Stimulus Package for Dubai Free Zones
Jay Krishnan, Partner
Companies based in Dubai free zones need not worry about paying rent for the next 6 months. The Dubai Free Zones Council has come up with a major relief package, to help companies recover from the challenges caused by Covid-19.
Postponement of rent is not the core initiative included in the package; it includes various other schemes as well, mainly;
- Facilitating payments through easy installments
- Refunding insurance amounts, security deposits and guarantees
- Cancelling fines on companies and individuals
- Temporary contracts to enable free movement of labor between different firms in the free zones
Dubai Silicon Oasis Authority, the Dubai Airport Free Zone Authority, Jebel Ali Free Zone, the Dubai World Trade Centre, the Dubai International Financial Centre, the Dubai Development Authority, Dubai South, Meydan City Corporation and the Dubai Multi Commodities Centre are the entities that have contributed to the package, in coordination with the Dubai Free Zones Council.
The initiatives will ensure business continuity at a time when the world is witnessing a crisis like never before. It will provide support and relief to companies that are struggling, via a package of discounts and various other facilities.
Companies functioning in Jebel Ali Free Zone, National Industries Park and Dubai Cars and Automotive Zone need not pay fine on expired trade licenses and new firms will be exempted from paying license fees for the first year.
DIFC plans to implement the following initiatives;
Waiving annual license fees for new companies and 10 per cent discount on renewal fees for existing licenses, during the next three months
Postpone the payment plans for all commercial properties owned by DIFC Investments for six months
For property sales that happen within the three-month period, there will be a reduction in the ownership transfer fees. For this, the ownership transfers should be registered at the centre within 30 days following the end of the three-month period.
Companies that operate in Dubai Development Authority (DDA) and TECOM Group can postpone payments, and in the case of new firms, the lease period can be postponed and the registration fees can be cancelled for a period of six months. The fines on expired licences and other financial and administrative fees can be cancelled.
“We have also offered large exemptions on a wide range of fees for the 17,000 registered companies, by reducing registration fees by 50 per cent for new companies joining the centre, while current companies now have 30 per cent discounts on renewal and amendment fees. In addition, we have launched many flexible payment options for various sectors. We will continue supporting their needs and announce additional details in due course,” said Ahmed bin Sulayem, CEO and executive chairman of Dubai Multi Commodities Centre.
Jebel Ali Free Zone had earlier announced 50-70 per cent reduction in business-related fees for registration, licensing and administrative related charges.
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