US$14,840
Our Client must travel during the engagement?NoNoNoNoNo
Total engagement period?2 months3 months2 months3 months6 months
Corporation tax rate on net profits (click link)?000.140.150
Average monthly skilled labor salary (click link)?US$3,500US$4,000US$1,000US$600US$4,000
Average monthly office rental per sq m?US$65US$58US$25US$35US$35
Average monthly warehouse rental per sq m?US$30US$30US$7US$15US$10
Must be a 51% shareholder for trading businessNoNoNoNoNo
Must be a 51% shareholder for services businessNoNoNoNoNo
English language proficiency % of population?0.780.60.450.40.4
Incorporation requirements
How long to secure company registration number?1 month1 month1 month1 month3 months
Minimum number of shareholders?11132
Individual and corporate shareholders allowed?YesYesYesYesYes
Minimum number of directors?11111
Resident director required?NoNoNoNoNo
Minimum paid up share capital?US$1US$1US$70,650US$3,500US$36,000
Fast turnkey solution available (click link)?YesYesYesYesYes
Special permit or license required?NoNoNoNoNo
Corporate director(s) allowed?YesYesNoYesYes
Public register of shareholders & directors?YesYesYesYesYes
Tax and accounting considerations
Corporate tax payable?000.140.150
Withholding tax on dividends paid overseas00000
Annual financial statements required?YesYesYesYesYes
Statutory independent annual audit required?YesYesYesYesYes
Export taxes on goods and local GST or VAT?00000
Best holding company to extract dividends?Marshall IslandsSingaporeLabuanUAE-RAKMarshall Islands
Tax incentives for manufacturing start-ups?YesYesYesYesYes
Access to how many double tax treaties?N/AN/AN/AN/AN/A
Number of tax exempt free zones available?374821
GCC member (click link)?YesYesNoNoYes
Corporate bank account considerations
Healy Consultants’ preferred bank?Emirates NDBHSBCSCBHSBCKFH
How long to open corporate bank account?4 weeks3 weeks4 weeks4 weeks5 weeks
Do I travel to open the bank account?NoNoNoNoNo
Can open a US$ or £ or € bank account?YesYesYesYesYes
Good internet banking available?YesYesYesYesYes
Funds transfer currency controlsNoNoNoNoNo
Bank rating by World Economic Forum (click link)?3122572750
Ease of getting credit by WEF? score (1-7) (click link)39257645
Employment considerations
Average skilled labour monthly salary?US$3,100US$2,900US$1,500US$1,200US$4,000
Average unskilled labour monthly salary?US$1,000US$800US$500US$600US$1,500
Average pension/insurance benefits % of salary?0.050.105000
Minimum national salary?US$400US$600US$300US$450US$300
Mandatory labor unions?NoNoNoNoNo
Minimum notice to dismiss employees?1 month3 months3 months3 months3 months
Minimum redundancy indemnity?1 month1 month1 month1 month3 months
How long to get work permit approved?3-4 weeks4 weeks5-7 weeks6-9 weeks6 weeks
Manufacturing considerations
Cost per unit of electricity? US$0.040.030.230.020.003
Rank for getting electricity (click link)479445793
Warehousing space rental (per sq. m.)?US$20US$5US$7US$15US$10
Ranking for transport infrastructure (click link) (1-7 best)6.64.73.633.7
Ranking for customs procedures out of 10 (click link)?64.84.53.13.5
Average import duty % on raw materials?00000
Government incentives for startups?YesYesYesYesYes
Computer literacy % of population?0.90.850.90.90.85
Internet connectivity rating?StrongStrongStrongStrongStrong
Global business efficiency index (click link)?233354-43
Preferred manufacturing city?Ras Al KhaimahAl MazunahZarqaPort of BeirutKuwait FTZ
Proximity of sea port in kilometers?81136000
Proximity of airport in kilometers?9720083.419.116.9
Literacy % of population0.90.8140.9340.9390.94
Local purchasing power (GDP per capita)US$30,122US$29,813US$6,115US$14,845US$39,706
Local market size (in millions of people)93.26.54.53.9
Average annual inflation rate in 2014?0.0110.0130.0550.0320.027
Average unemployment rate in 2014?0.0380.080.1260.0660.031
Ease of doing business index (click link)226611710486
Country rating (click link)AAA-BB-B-AA
Logistics considerations
Monthly warehouse rental (per sq. m.)?US$20US$10US$25US$35US$15
Manufacturing space rental (sq. m.)?US$9US$5US$7US$15US$10
Can rent office outside free zones?YesYesNoYesNo
Can the entity hire local staff?YesYesYesYesYes
Average local monthly salary?US$2,500US$2,900US$2,600US$2,200US$4,000
Can the entity hire expatriate staff?YesYesYesYesYes
Free zone work permit fee per personUS$3,950US$3,950US$3,950US$3,950US$3,950
How long to get work permit approved?3-4 weeks2-3 weeks4-5 weeks3-5 weeks2-3 weeks

Contact us

For additional information on our Middle East company registration services, please email us at email@healyconsultants.com. Alternatively please contact our in-house country expert, Ms. Chrissi Zamora, directly:
client relationship officer - Chrissi