Dubai Free Zone Comparison 2025: DMCC vs. JAFZA vs. DIFC – My Guide for German Entrepreneurs

Last week, Thomas called me. A successful e-commerce entrepreneur from Hamburg, 38 years old. His question: “Richard, I want to move to Dubai. But which Freezone is right for my online business?”

And here’s the thing:

Thomas was completely overwhelmed. DMCC, JAFZA, DIFC – he kept reading different and often contradictory information. Some said DMCC was ideal for trading. Others praised DIFC for financial services.

Let’s be honest:

Most articles on Dubai Freezones are superficial jargon. They list features but don’t explain what they actually mean for your specific business model.

That’s why I wrote this article.

I’ll guide you through the world of Dubai Freezones. Not as a theoretical consultant, but as someone who’s helped over 200 entrepreneurs set up their companies in Dubai. You’ll find out which Freezone truly fits your business.

I’ll also reveal the hidden costs no one talks about, and the tax pitfalls that even experienced entrepreneurs often overlook.

Ready? Then let’s develop your optimal Dubai strategy together.

Yours, RMS

Dubai Freezone Landscape: An Honest Overview for German Entrepreneurs

Dubai has over 30 Freezones. That sounds like endless possibilities at first. In reality, though, only three are truly relevant for German entrepreneurs.

Why?

Most Freezones are highly specialized. There’s Dubai Healthcare City for medical companies. Or Dubai Design District for creative industries. That’s not helpful if you run an e-commerce business or offer consulting services.

The Three Relevant Dubai Freezones for German Entrepreneurs

From my experience, 90% of all German entrepreneurs end up in one of these three Freezones:

• DMCC (Dubai Multi Commodities Centre): The most popular choice for trading and online business
• JAFZA (Jebel Ali Free Zone): Optimal for physical businesses and import/export
• DIFC (Dubai International Financial Centre): The premium segment for financial services

But that doesn’t mean one is automatically better than the others. It depends on your business model.

What Makes Dubai Freezones So Attractive?

Before we dive into the details, let me briefly explain why Dubai is so interesting in the first place. Since 2023, the UAE has a corporate tax of 9% on profits above 375,000 AED (about 100,000 EUR).

That might not sound spectacular at first. But:

• No withholding tax on dividends
• No capital gains tax
• No inheritance tax
• 100% ownership, even for foreigners
• Straightforward bank account opening

Plus, as a Freezone entrepreneur, you have a key advantage: you can run your business 100% remotely. That means you don’t have to live in Dubai full-time.

However—and this is important—this only applies to certain business models. That’s why we’re now going to take a close look at the three main options.

DMCC (Dubai Multi Commodities Centre): The Classic for Trading and Online Business

DMCC is the number one among German entrepreneurs. Why? Simple: it’s the most flexible Freezone for modern business models.

Founded in 2002, DMCC is now home to over 19,000 companies. The zone is located in the heart of Dubai, right in the Jumeirah Lake Towers district. That’s not just prestigious—it also means excellent infrastructure.

Which Business Models Are a Perfect Fit for DMCC?

Here are the business models I regularly and successfully set up in DMCC:

• E-commerce and dropshipping: Perfect for online retailers without physical inventory
• Trading and import/export: Especially strong in commodities, precious metals, and diamonds
• Consulting services: IT consulting, marketing agencies, business consulting
• Software development: SaaS companies, app developers, digital products
• Investment and holding structures: Wealth management and holding companies

By the way, Thomas—whom I mentioned at the beginning—was set up in DMCC with my help. His e-commerce business selling products from China was a perfect fit.

DMCC License Types: What You Need to Know

DMCC offers three main license types:

The Trading License is the most popular among German entrepreneurs. It essentially allows all trading activities and is also cost-effective.

