More and more jurisdictions offer solutions for professionals in the field of cryptocurrency and NFT. Among the best such solutions now is the registration of a crypto company in the United Arab Emirates, in the IFZA-DSOA zone.
Lawrange law firm provides comfortable legal support for entrepreneurs who want to start a cryptocurrency business in the UAE. Our services cover: 1) company registration; 2) preparation of internal policies and regulations for AML; 3) opening a corporate account in a crypto-friendly bank; 4) obtaining a license for cryptocurrency activities. The cost of a license for one type of activity is 14,500 USD.
Important! You can register companies in the UAE in the IFZA-DSOA zone remotely.
The successful execution of a turnkey crypto business is facilitated by many years of experience of Lawrange experts in legal support of blockchain projects, including obtaining the appropriate licenses. We know how to build trusting business relationships with local regulators, as well as take into account the peculiarities of the legislation and the tax environment.
What is the IFZA Free Trade Zone?
The International Free Zone Authority (IFZA) zone added to the list of free zones of the Emirates relatively recently, in 2018. It is located in the heart of the emirate of Fujairah in the east of the UAE along the Gulf of Oman. It is the most distant emirate from Dubai. In this SES, you can register an individual business, a branch, a subsidiary, and an FZCO (Free Zone Company). Initially, trade, service and industrial licenses were granted to firms. With an agreement with the Dubai Silicon Oasis Authority, opportunities for entrepreneurs have expanded.
***Note: Any free economic zone (FEZ, free zone) in the UAE is a clearly defined part of the city where a special legal regime for entrepreneurship operates, in particular, 100% foreign ownership of firms is allowed without involving a local partner (persons with UAE citizenship) .
Note! According to analysts, today IFZA is a promising, competitive and fast growing free zone in the Emirates. Investors in this free zone are offered transparent procedures for starting a business and favorable taxation conditions. Despite a short period of operation, IFZA has managed to win the respect of the business community.
The Fujairah International Free Zone offers entrepreneurs a wide range of office solutions. At the same time, offices are located not only in the emirate of Fujairah, but also in Dubai. This is the only free zone that has an equipped business center for its clients in Dubai. It is located in Dubai Motor City. This business center provides the feeling that the company has real connections with Dubai, and not with Fujairah.
What is a DSOA Free Economic Zone?
The Dubai Silicon Oasis Authority (DSOA) has a longer history than the IFZA. The Silicon Valley of the Emirates was formed in 2005. In the business environment, this free zone positions itself as a high-tech park. This is a favorable environment for high-tech companies and venture investors, similar to Silicon (Silicon) Valley in the United States.
Note! The area of the DSOA free zone is 7.2 million square meters. Entrepreneurs in this SEZ are offered modern infrastructure and a three-level data center. As part of the functioning of the DSOA, projects are being developed to support young talents. In particular, a business incubator was created in this SEZ, within which registration of a company is available on simplified terms. The cost of registering a business in this case is much lower than when using the standard procedure. FEZs also offer benefits when registering a business in exchange for a share in this opening business.
Ecosystem IFZA-DSOA
On October 21, 2020, an agreement was signed between Dubai Silicon Oasis Authority (DSOA) and International Free Zone Authority (IFZA). Freezone regulators have decided to allow existing and new companies in the IFZA to operate through the DSO. Similarly, the horizons for business expanded. Opportunities have emerged for collaborations with hundreds of high-tech companies based at DSOA Headquarters, Dubai Digital Park (DDP) and Dubai Business Technology Campus (Dtec).
The agreement opened the way for companies, start-ups and industry experts registered with the IFZA to work with the DSO and benefit from the state-of-the-art infrastructure, state-of-the-art equipment and the many benefits that come with local, regional and global business sectors.
Important! Now, by registering a company with IFZA, you can become part of a rapidly developing ecosystem in Dubai – one of the most progressive cities on the planet. IFZA takes advantage of its strategic location and combines it with high standards of customer-centric service to streamline both the registration process and business operations.
Cryptocurrency business status in the UAE and IFZA-DSOA
In a number of countries, so-called virtual assets continue to be treated with distrust and even hostility. But on the other hand, many are convinced that cryptocurrency is an anonymous digital asset that cannot be faked. Interest in various cryptocurrencies is now gaining momentum around the world. Many millions of people with bated breath follow the rapid ups and downs of bitcoin. When getting acquainted with cryptocurrency, the user is amazed at the speed with which secure anonymous transactions can be made. Instability and volatility in cryptocurrency trading are replaced by long-term and reliability.
