How to Move Your UAE Business from One Free Zone to Another Guide 2026
UAE businesses sometimes need to change free zones — perhaps to access better office facilities, lower costs, or better banking relationships. Moving a UAE company from one free zone to another is possible but requires careful planning. This guide covers UAE free zone migration for 2026.
In this guide:
Why Move Free Zones?
- Cost reduction: moving from an expensive free zone (DMCC, AED 25,000+) to a cheaper one (IFZA, AED 14,900)
- Better banking: some free zones have stronger banking relationships (IFZA has better WIO/Mashreq relationships than some smaller free zones)
- Office upgrade or downgrade: moving to a free zone with better physical office options or conversely a virtual office to save costs
- Business activity change: if you need to add activities that your current free zone doesn’t allow, moving may be necessary
- Geographic: relocating business operations to a different emirate; e.g. moving from Dubai to Abu Dhabi
Option 1: Redomiciliation (Move the Existing Company)
- Some UAE free zones support redomiciliation: the company moves its registration from one free zone to another without creating a new entity; same company number, same bank accounts, same trading history
- Limited availability: not all free zone pairs support redomiciliation; check with both free zones whether redomiciliation is possible
- Process: mutual agreement between both free zones; shareholder resolution; document submission to both; typically takes 4-8 weeks
- Advantage: continuity of legal entity; bank accounts, contracts, and trade history preserved
Option 2: New Company in New Free Zone + Wind Down Old Company
- Most common approach: form a new UAE company in the target free zone; transfer business activities and assets to the new company; close the old company
- Process:
- Form new company in target free zone (1-2 weeks)
- Get new visa if needed (2-4 weeks)
- Open new bank account (1-2 weeks)
- Update contracts with clients and suppliers (name change to new entity)
- Transfer any UAE assets (IP, inventory) to new entity
- Cancel old visa and deregister old company (2-4 weeks)
- Disadvantages: gap in banking (old account closed; new account not yet established); clients must be informed of entity change; VAT and UAE CT implications of transferring assets between entities
UAE CT Implications of Free Zone Transfer
- Asset transfer between entities: if assets are transferred from old company to new company, UAE CT transfer pricing rules may apply; transfer at market value; any gain is potentially taxable
- Within CT group: if old and new companies are in the same UAE CT group (95% common ownership), asset transfers can be made at book value (no taxable gain)
- QFZP continuity: if old company was QFZP, the new company must independently meet QFZP conditions; QFZP status does not transfer automatically