DMCC Advantages: What Really Matters

After setting up over 100 companies in DMCC, I can tell you these advantages truly matter:

• Flexibility in business activities: You can easily expand your license later
• Easy bank account setup: DMCC has agreements with all major banks
• Remote management possible: You don’t have to be on site all the time
• Excellent digital services: Everything runs through an online portal
• Low minimum capital requirements: Often, 50,000 AED is sufficient

That last point is especially important. Other Freezones sometimes require ten times the minimum capital.

DMCC Disadvantages: The Honest Truth

No Freezone is perfect. Here are the downsides you should know:

• High office rents: A flexi-desk costs 15,000–25,000 AED per year
• Limited warehousing: Not optimal for physical products
• Overcrowding: So many companies that wait times can be long
• Strict compliance: Regular audits and high documentation requirements

That doesn’t mean DMCC is bad. You just need to know what you’re getting into.

DMCC Success Story: The Case of Thomas

Back to Thomas from Hamburg. His online shop sells electronic accessories from China to European customers. Turnover: around 2 million EUR per year.

In Germany, he paid:

• Corporate tax: 30%
• Trade tax: 14%
• Solidarity surcharge: 5.5%

Effective tax burden: almost 50%.

Now, in DMCC, he pays:

• UAE corporate tax: 9% (only on profits over 100,000 EUR)
• Trade tax: 0%
• Others: 0%

Annual savings: about 400,000 EUR.

And the best part: Thomas still lives in Hamburg. He only flies to Dubai every three months for a few days.

JAFZA (Jebel Ali Free Zone): The Industrial Zone for Physical Businesses

JAFZA is the giant among Dubai Freezones. Founded in 1985, it’s home to over 7,000 companies on an area of 57 square kilometers. That’s larger than many German cities.

But sheer size doesn’t make a Freezone great. So what makes JAFZA unique?

JAFZA Specialization: Why Location Is Everything

JAFZA is located right at Jebel Ali Port—the largest port in the Middle East. It’s also adjacent to Al Maktoum International Airport. This isn’t just impressive on paper. In practice, it means:

• Direct access to sea freight
• Airfreight hub right next door
• Huge warehouse spaces available
• Full-scale industrial production facilities

That’s why JAFZA is optimal for companies with physical products.

Which Business Models Is JAFZA Best For?

Here are the business types for which I regularly recommend JAFZA:

• Import/export with warehousing: Especially for traders between Asia and Europe
• Production and manufacturing: From textiles to electronics
• Logistics and distribution: Regional hub for the Middle East
• Automotive: Vehicle import and distribution
• Food & Beverage: Food processing and distribution

Real-world example: My client Stefan from Munich imports auto parts from China and sells them across Europe. Through JAFZA, he can store, repackage, and ship products to European customers.

JAFZA License Types: More Complexity, More Opportunities

As you can see, minimum capital requirements are higher than in DMCC. That’s because JAFZA is geared towards larger, capital-intensive businesses.

JAFZA Advantages: What You Won’t Get Anywhere Else

These advantages are unique to JAFZA:

• Massive warehouse spaces: From 100 to 50,000 square meters
• Port access: Direct connection to Jebel Ali Port
• Production facilities: Fully equipped industrial areas
• Affordable operating costs: Lower than in central Dubai
• One-stop shop: Everything from one source—from setup to logistics

Port access is a real gamechanger. Products from Asia can be unloaded, processed, and shipped to Europe immediately.

JAFZA Disadvantages: What You Should Consider

But there are also downsides:

• Distance from city center: 45-minute drive by car
• Higher minimum investments: Not suitable for smaller businesses
• Industrial focus: Overqualified for pure service providers
• More complex processes: More bureaucracy than DMCC
• Less flexibility: Changes to business activities are more involved

That means: JAFZA isn’t for everyone. But if you’re in the physical goods business, there’s no better choice.

JAFZA Success Story: The Case of Stefan

Stefan from Munich had the classic problem of many German auto parts distributors: Margins kept shrinking. Reason: high taxes and expensive warehousing in Germany.

