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FAQs: Fujairah Creative Freezone

Published on : 16 Dec 2020

Fujairah Creative Freezone

1. What law established this freezone?

Fujairah Emiri Decree No. 4/2007 established Fujairah Creative City (FCC).

2. What are the main internal regulations governing this freezone?

The Fujairah Free Zone Authority sets the regulations governing FCC Free Zone.

3. Does this freezone have any reciprocal arrangements with other freezones?

Dubai Law No. 13/2015 established the Dubai Free Zones Council which provides for the enhancement of cooperation between freezones.

4. What are the key areas of UAE and Emirate legislation businesses operating in this freezone must still comply with? What are the most important examples of how this impacts operations?

In situations where FCC rules and regulations do not apply, UAE legislation will apply. Numerous UAE legislations and mandatory industry standards, depending on the business activity, also need to be complied with by any business operating in FCC freezone.

For example, when FCC rules and regulations do not apply, Federal Law No. 11/1992, the Civil Procedure Code, Federal Law No. 18/1993, the Commercial Transactions Law, and Federal Law No. 2/2015, the Commercial Companies Law, will apply.

5. What are the key UAE and Emirate onshore agencies a business operating in this freezone would need to register or comply with?

Freezone companies are generally limited to the activities stated on their license. If a freezone company wants to carry out operations beyond the limitations stipulated in its license, it will need to comply with the requirements of Federal Law No. 2 /2015, the Commercial Companies Law, which determines the licensing procedure in the required Emirate.

The FCC Authorities provide assistance dealing with the federal ministries to obtain driving licenses, car registrations, securing the notarisation of documents, acquiring entry permits, applications for residence visas, and transit and visitation visas for employees and investors. They also assist with the recruitment of employees at all levels.

6. How does a company set up in this freezone?

There are various types of businesses that operate in FCC freezone area that come under the categories of New Entity, Branch and Foreign Branch.

There are specific requirements and procedures that need to be complied with to set up a company in FCC, such as filing an application, providing a passport copy for each individual (including shareholders and staff at managerial levels), profiles of the parent company in case of branch formation, the details of each individual involved, payment of the necessary fees, and signatures on the articles of incorporation. Once the trade license has been issued, an establishment card/immigration card will be issued. An immigration file may also be referred to for the application of a visa.

7. What features do companies set up in this freezone have?

A company that operates in a freezone is free to carry out its business without the terms and conditions that usually apply to foreign companies. They are free from conditions such as having a local UAE partner and corporate and income tax laws.

8. What can companies set up in this freezone do?

Companies set up in this freezone can conduct broadcasting, audio and visual, communication and design, photography and videography, consultancy, advertising, architecture and technology, education and training, e-commerce and publishing, marketing and media service activities.

9. What can companies set up in this freezone not do?

Companies set up in FCC are not permitted to undertake activities beyond the scope of their license.

10. What types of business are allowed to operate in this freezone?

Companies set up in this freezone can conduct broadcasting, audio and visual, communication and design, photography and videography, consultancy, advertising, architecture and technology, education and training, and e-commerce activities. The creative zone agreement cannot be re-assigned and shares a personal status with customers. This agreement is read and governed by the laws of the UAE. No third party has the right to dictate its terms in the agreement.

11. What inheritance laws apply in this freezone?

Shareholder rights are heritable and can be transferred. However, the procedure is governed by UAE laws and FCC rules and regulations.

12. What taxation applies?

Businesses carrying out their operations from FCC are not subject to corporate and income tax.

13. What accounting and auditing rules apply to businesses operating in this freezone?

Annually there are no auditing requirements

14. Where do businesses operating in this freezone generally locate their bank accounts?

There isn't any specific location businesses operating in FCC should have their bank accounts. A company operating in FCC can have an account with any bank without restriction.

15. Are there any specific rules governing when moveable property in removed from the freezone area or transferred into the freezone area from another jurisdiction?

The Dubai Custom regulations are applicable when movable property is removed from, or transferred to, FCC freezone, and must be declared to Dubai Customs.

16. Are any specific licenses required to operate as a specific type of company in this freezone?

Certain types of company are only allowed to establish themselves in FCC. The FCC offers a variety of licenses which include: commercial licenses, single owner commercial licenses and freelancer.