Note! As a global financial hub, it’s no surprise that lawmakers in Dubai, a global financial hub, are keeping a close eye on the rise of cryptocurrencies and NFTs, and now the forward-thinking city-state has announced ambitious plans to become a leading crypto hub by 2025. If you want to learn more about the state regulation of non-fungible tokens (NFT), read the description of our service “Opening a company for an NFT project”.
When the overwhelming majority agree that virtual assets are here to stay, it’s good to know that Dubai and the UAE are creating a regulatory framework to protect all participants in the cryptocurrency market, and ensure transparency in a sector that until recently was considered unregulated and hidden from prying eyes.
In May 2021, a crypto center appeared in the free economic zone of Dubai. Combined with the opportunity to obtain a crypto license in Dubai, this is an excellent platform for innovators, entrepreneurs and pioneers in the cryptocurrency business. Entrepreneurs in the crypto center are provided with spaces for joint work (co-working), various events for learning and exchange of experience, and support for young blockchain startups.
If you are looking for the best place to start your crypto business, you should start and end your search with IFZA-DSOA. Much more than a free economic zone is offered here. We are talking about a whole community where companies are motivated to develop, inspired to succeed and can become part of a dynamic ecosystem.
Among the key features of IFZA-DSOA:
- advantageous strategic location in one of the dynamically developing areas of the UAE;
- availability of world-class platforms and infrastructure for high-tech projects;
- favorable environment for business in terms of taxation;
- 100% of the company is owned by a non-resident;
- no personal income tax. persons:
- 0% income or corporate tax;
- full exemption from import and export taxes;
- 100% repatriation of capital and profits.
General Rules for Business Licensing in the UAE
The legal framework for licensees is favorable, both when obtaining a license for the first time, and in the case of renewal (renewal). With permission from the authorities, IFZA licenses can provide visas. In particular, visas for three years can be issued to shareholders and employees.
Important! To determine the requirements that apply to you as a licensee, our account managers will advise you by phone, email or messenger. Once such requirements are established, we will provide you with a proposal detailing:
- license type;
- types of commercial activities under this license;
- a package of documents for obtaining a visa;
- office solutions.
The validity of any license in the Emirates is one year. The license must be renewed in a timely manner, without delay. If the license is not renewed for more than 4 months from the date of expiration, then it will be automatically canceled. In such circumstances, in order to renew the license, you will have to pay a fine and go through the procedure for obtaining this permit again.
Very important! Companies in the UAE must only engage in business activities that are provided for by their license. In case of violation of this condition, a fine is imposed on the legal entity.
Licenses for cryptocurrency activities in the UAE
All interested entrepreneurs and investors can now connect to the formation of the crypto-currency sector in Dubai. The current legislation provides for regulated and unregulated types of cryptocurrency activities.
To obtain a license for unregulated areas of crypto business, it is enough to submit mandatory documents to the registrar, and for regulated ones, you will have to fulfill the requirements of regulators. In particular, obtaining a regulated license provides for the confirmation of qualifications, the provision of a business plan, financial and technological guarantees, implementation of the KYC and AML program.
Types of unregulated licenses for cryptocurrency activities in the UAE, in IFZA-DSOA:
-
Distributed Ledger Technology (DLT) services.
7229-99 Distributed Ledger Technology Services
The licensee’s activities cover the provision of IT solutions for database management and the provision of ancillary services based on distributed ledger technology, including blockchain. In particular, we are talking about the promotion of goods and services using DLT technologies, crypto assets and crypto tools. Firms with this license are not allowed to trade or engage in the exchange of crypto-currency for fiat currency or goods, as well as provide any financial or brokerage services, or engage in payment processing.
-
Proprietary cryptocurrency trading.
6599-92 Proprietary Trading in Crypto-commodities
The activity of the licensee involves the acquisition of cryptocurrencies (goods developed on the basis of distributed ledger technology) for its own funds, as well as their sale. Such activities do not include exchange transactions, brokerage, financial and banking services, as well as the processing and storage of payments.
Note! Both licenses require that your company has the appropriate AML/CFT regulations. The enterprise must have a formal accounting system and annually submit audit reports. But these conditions are much less stringent than when obtaining regulated licenses.
Documents for obtaining an unregulated crypto license in the Emirates
In the package for submission to the registrar, the following is prepared:
- scanned copy of the passport;
- digital photo according to the same standards as for a passport;
- application for a license (filled in by us).