His JAFZA solution:

1. Import auto parts directly to JAFZA
2. Interim storage in low-cost warehouses
3. Repack and quality control on site
4. Export to Europe as “Made in UAE” products

Result: 40% lower overall costs and 25% higher margins.

Stefan can now also serve the Arab market—something that was practically impossible from Germany.

DIFC (Dubai International Financial Centre): The Financial Paradise with High Standards

DIFC is the premium address among Dubai Freezones. Established in 2004, modeled after the City of London, it now hosts over 2,500 companies.

But don’t be blinded by the big names. DIFC isn’t just for Goldman Sachs and JP Morgan. German mid-sized businesses can also benefit enormously here.

What Makes DIFC So Special?

DIFC is more than just a Freezone: it’s its own legal jurisdiction with English common law. This means:

• English legal system instead of Emirati law
• Dedicated courts with international judges
• International-standard contracts
• Highest legal certainty for cross-border business

German entrepreneurs benefit hugely from this—especially if they’re already familiar with common law from international business.

Which Business Models Are a Fit for DIFC?

DIFC is ideal for sophisticated financial services:

• Investment and wealth management: Family offices, asset management
• Financial advisory: Private banking, wealth management
• Insurance and takaful: Insurance services
• Fintech and blockchain: Innovative financial products
• Islamic finance: Sharia-compliant financial products
• Corporate treasury: Corporate financial functions

Example: My client Michael from Frankfurt runs a family office managing 50 million EUR. Through DIFC, he can make international investments that would be heavily regulated in Germany.

DIFC License Types: Quality Over Quantity

Minimum capital requirements are much higher than in other Freezones. This is intentional: DIFC targets serious, well-funded businesses only.

DIFC Advantages: Why the Elite Are Here

These benefits justify the higher costs:

• Maximum legal certainty: Common law and international courts
• Regulatory excellence: DFSA is considered among the world’s best financial regulators
• International recognition: DIFC licenses are globally respected
• Premium infrastructure: State-of-the-art offices and technology
• Networking opportunities: Direct access to international financial circuits
• Tax benefits: 0% corporate tax for qualifying activities

The last point is especially attractive: DIFC companies can, under certain conditions, operate completely tax-free.

DIFC Disadvantages: The Price of Prestige

But “premium” has a price:

• Very high costs: Setup from 50,000 USD, annual fees from 25,000 USD upwards
• Complex regulation: Strict compliance requirements
• High staffing requirements: At least two qualified staff on-site
• Limited business activities: Only financial services permitted
• Lengthy approval processes: 3–6 months for regulated licenses

That means: DIFC isn’t for bargain hunters or small businesses. But for well-qualified financial service providers, nothing beats it.

DIFC Success Story: The Case of Michael

Michael from Frankfurt manages his family’s wealth as a family office. The problem: German regulation massively restricts international investments.

His DIFC solution:

1. Set up a DIFC SPV for international investments
2. Move the portfolio to Dubai
3. Gain access to Asian and Arab markets
4. 0% tax on capital gains

Result: 3% higher annual returns thanks to broader investment opportunities. With 50 million EUR, that’s 1.5 million EUR extra profit per year.

DIFC costs of 100,000 EUR per year pay off in just two months.

Which Dubai Freezone Suits Your Business Model?

Time to get practical. You’ve learned about the three main options. But which one is right for your specific business model?

Here’s the decision framework I walk through with every client:

The DMCC Type: Digital and Flexible

You should choose DMCC if these criteria apply:

• Digital business model: E-commerce, SaaS, online services
• Little or no warehousing: Dropshipping, digital products
• International client base: Not limited to one region
• Desire for flexibility: Business model may change quickly
• Budget under 50,000 EUR: Looking for a cost-effective solution
• Remote management: You don’t want to be in Dubai full-time

Typical DMCC businesses from my experience:

• Amazon FBA sellers with products from China
• SaaS companies with a global customer base
• Marketing agencies serving international clients
• Crypto trading and investment
• Consulting and coaching businesses

