Green Oasis – the Masdar City Free Zone, Abu Dhabi

Masdar City, which aims to become the first zero-carbon footprint city in the world, kicked off UAE Innovation Month in February with an exciting programme of clean technology exhibits and engaging community activities. Masdar took the opportunity to highlight its role in advancing innovation, through youth activities that aim to promote creativity and raise awareness about the UAE’s National Innovation Strategy, which was launched by Sheikh Mohammed bin Rashid in 2014.

Masdar City is the flagship project of Abu Dhabi Future Energy Company (Masdar) and operates as a special economic zone with a focus on clean technology and renewable energy. It was developed with the vision of transforming Abu Dhabi into “the pre-eminent source of renewable energy, knowledge, development, implementation and the world’s benchmark for sustainable development.”

Masdar City relies on solar energy and other renewable energy sources but its unique construction allows for the temperature in the streets to be between 15 and 20°C, much cooler than the desert climate. It is powered by a 10-megawatt solar farm, while movement sensors have reduced electricity and water consumption by more than half. The project has gained the support of global organisations such as World Wide Fund for Nature, BioRegional and Greenpeace.

The Masdar City Free Zone and Science & Technology Park is an emerging global clean-technology cluster that places its resident companies at the heart of the global renewable energy and clean-tech industry. It covers an area of approximately 6km2 and is located in close proximity to Abu Dhabi International Airport and only 17km from central Abu Dhabi.

As a test-bed for renewable energy, companies established in Masdar City can pilot, demonstrate, refine, develop and commercialise their technologies. It provides a multitude of incentives, such as 100% foreign ownership of companies eliminating the need for a local partner, a low-cost operational environment, full repatriation of capital and profits and exemption from import, export, corporate and personal taxes.

These business-friendly features are complemented by Masdar City’s state-of-the-art technology infrastructure, world-class facilities and liberal investment regulations creating a favourable environment for companies to freely conduct business.

The city’s desire to go green has attracted 537 entities – mostly clean-tech businesses – to move in, including the International Renewable Energy Agency (IRENA), an intergovernmental organisation that chose to have its headquarters in Masdar City over Hamburg, Germany.#

Key features of the Masdar City Free Zone include:

  • Research and Development hub with potential to partner with the Masdar Institute of Science & Technology
  • Critical mass of sector knowledge and talent
  • 100% foreign ownership, no local partner required
  • 100% exemption from corporate and personal income taxes
  • Unrestricted repatriation of both capital and profits
  • 0% import tariffs
  • No minimum capital requirement if setting up a branch
  • Enhanced framework of intellectual property protection
  • Simple set-up with a ‘one-stop-shop’ for registration, government relations and visa processing
  • Cost-effective licensing and office space

Companies operating in Masdar City must do so in accordance with the Masdar City Companies Registration Regulations. Masdar City facilitates quick and straightforward incorporation services to businesses, allowing them one of the following three types of legal structure:

  • Free Zone Limited Liability Company (FZ-LLC) with corporate and/or individual shareholders
  • Branch of a foreign / offshore company
  • Branch of a UAE-based company (including companies incorporated in other UAE Free Zones).

There is no minimum capital requirement for setting up a branch of your company. For establishing an FZ-LLC, the minimum capital requirement is AED 50,000 (US$13,624).

Companies incorporated and registered in Masdar City have a legal identity and are permitted to open branches outside the Free Zone, subject to the approval of the authorities concerned. The Masdar City Free Zone licence is valid for operating a business only inside the free zone. Goods may only be sold in the local market or in other Emirates through distributors or agents.

Masdar City also provides companies with a number of licensing tariff options, which depend upon the number of a company’s activities and its financial plan:

  • Start-up package permits two activities – AED 10,000 licence fee
  • Mid-range package permits five activities – AED 15,000 licence fee
  • Wide-range package permits 10 activities – AED 20,000 licence fee

All tariff fees are on an annual basis and the licence tariff is capped at a maximum of 15 activities per licence for AED 30,000 licence fee.

The business segments for which licence applications are accepted in Masdar City include:

  • Renewable Energy
  • Clean Tech & ICT
  • Marketing and Events
  • Human Resources Development
  • Energy Industry
  • Healthcare Services
  • Service Providers
  • Property Development Services
  • Regional Head Quarters, Trading and Holding Companies
  • Business Centre and Data Centres
  • Community Services (Retail, Food and Beverage outlets)
  • Oil and Gas Services

Commercial licences issued by Masdar Free Zone Authority are subject to leasing a facility within the Masdar City to suit their operational requirements on either a ‘ready-to-go’, ‘shell and core’ or ‘Design-Construct-Lease’ basis.

  • Ready-to-go Business Centre office space options:
    • FlexiDesk – AED 13,500
    • Workstation – AED 20,000
    • Executive Office from 30m2 @ AED 2,400/m2
  • Shell and core – Commercial Office / Retail space from 100m2 @ AED 1800/m2
  • Design-Construct-Lease (DCL) – sign a long-term lease with Masdar to design, develop and deliver a building that meets your firm’s specific requirements,

If you require any further information about the opportunities available in Masdar City, please contact our new Sovereign Abu Dhabi office, which is located in the Abu Dhabi Global Market (ADGM) Free Zone.

Sovereign Corporate Services Abu Dhabi
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