Want A Thriving Manufacturing Business? Focus On Dubai Textile City

October 13, 2023

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Manufacturing is the largest industry in the United Arab Emirates (UAE) second only to the oil and gas industry. To be more specific, and get the idea of what a significant role the textile industry plays in the country’s economy, one only needs to observe its impact on the GDP and GNP. The textile sector contributes an impressive 10%, which is steadily increasing with each passing year.

Dubai, the most famous and influential city of the UAE, recognized throughout the world for its luxurious shopping malls and Seven-star hotels. The fact that the most affluent people on the planet favor the Emirate as their prime shopping destination for buying luxury products is another feather in its cap. Among the most sought-after merchandise here are designer clothes and textiles. That makes the set up of the textile business in Dubai, a thriving business option for both budding entrepreneurs and seasoned business owners.

All you need to know about Dubai Textile City Free Zone :

Dubai Textile City Free Zone is a joint venture between TEXMAS, Dubai Port, and Customs Authorities. Whose sole purpose is to ease the textile manufacturers, suppliers, and dealers in the Emirate so that they can conduct their business activities without paying any extra added customs. DTC is located in Al Awir Free Zone, promoting the storage of fabrics and unfinished textiles for long periods without spending extra on customs duty, which is currently set at 5%. Dubai Textile City Free Zone also has the absolute support of Dubai Ports (sea and dry ports alike) and Customs. The Customs Authority will assist in handling the visa obligations and requirements proffered by the DTC regulatory authorities. Lastly, the rents and the conditions of the lease are excessively friendly and convenient so that investors who are interested in starting a textile business in Dubai will consider the free zone.

Business Setup in Dubai Textile City Free Zone :

Business setup in Dubai Textile City, like any other Company formation in Dubai Free Zones, is done through a procedure that investors should follow if they want to set up their company in any of the Dubai Free Zones. Although before you start the incorporation process, you need to decide on the type of business entity for your business setup in Dubai.

Types of Corporate Structures in DTC Free Zone :

  1. Free Zone Limited Liability Company – This is a separate legal entity that typically has only one proprietor or stakeholder. The sole proprietor can either be an individual or a corporate entity.
  2. Free Zone Company – This is a corporate entity with two or more than two shareholders. Same as FZ-LLC, the owners can be either individuals or organizational structures.
  3. Branch or subsidiary of a UAE based Company or Foreign Company – A branch office setup in Dubai is an entity that is working under the name of its company of origin or parent company. It is usually representative of an existing business.
    After picking the type of business entity most suitable for your business setup, the next step is to choose the type of business activity.

Types of Business Activities Licensed in DTC Free Zone :

Exactly like every other Free Zone in Dubai, Dubai Textile City also has its list of business activities that they permit within their bounds. They are as follows –

  • Import-Export
  • Trading
  • Anything Related to Textile ( from production to its procurement)
  • Fashion

After determining which business activity your company is most comfortable in and will be most successful in, the next move is to register your company.

The steps for registration are :

  1. Get consent from the relevant free zone authority
  2. Choose a trading name for your company
  3. Apply for registration with all the required specifications
  4. Tender the documents needed at the free zone office
  5. Pay all the fees

After your petition is approved, the DTC Free Zone authorities will grant you with the Certificate of Incorporation and a Trade Business License.

Documents Demanded for Company Incorporation By Dubai Trade City :

  • Passport copies of the company owner and any shareholders
  • Original Passport and resume of the manager of the company
  • Composed Memorandum of Association and Articles of Association notarized by the UAE Embassy
  • The physical address of the office where the company will work from and the home address of the owner
  • Confirmation of trade name reservation
  • Confirmation of initial endorsement for the business incorporation
  • Evidence of invested capital
  • Copy of the Board decision of the parent company in case the company is seeking permission to open a branch office

Now that you understand how to start a business in Dubai Textile City Let us discuss a few perks of setting a business in this free economic zone.

  • Hundred percent foreign ownership
  • Hundred percent corporate tax exclusion
  • Hundred percent exception on paying any personal income tax
  • No payment of any added customs duties
  • Long lease period at an attractive and affordable rent prices
  • You can sublease the rented premises to other tenants
  • Meager operational costs

The most crucial thing to know here is getting the relevant license for your business to operate under legal bounds. To set up a textile business in the UAE, you require a General Trading License. It can only be obtained when the textile company is registered. It should be acknowledged that Dubai and the other cities where textile manufacturing businesses are set up must obey the International System of Units, which restricts the capacities of textile materials to be produced solely in the metric system. The vendor must also guarantee that the sold products meet the national standard safety and quality laws.

We at KWS Middle East can assist you in setting up a textile business in Dubai. Our Business setup consultants are well-versed with the business incorporation process and legal issues that are involved in it. We can make this whole ordeal hassle-free.

Contact us and book your commitment-free call with our exceptional team today!

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