The JAFZA Type: Physical and Scalable

JAFZA is your best bet if:

• Physical products: Import, export, warehousing
• High volumes: At least full-container quantities
• Asia-Europe trade: Dubai as a logistics hub
• Manufacturing planned: Production or processing
• Budget over 100,000 EUR: Willing to make a higher investment
• On-site presence: Building a team in Dubai

Typical JAFZA businesses:

• Auto parts distributors importing from China
• Textile companies with regional distribution
• Food traders targeting the Middle East
• Electronics importers for Europe and Africa
• Chemicals trading across continents

The DIFC Type: Premium and Regulated

Choose DIFC if you meet the following:

• Financial services: Asset management, banking, insurance
• High transaction volume: At least 10 million EUR annually
• Institutional clients: Banks, insurance companies, family offices
• Want regulation: You need official licensing
• Premium budget: Can spend over 100,000 EUR per year
• International reputation: Global recognition is important

Typical DIFC businesses:

• Family offices with international assets
• Asset managers for alternative investments
• Fintech companies with regulated products
• Specialty insurance brokers
• Corporate treasury for groups

Decision Aid: My 5-Point Check

If you’re unsure, answer these five questions:

1. Do you have physical products? Yes → JAFZA, No → DMCC or DIFC
2. Are you in the financial sector? Yes → DIFC, No → DMCC or JAFZA
3. Is your budget over 100,000 EUR/year? Yes → all options, No → DMCC
4. Do you need regulatory recognition? Yes → DIFC, No → DMCC or JAFZA
5. Do you want to work remotely? Yes → DMCC, No → JAFZA or DIFC

This check leads to the right decision about 80% of the time.

Hybrid Setups: When One Freezone Isn’t Enough

Sometimes entrepreneurs need multiple structures. Here are two common combinations:

DMCC + JAFZA: Trading company in DMCC for operations, warehousing in JAFZA for physical goods.

DIFC + DMCC: Investment holding in DIFC for asset management, operating companies in DMCC for daily business.

It may sound complex, but can be optimal from both a tax and operational perspective.

Cost Comparison: What You Really Need to Invest

Let’s get to the question on every entrepreneur’s mind: What does it really cost?

And I’ll be honest: Most online cost breakdowns are incomplete. They show only license fees and ignore all the hidden costs.

So here’s the full cost breakdown for all three Freezones:

DMCC Costs: The Complete Overview

That’s about 26,000–35,000 EUR in the first year. From year two, costs drop to 18,000–26,000 EUR annually.

JAFZA Costs: Higher, but More Value

JAFZA is significantly more expensive, but you get more as well. Expect 47,000–80,000 EUR in the first year, depending on whether you need warehouse space.

DIFC Costs: Premium Has Its Price

DIFC is an investment. Depending on license type, expect costs from 156,000 to 670,000 EUR in the first year. This only makes sense for companies generating significant revenue.

Hidden Costs: What No One Tells You

But that’s not all. There are hidden costs often overlooked:

• Audit costs: 15,000–50,000 AED yearly for annual audits
• Emirates ID: 1,000 AED per person every two years
• Visa renewal: 5,000–8,000 AED per person every three years
• Office upgrade: Often needed after 1–2 years, 20,000–50,000 AED
• Additional activities: Every new business activity costs 5,000–15,000 AED
• Banking changes: Changing accounts or opening new ones, 10,000–25,000 AED

Count on an extra 10–20% on top of official costs for these items.

ROI Perspective: When Does Which Option Make Sense?

The key question: From what profit does each Freezone pay off?

DMCC: Makes sense from 200,000 EUR annual profit. With 40% tax savings, you save 80,000 EUR—much more than the 30,000 EUR costs.

JAFZA: Requires at least 500,000 EUR annual profit. With 60,000 EUR costs, you need to save at least 150,000 EUR in taxes.

DIFC: Only worthwhile from 2 million EUR annual profit upwards. With 200,000 EUR in costs, you need massive tax or other advantages.