Also, you should send three options for the name of the future crypto company to the representatives of Lawrange Law Firm.
Important! All documents are sent online – you do not have to go anywhere or use the mail.
The project implementation timeline is roughly as follows:
- company registration – two weeks (from the moment of receipt of documents);
- obtaining a license – 6-8 weeks.
Company registration in IFZA-DSOA
You can learn more about the peculiarities of registering and doing business in the Emirates from the description of our service “Registration of a company in the UAE in 2022”.
Briefly, the procedure for registering a business in a free economic zone is as follows:
- Choosing the type of activity and registering the name of the company.
- Completion and submission of the application form to the administration of the free zone + payment of fees (for the Establishment Card and E-Channel subscription). Applications for opening firms in the UAE are rarely rejected. If the refusal is related to the identity of the founder, shareholder, director, including refusals for security reasons, the fees paid are reimbursed.
- Sending additional documentation, information and clarifications, if requested.
- Signing the company registration conditions, where the applicants are guaranteed that they are not involved in illegal activities, money laundering and immoral actions.
- Obtaining a license and applying for a resident visa.
Opening a bank account in Dubai
While Dubai claims to be one of the most advanced crypto hubs in the world, the local banking sector is lagging behind when it comes to dealing with crypto assets. It is still extremely difficult to open a corporate bank account in the Emirates for cryptocurrency activities. And you can’t do without it, because in order to create a company, you need to open an account and deposit authorized capital on it.
However, Lawrange experts have found a solution to this problem. One Swiss bank agrees to issue accounts for companies registered with the IFZA-DSOA. At the same time, the bank requires the director of the company to have a resident visa of the Emirates.
With a high probability, the issue of opening accounts in the Emirates for crypto companies will be resolved soon. The Lawrange team is closely monitoring the situation and is ready to inform you of significant changes at any time.
But neither to open a company, nor to open a bank account for it, you do not need to go to Dubai! Everything can be done remotely! Your presence in Dubai is only required to obtain a resident visa. That is, you can come to Dubai once after registering the company.
Note! As a proprietary cryptocurrency trader, you can apply for three visas for employees and visas for all family members.
What benefits can be obtained from cryptocurrency activities in the UAE?
Within the framework of the law, crypto-currency activities in the UAE open up broad prospects for profit in various areas. What exactly can be done?
- Buy assets with cryptocurrency. In addition to generating income, converting cryptocurrencies into highly liquid assets provides proof of the origin of funds, if necessary.
- Sell goods and services for cryptocurrency. Calculation in cryptocurrency expands the target audience of consumers – it helps to increase sales. The country’s legislation allows you to completely digitalize the process of selling services.
- Invest and attract investments. The legislation defines a wide range of investors and provides many opportunities for attracting funding.
- Earn on the infrastructure of the crypto market. You can professionally engage in cryptocurrency operations using your experience and entrepreneurial intuition.
Conclusion
The United Arab Emirates is one of the most powerful financial centers of our planet. Since its inception to the present, cryptocurrencies and crypto-currency activities have never been banned in the country. But gradually, at the legislative level and the level of regulatory bodies, the legal field and the rules of the game in the cryptocurrency market are being formed.
A licensing procedure is being introduced for professional cryptocurrency activities. Free economic zones are becoming pioneers in the field of crypto business regulation. Crypto firms in such zones are offered regulated and unregulated licenses.
Experts from the Lawrange law firm have carefully studied the nuances of the regulations and rules for regulating crypto activities in the Emirates, and have chosen the best option in our opinion. We offer to register a business in the IFZA-DSOA zone with the most favorable legal and tax regime. With our support, you will be able to obtain the right license for you. Additionally, as part of the consultation, we are ready to explain the specifics of working with an unregulated license and other points related to the registration of a crypto business in the UAE.
FAQ
Do I need a local partner to register a company in the IFZA-DSOA free zone?
No, in the free economic zones of the UAE, a non-resident can 100% own a legal entity.
Is it possible to register a company in the UAE remotely?
Yes. With the support of Lawrange representatives, the opening of a business is carried out completely remotely. It will be necessary to come to the Emirates only for registration of tax residency – obtaining a resident visa.
Is it possible to obtain resident visas for family members through the opening of a crypto company?
Yes. Such a possibility exists. Residential visas can be issued for several employees of the company and for family members.
