HAMRIYAH COMPANY INCORPORATION
Hamriyah is situated in a strategic position in the west coast of Sharjah. The presence of a deep-water port, as well as an infrastructure adapted to import / export makes Hamriyah the ideal place for international trading undertakings. Hence, Hamriyah is a suitable choice for foreign entrepreneurs to set up a Free Zone Company (FZC) or Free Zone Establishment (FZE). In addition, Hamriyah is a preferred location for manufacturing organizations and service providers, due to its inexpensive annual license fees.
Advantages of Hamriyah Company Formation
- According to Hamriyah Free Zone laws, there is no need for appointing a UAE national shareholder to form a free zone company. This means full ownership of a Hamriyah company by foreign investors. Another advantage is that there is full repatriation of capital or profits allowed from the country for foreign investors.
- Tax exemption also enables a Hamriyah company to legally book international profit, while having the luxury of not having to pay corporate tax. A Hamriyah business also does not have to submit annual financial statements or pay tax returns.
- It is more economical to set up a Free Zone business entity in Hamriyah, in comparison to other free zones in the UAE. It takes only a day to form a Hamriyah company, provided that the documentation is proper. The business registration fee for a Hamriyah fee zone establishment (FZE) is DHS 9,000 (US$2,450). In addition ongoing business costs are modest. At the most, the annual license fees is US$3,250 in comparison to US$8,000 in the Jebel Ali Free Zone.
- Foreign investors can enjoy 50 years of legal tax exemption for their businesses. The explanation for this follows that land lease is for 25 years, and is renewable for another 25 years, making it a total of 50 years of tax exemption.
- Incorporation of a Hamriyah business entity is hassle free and costs significantly less. Well-structured warehouses, factories, as well as fully furnished and equipped office facilities with internet access are available for lease. This is less expensive than paying for fixed rental space, and is an option preferred by many foreign investors looking to set up new businesses in Hamriyah.
- Foreign investors can get one out of 3 different available businesses licenses in Ajman, including:
- Industrial license
- Services license
- Commercial license
A commercial or industrial license holding company will need a local agent to distribute their products in the UAE for purpose of sale. A service license holder will have to follow the stipulation of services stated within the license and carry out business activities exclusively within the free zone. Hamriyah free zone entities can apply for National Industrial License which enables them to be eligible as a local operator, or an AGCC business in the UAE districts. Obtaining this license will allow for exemption of custom duty, however, 51% share ownership has to be allotted to a AGCC citizen (or citizens).
- Small and medium size businesses in Hamriyah enjoy being the focus of attention, in terms of promotion and development of these establishments. Establishment of a Hamriyah SME Zone includes seven premeditated groups that encourage and foster the development of SMEs. Enterprises such as the E-office package offering bespoke assistance to businesses to help them successfully embark upon their business operations.
Disadvantages of Hamriyah Company Formation
- Business incorporation for a free zone establishment (FZE) or a free zone company (FZC) in Hamriyah will cost a minimal capital requirement, which is DHS 150,000 (or US$41,000). No minimum capital is necessary, however, for the formation of a branch for a foreign business entity.
- Incorporation of a free zone company or free zone establishment will require at least two directors and a single secretary. These individuals, according to the Hamriyah Free Zone Authority (HFZA), will have to show a legal residence or work permit. Also, one director and the secretary must have resident status too.
- Hamriyah does not have the international reputation of, for e.g. Dubai, as it is a small emirate. For this reason, international investors looking for a reputable and global corporate image for their companies choose not to form a Hamriyah company.
- The quality of housing for expatriate employees and schooling for their children is not up-to-par in Hamriyah. For this reason, most expatriates choose to have accommodations in Dubai or Sharjah, the downside being the lengthy commuting required in peak traffic hours, which can take up to an hour or more.
Other advantages provided by Hamriyah
Hamriyah is placed in a strategic location at the gateway of the Arabian Gulf and having access to the Indian Ocean. This enables it the advantage of catering to both the eastern and western markets. Another advantage is close proximity to an international airport which is connected to 230 cities and thus, acts as an entryway between three continents, in addition to the developing marketplaces in Asia and Africa.