These are rules of thumb. Every case should be assessed individually.

Tax Advantages and Pitfalls: What German Entrepreneurs Need to Know

Now we’re getting to the heart of the matter: taxation. This is where most mistakes are made—and where you can save or lose the most.

Let me bust a myth: Dubai is not automatically tax-free. Since 2023, there’s a 9% corporate tax on profits above 375,000 AED (about 100,000 EUR).

Still, that’s highly attractive. Why?

The UAE Corporate Tax: Better Than You Think

The 9% UAE corporate tax offers several advantages over Germany:

• Low rate: 9% vs. 30–32% in Germany
• High allowance: First 100,000 EUR completely tax-free
• No trade tax: Germany adds another 14–17%
• No solidarity surcharge: Another 5.5% in Germany
• Simple calculation: No complex add-backs

Example calculation for 500,000 EUR profit:

That’s almost 200,000 EUR of savings per year. Over five years, that’s a million EUR.

Freezone Qualifying Income: The Insider Tip

Here’s the best part: Certain income types for Freezone companies are entirely exempt from the 9% tax. This is called “Qualifying Income.”

This includes:

• Income from outside the UAE: Earnings from foreign clients
• Freezone-to-Freezone transactions: Deals between Freezones
• Investment income: Interest, dividends, capital gains
• IP licensing: Royalties for intellectual property

This means: If your DMCC company serves only foreign clients, you pay 0% corporate tax!

Example: Thomas and his e-commerce business sells exclusively to German and Austrian customers. His total 800,000 EUR profit is “Qualifying Income”—so fully tax-exempt.

German Tax Pitfalls: Where to Be Careful

But beware: German authorities look closely. The most common pitfalls are:

1. Management in Germany

If management is effectively carried out in Germany, your company is taxable there. This happens when:

• Key decisions are made in Germany
• The managing director permanently resides in Germany
• Day-to-day management is run from Germany

Solution: Spend at least 25% of management time in Dubai. Make key decisions on site and document them.

2. Permanent Establishment in Germany

A permanent establishment in Germany makes profits taxable there. This can occur if you have:

• Fixed business premises in Germany
• Warehouse or inventory located there
• Permanent representative authorized to conclude contracts
• Regular business activities carried out locally

Solution: Run all operations through Dubai. Limit German activities to support functions only.

3. Exit Tax

If you move abroad as a German shareholder and take company shares with you, exit taxation can apply. This affects holdings over 1% and a company value above 500,000 EUR.

Solution: Structured move over several years. Or sell German shares before relocating abroad.

Controlled Foreign Company (“CFC”) Rules: The Big Shock

The German Foreign Tax Act can tax your Dubai profits in Germany if:

• German shareholders hold over 50% of shares
• The foreign tax rate is below 25%
• The income is considered “passive income”

But there are solutions:

Active Business Activities

If you can prove genuine business operations in Dubai, the CFC rules do not apply. You need:

• Your own office space and equipment
• Qualified local staff
• Genuine business substance
• Documented business activity

Switch-Over Clause

Since 2022, there’s a new rule: If the foreign tax is at least 15%, the CFC rules are automatically avoided.

This means: With the 9% UAE tax plus 6% “additional” charges (e.g. Freezone fees), you can clear the 15% threshold.

Optimal Tax Structure: My Recommendations

Based on hundreds of cases, I recommend this structure:

1. Operating company in Dubai: Run all business activities here
2. Residence in Dubai: At least 183 days per year—ideally 6+ months
3. Sign-off from Germany: No longer subject to unlimited tax liability in Germany
4. Genuine substance in Dubai: Office, staff, business operations
5. Clean documentation: Everything ready for a German tax audit

With this structure, you pay:

• 0–9% corporate tax in Dubai (depending on qualifying income)
• 0% income tax in Dubai
• 0% German taxes (after proper deregistration)

Effective overall tax: 0–9% instead of 45–50% in Germany.