17. Is there any specific ongoing regulation or monitoring of firms operating as particular types of company by this freezone authority?

The regulations and monitoring applicable to a company will depend on the nature of the company's business in FCC.

18. How are disputes settled with companies in this freezone?

The FCC Authorities accept all complaints from employees, will investigate them, and provide the suitable means to resolve the dispute.

19. How are disputes between onshore companies and companies in this freezone settled?

Disputes arising between a FCC freezone company and an onshore company will be settled through the normal judicial avenue (the Courts of Fujirah), unless an alternative forum is expressly provided for in the contractual agreement between the parties, and in these cases, the FCC will act as mediator.

20. What are the main rights and duties of an employer and employee working in this freezone?

The employer-employee relationship is governed by the rules and regulations of the FCC Free Zone. However, they are supplementary to Federal Law No. 8/1980, the UAE Labour Law, which deals with the rights and obligations of an employer and employee. FCC regulations and Federal Law No. 8/1980, the UAE Labour Law, obligate the employer to provide the employee with an employment contract which includes particulars such as the rights and duties of the parties, the term of work, leave, working hours, salary, etc. Therefore, the employer must ensure all the minimum requirements of the employee are met, and the employee should comply with the contractual obligations as agreed.

21. How are employment disputes between employers and employees working in this freezone settled?

The employment contract should detail the governing jurisdiction/authority for handling any disputes between employers and employees.

22. What entry qualifications and permits are required for staff working in this freezone?

Company shareholders, employees or officers who wish to be employed in a managerial post and take up UAE residency are required to submit their original decree translated into Arabic, attested from their home country and certified by the UAE

Foreign Ministry. To obtain a ‘visa on arrival' in GCC countries, the visa will need to state the managerial position the employee will be filling. Other employees who want a company visa, but do not have certified attestations, can only apply for a visa for administrative positions such as marketing and sales.

23. How are staff working within this freezone registered with the authorities?

To obtain a permit from the FCC Authority, employers have to submit an application for each applicant along with the

payment of the required fees. An entry permit has to be obtained by the employer on behalf of the employee. Once the employee has an entry permit, a medical fitness certificate will be issued after passing a medical examination. The last stage is the issuance of a residency permit, allowing the employee to work and live in the FCC region legally. The application also requires that the parties enter into a contract with FCC under Federal Law No. 8/1980, the UAE Labour Law.

24. What rules govern the remuneration and minimum benefits of staff working in this freezone?

The remuneration, benefits, working hours and other similar criteria are all governed by the FCC Free Zone rules and regulations. Remuneration and benefits for employees will be decided by the employer.

25. What rules govern the working time and leave of staff working in this freezone?

Federal Law No. 8/1980, the UAE Labour Law, regulates the working hours, leave terms, maternity leave, etc. of FCC Free Zone workers. Under the provisions of Federal Law No. 8/1980, the UAE Labour Law, companies are required to set rules for working hours, disciplinary procedures, grievances and the health and safety of workers.

26. What are the main features of a property lease in this freezone?

The main features of a property lease in FCC will include office space facilities, such as a P.O Box No, telephone line, fax, wifi, car parking, and other obligations applicable in case of any damage to the property.

27. Is it possible to apply for a building permit in this freezone? How is this done and what steps are required?

A building permit cannot be obtained in FCC Free Zone.

28. What environmental requirements must construction companies building in this freezone consider, e.g. form of building, landscaping or building height?

Construction companies are required to comply with the Fujirah Municipality requirements.

29. What are the key restrictions when leasing a property in this freezone?

Any legal entity operating in FCC should have an office based in FCC. The approval of the FCC Authority for a lease agreement is mandatory to maintain a license. An office can be rented from the FCC Authority or a private landlord. However, market rates are not applicable and are instead set by the FCC Authorities.

30. What are the rules governing the use of utilities in this freezone?

Utilities in FCC are charged based on the actual usage of the service. However, this is subject to the relevant utility provider such as the Fujirah Municipality.

31. How do retail premises establish themselves in this freezone?

No specific restrictions affect retail premises. However, their operation is subject to the approval of the relevant authorities.

32. Is it possible for hotels to operate in this freezone - how do they establish themselves?

No specific restrictions affect hotel operations. However, their activities are subject to the approval of the relevant authorities and FCC rules and regulations.

Originally published on LexisNexis


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