An oasis in the desert
Rushika Bhatia
Industry Watch

An oasis in the desert

Dubai Silicon Oasis was established with the vision of becoming one of the world’s leading centres for advanced electronic innovation, design and development. David Whitford from Al Tamimi & Company provides an overview.

The Dubai Silicon Oasis free zone (DSO) was established by Law Number 16 of 2005. The impressive and distinctive Silicon Oasis headquarters building was completed in 2007, and since then the free zone became fully operational and has continued to prosper and expand.

The vision of H.H. Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, in 2005 of making DSO one of the world?s leading centres for advanced electronic innovation, design and development is in the process of being realised. In the comparatively short time the DSO Free Zone has been operating, this vision has widened to also include new related areas.
This expansion of the original vision has included the willingness of DSO to accommodate innovative client ideas and businesses if these can reasonably be tailored to fit the DSO activities requirements. There is therefore some scope to establish various business entities at DSO.
Establishing in DSO includes the usual attractive UAE Free Zone benefits of 100% foreign ownership, no corporate tax, no personal income tax and 100% repatriation of capital.
Permitted corporate business entities and structures
There are three separate business entities permitted in DSO.
A DSO Free Zone Establishment: This entity requires a single shareholder, either corporate or individual. The paid up capital requirement is AED 1,000,000.
A DSO Free Zone Company: This company requires a minimum of two shareholders and a maximum of ten shareholders. The shareholders may be either corporate or individuals. There is a minimum paid up capital requirement of AED 500,000 for company registration.
A DSO Free Zone Branch Office: This is a branch office of an already existing overseas or UAE company. Such an office does not require any separate paid up capital to that of the parent company. It is a requirement that any activities the branch office proposes to conduct in DSO do not extend beyond the activities carried out by the parent company, although specific inquiries need to be made at the time the branch office proposal is put forward to the DSO Authority.
Three different types of licenses are available. These are service licenses, industrial licenses and trade licenses.

Documentation requirements
The process for registration involves the completion of an application for initial approval. If the DSO Authority grants initial approval, the applicant is then invited to submit the required legal documentation.
This documentation is fairly standard, but needs to be carefully and accurately prepared otherwise it will be rejected. Document rejection involves additional time and cost.
For an overseas corporate shareholder of a DSO free zone company, for example, the basic required documentation (which should be notarised and attested) is:

Certificate of incorporation and memorandum, and articles of association of the proposed corporate shareholder

Board resolution or shareholder’s resolution to establish a DSO free zone company and guaranteeing financial commitment to the new DSO company operations.

Instruments of appointment of a legal representative or negotiator, manager, director(s) and secretary, together with any necessary and related powers of attorney.

In addition, an original letter from a bank operating in the UAE is required, certifying the deposit of the required paid up company capital has been made to an account held with the bank for the new company.
Latest DSO developments
In furthering its vision, DSO announced on 9th June 2008 that it had signed an exclusive agreement with the Rochester Institute of Technology (RIT), New York, USA to establish an overseas campus at the DSO free zone in the UAE. In accordance with the agreement the first new students arrived at DSO in August 2008.
The Rochester Institute of Technology has a worldwide reputation in the field of microelectronics. This and related fields are squarely within the scope of business of DSO and the initiative to bring RIT to DSO has been favourably received.
Students are offered the opportunity to obtain RIT Master’s degrees at DSO in the areas of electrical and mechanical engineering, networking and systems administration, finance, service leadership and innovation, and human resource development, as well as advanced certificates in project management; computer information assurance and, as an alternative to the Master?s degree, an advanced certificate in service leadership and innovation.
It is anticipated that further courses will be made available at later dates by RIT and as DSO also continues to pursue its vision of innovation in electronics, technology and related fields throughout the free zone and beyond.
David Whitford is a senior Associate in the Corporate Structuring Practice. Before joining Al Tamimi & Company, David worked as a Special Counsel with Gadens Lawyers and subsequently spent time studying in the United States before relocating to Dubai to join the firm. David has over 20 years legal practice experience and has advised Fortune 500 corporations, businesses, leading insurers and government authorities on a variety of legal issues. He is currently specialising in corporate structuring and re-structuring advice for corporations and entities moving to or currently transacting business in the Gulf Region and draws on a wealth of multi-jurisdictional knowledge and expertise.
Al Tamimi & Company Advocates and Legal Consultants, originally established in 1989, is today one of the leading law firms in the Arabian Gulf region. It is the largest local, non-affiliated law firm in the United Arab Emirates with offices in the Emirates of Dubai, Abu Dhabi and Sharjah, Riyadh (KSA) and associate offices in Doha, Baghdad and Riyadh. Visit for more information.