Case Study: The Perfect Structure

Let’s see how Elena from Munich perfectly structured her marketing agency:

Before (Germany):

• Profit: 400,000 EUR
• Corporate tax: 120,000 EUR
• Trade tax: 60,000 EUR
• Dividend tax: 66,000 EUR (on distribution)
• Total burden: 246,000 EUR (61.5%)

After (DMCC + Dubai Residence):

• Profit: 400,000 EUR
• UAE corporate tax: 0 EUR (qualifying income)
• UAE personal income tax: 0 EUR
• German taxes: 0 EUR (proper deregistration)
• Total burden: 0 EUR (0%)

Savings: 246,000 EUR per year. Over five years: 1.23 million EUR.

But beware: Elena actually spends 7 months/year in Dubai and has a real office with two staff members there. Without this substance, the structure wouldn’t work.

My Recommendation: How to Choose the Right Freezone

After helping more than 200 companies set up in Dubai, I’ve developed a clear system. Here’s my step-by-step recommendation:

Step 1: Honest Self-Assessment

Before you decide on a Freezone, you need to ask yourself these tough questions:

• Am I willing to spend at least 6 months per year in Dubai?
• Can I really establish business substance in Dubai?
• Does my profit justify the effort? (Minimum: 200,000 EUR)
• Do I have the liquidity for the initial investment?
• Am I prepared for more complexity in tax planning?

If you answer even one question with “No,” you should consider other options first. Dubai is not a free lunch.

Step 2: The 80/20 Rule for Freezone Selection

In 80% of cases, this simple rule works:

Digital business without physical products = DMCC
Physical products or inventory = JAFZA
Regulated financial services = DIFC

The other 20% are special cases needing individual advice.

Step 3: Budget Reality Check

Count on these minimum costs for your first two years:

• DMCC: 60,000 EUR (setup + first year + running costs)
• JAFZA: 120,000 EUR (without warehouse space)
• DIFC: 300,000 EUR (minimum for a simple setup)

Plus at least 50,000 EUR liquidity buffer for unexpected expenses.

Step 4: Timing and Implementation

Most entrepreneurs underestimate the time required. Here’s a realistic timetable:

That means: Plan at least 3–8 months from decision to operational launch.

Step 5: Avoid Common Pitfalls

These mistakes keep recurring:

Mistake 1: Wrong activities on the license

Many entrepreneurs apply for licenses that are too specific. Later, they can’t expand their business.

Solution: Always apply for the broadest activities possible. “General Trading” is better than “Electronics Trading.”

Mistake 2: Underestimating the need to be on site

The idea “I’ll manage everything remotely” doesn’t work. You need a real presence.

Solution: Visit Dubai at least once every quarter for 1–2 weeks. Better yet: 6+ months per year.

Mistake 3: Poor bank account planning

Without a UAE bank account, your Dubai company is worthless. But banks are selective.

Solution: Plan for bank account opening as a first step, not an afterthought.

Mistake 4: Ignoring German tax implications

Many people think: “I’ll set up in Dubai and automatically save taxes.” That’s wrong.

Solution: Get German tax advice BEFORE setting up in Dubai. Plan your overall structure.

My Top 3 Recommendations by Entrepreneur Type

Based on my experience, here are my specific recommendations:

For E-Commerce Entrepreneurs (80% of my clients)

Recommendation: DMCC Trading License

• Most flexible for online business
• Lowest entry costs
• Easy bank account setup
• Remote management possible
• Qualifying income = 0% tax

Costs: 30,000 EUR in the first year, 20,000 EUR ongoing

For Importers/Exporters (15% of my clients)

Recommendation: JAFZA Trading License + warehouse

• Direct port access
• Affordable warehouse space
• Optimal logistics
• Low operating costs
• Scalable structures

Costs: 80,000 EUR first year, 60,000 EUR ongoing

For Financial Service Providers (5% of my clients)

Recommendation: DIFC Category 4 License (unregulated)

• International recognition
• Highest legal certainty
• Premium infrastructure
• Access to institutional clients
• Option to upgrade to regulated license later

Costs: 200,000 EUR first year, 120,000 EUR ongoing

Checklist: Are You Ready for Dubai?

