Peter J. Fort, the CEO of Ras Al Khaimah Free Trade Zone (RAK FTZ), speaks to My Startup World, about how entrepreneurs can register their company with the free trade zone, the licensing options available, the benefits of going with RAK FTZ, and more.
Tell us about Ras Al Khaimah.
Ras Al Khaimah is one of the seven emirates comprising the United Arab Emirates (UAE), along with Abu Dhabi and Dubai. With a reputation for a business-friendly investment environment and a competitive cost of establishing and operating companies, Ras Al Khaimah is a world-class investment destination where 12,000 businesses currently operate across nine free zone parks.
Companies operating in RAK free zones benefit from a completely tax-free environment, freedom to source labour and materials globally, and many other investment-support incentives.
What sort of licensing options are available at the Ras Al Khaimah Free Trade Zone?
The Ras Al Khaimah Free Trade Zone (RAK FTZ) offers the ideal solutions for aspiring entrepreneurs and current business owners to enter the Middle East market. We provide easy access to Africa, Europe, the Middle East and South Asia due to our strategic geographical location.
We offer commercial, general trading, consultancy/services and industrial licences. The free zone welcomes the establishment of new businesses as well as branches of existing organisations from outside of the free zone.
Are there any working capital requirements?
We are in the process of reviewing this requirement, and will be announcing the changes soon.
What sort of companies can register their entities with the RAK FTZ?
Companies of almost any size and type can register with the RAK FTZ. We are a hub for small and medium enterprises (SMEs) because of our convenient registration and cost-effective packages. Additionally, large companies such as Streit Group, the world’s largest armoured-vehicle manufacturer, have also found our services and facilities attractive enough to base their businesses inside the free zone.
We also provide tailored, tax-free business solutions to satisfy every company’s individual needs through our four specialised free zone parks. The Business Park is for our office clients, the Technology Park is for trading and light manufacturing, the Industrial Park is for heavy manufacturing, and the Academic Zone is for educational institutions.
At the RAK FTZ, a new business entity with a sole business owner can register as a Free Zone Establishment (FZE), while a new business entity owned by two to five partners can register as a Free Zone Company (FZC). Additionally, a branch of a domestic firm that has been operating in the UAE for more than a year is eligible to open a local branch, and a branch of a foreign firm that has been operating outside of the country for more than a year is eligible to register as a foreign branch. This also applies to a subsidiary company.
What sort of benefits does the RAK FTZ offer in comparison to other free zones in the UAE?
At the RAK FTZ, we offer tax-free, award-winning service as well as the same benefits as other free zones – including 100 per cent foreign ownership, no capital restrictions, full repatriation of profits and fast-tracking of visas – but at a much lower cost. The cost of living and doing business in Ras Al Khaimah is substantially lower than in other emirates.
That’s why setting up a business here can produce a much greater return on investment. Another advantage that sets us apart from other free zones is the freedom to build labour accommodations on site, which eliminates the need for labour transportation along with its associated risks and costs.
Additionally, we are less than an hour’s drive from Dubai’s business and financial centres, with close proximity to international airports and sea ports. Multi-lane super-highways connect RAK to other emirates and neighbouring countries. Companies can profit from fast-growing economies in RAK and the rest of the UAE, including the upcoming World Expo 2020.
Finally, we have been recognised by our clients as one of the fastest, most effective and hassle-free free zones in the UAE.
What sort of benefit does the RAK FTZ offer in comparison to registering a company through the economic department?
The free zone allows you to own 100 per cent of your business, and provides comprehensive packages that include everything an investor needs to set up operations, free of all taxation. This includes your licence, visas and company registration – all done on a fast-track basis that reduces bureaucratic requirements – as well as ready-made facilities such as offices, warehouses and land for development.
Among our offerings are flexi-facilities designed under the startup incubator concept. These facilities include networked work stations that allow business owners to share computers, phones and desks with low overhead costs, to help them get started in business.
We also provide support for opening UAE bank accounts. Additionally, our Mazeed service desk provides further business support, including insurance, advertising, event management training and other services.
Also, in the free zone there are no restrictions on profits or on capital repatriation, along with zero corporate, personal income or sales taxes. There is also no customs or import duty on re-exported goods, as well as flexible labour rules and the ability to source employees globally.
Additionally, we offer a well-established infrastructure, support services, access to the RAK FTZ’s international marketing office network and state-of-the art communications facilities. Our business support services provide a comprehensive array of advantages that make it quick and easy to set up a company.
What do entrepreneurs need to know prior to setting up their company through the RAK FTZ?
The requirements for our business clients vary from case to case. Some of the requirements, depending on the type of licence, might include a minimum capital investment, a university degree, an experience certificate, a no-objection letter and other documentation. A pre-approval from the immigration authority is needed in all cases.
Does the RAK FTZ offer incubation/acceleration programmes for upcoming start-ups/entrepreneurs who do not have enough funds to set up operations?
Potential business owners must have sufficient capital to set up their companies. We can help them get started with a wide array of support services, such as liaising with banks with which we have a relationship, in order to provide financing packages and assist entrepreneurs in setting up at the RAK FTZ.
We are also evaluating the feasibility of establishing an equity growth fund for SMEs.
How does the RAK FTZ help the entrepreneurship ecosystem in the Middle East? Does it offer any mentoring sessions for budding entrepreneurs?
Under the RAK FTZ Knowledge Series programme, the RAK FTZ organises events for its clients, aiming to provide first-hand information and insight into the challenges and opportunities of doing business in the Middle East. We give entrepreneurs the opportunity to listen to industry experts and get their advice on various subjects.
The events are held regularly during the year in order to provide our clients with in-depth knowledge and expertise in a round-table environment to foster networking and to share best practices, ideas and tools. We also organise networking evenings for the entrepreneurs.
Is there any other information you would like to add?
The RAK FTZ is one of the fastest-growing and most cost-effective free trade zones in the UAE. With a reputation for zero taxes, affordability, flexibility and broad geographical reach, the free zone is becoming the preferred business hub in the region.
Since it was established in May 2000, the RAK FTZ has gone from strength to strength, garnering accolades and awards along the way. With only a handful of staff and a few offices in its first year, the RAK FTZ is now home to more than 7,500 active companies from more than 100 countries around the world.
It employs more than 350 full-time staff, operates business and promotion centres in Abu Dhabi, Dubai and Ras Al Khaimah in the UAE, and has an expanding international presence, with liaison offices in Germany, Turkey and India.
In 2013, we substantially increased our new-company registrations over the previous year, and – now that the Dubai World Expo 2020 is attracting more international investors to the UAE – we are expecting an even better year in 2014.