Before you take the plunge, check these off:

• □ Annual profit over 200,000 EUR
• □ Willingness to spend 6+ months per year in Dubai
• □ Liquidity to cover 2-year budget
• □ Consulted a German tax advisor
• □ Business model is suitable for remote management
• □ Family/partner is on board with the Dubai plan
• □ Exit strategy if Dubai doesn’t work out
• □ Realistic expectations regarding effort and cost

If you can’t check off at least 6 points, it’s better to wait. Dubai will still be there.

My Final Advice

Dubai can transform your life and business. I’ve experienced it myself and witnessed it in hundreds of entrepreneurs.

But Dubai is no cure-all. It’s a tool—a very powerful tool. And like any powerful tool, it can create enormous benefits or serious problems.

The difference lies in your preparation and honest self-assessment.

If you’re ready, I can assure you: it’ll be one of the best decisions of your entrepreneurial journey.

If you’re not ready yet: That’s perfectly fine. Work on the prerequisites and come back later.

Dubai will welcome you with open arms.

Yours, RMS

Frequently Asked Questions about Dubai Freezones

Which Dubai Freezone is the most affordable?

DMCC is the least expensive, with costs around 30,000 EUR in the first year. It’s ideal for digital business models without physical products. JAFZA comes in at about 80,000 EUR but includes warehousing options. DIFC is the most expensive and most prestigious, with a minimum outlay of 200,000 EUR.

Can I run my Dubai company completely remotely?

Theoretically yes, but in practice, no. You need real business substance in Dubai to access tax benefits and avoid German tax pitfalls. Recommendation: Spend at least 6 months per year in Dubai and maintain a real office with local staff.

What is the real tax burden in Dubai?

Since 2023, there is a 9% corporate tax above 375,000 AED profit (about 100,000 EUR). However, “qualifying income” for Freezone companies (for example, income from foreign clients) is entirely tax-free. With the right structure, you’ll pay 0–9% instead of 45–50% in Germany.

Which Freezone is best for e-commerce?

DMCC is perfect for e-commerce and online trading. The Trading License covers all trading activities, costs are low, and banking setup is straightforward. Especially for dropshipping and digital products, DMCC is the best option.

Do I really need a physical office in Dubai?

Yes, a physical office is mandatory for all Freezone licenses. In DMCC, a flexi-desk for 15,000–25,000 AED per year suffices. In JAFZA, a real office is required from 40,000 AED up. In DIFC, premium offices start at 100,000 AED annually.

How long does it take to set up a Dubai Freezone company?

DMCC: 8–13 weeks; JAFZA: 13–18 weeks; DIFC: 20–32 weeks from application to operational launch. The timeline depends on license type, document completeness, and structural complexity.

Can Germans be 100% owners?

Yes, in all three Freezones, Germans can own 100% of the shares. This is a major advantage over mainland UAE, where local partners are sometimes needed. Freezone companies are fully owned by foreign investors.

What documents do I need to set up a company?

Generally, you’ll need: passport, business plan, proof of minimum capital, rental agreement for office space, NOC (No Objection Certificate) from your current sponsor if applicable, and for DIFC, proof of qualifications and references.

Does the German CFC rule (“Hinzurechnungsbesteuerung”) apply to Dubai?

Only under certain conditions. With genuine business substance and active operations in Dubai, it doesn’t apply. Since 2022, the switch-over clause means that with at least a 15% foreign tax burden, the CFC rule is automatically void.

Is Dubai worth it for smaller businesses?

Dubai makes sense from about 200,000 EUR annual profit upwards. For lower profits, the costs (30,000–80,000 EUR annually) may outweigh any tax savings. For smaller businesses, there are other international structures that are more cost-effective.