DIFC And JAFZA Join Forces – The Dual-Zone Advantage

Dubai is reinforcing its position as a global hub where trade and finance operate side by side. On Tuesday, 28 October, DP World's Jebel Ali Free Zone Authority (JAFZA) and the Dubai International Financial Centre (DIFC) announced a partnership to create a framework that enables companies to operate seamlessly across both zones. The agreement connects JAFZA's trade and industrial ecosystem with DIFC's advanced legal, financial, and structuring platform. Under this dual-zone model, businesses can structure capital, access financial services, and plan for long-term legacy through DIFC, while manufacturing, storing, and distributing goods through JAFZA, achieving end-to-end efficiency across the investment and supply chain.

Dual operation across the two zones provides companies with clear cost and operational advantages:

1. Businesses can manufacture or import duty-free in JAFZA and use a DIFC entity to raise capital or book regional revenues tax-efficiently, taking advantage of 0% corporate tax on qualifying overseas income.
2. This structure minimises customs duty leakages and corporate tax, provided free-zone income qualifies under UAE corporate tax laws and goods remain within free zones or export channels.
3. Speed, function and convenience are also central: a deal can be structured via a DIFC SPV or financing arrangement and shipped from JAFZA warehouses ensuring that financial strategy and physical execution move concurrently

Importantly, the partnership strengthens governance and risk mitigation, combining DIFC's common-law framework- including independent courts, arbitration centres, and DFSA's regulatory oversight- with JAFZA's operational infrastructure. DIFC entities can resolve disputes or use DIFC law as governing law in contracts for better enforceability, while having physical operations in JAFZA insulates inventory against global logistics disruptions. This dual-zone approach allows each zone to offset the other's weaknesses and align financial and operational risk management.

In addition, by operating in both zones, businesses gain access to trade finance in DIFC that directly supports JAFZA-based trade flows, while finance companies can leverage JAFZA subsidiaries and port infrastructure to expand into new product lines. Presence in both hubs signals strength to investors and partners, demonstrating a commitment to governance, scale and strategic foresight.

This Partnership provides key structuring advantages for global operations by coupling DIFC's range of legal vehicles including holding companies, SPVs, trusts and foundations, with operational businesses in JAFZA to manage governance, succession planning and cross-border investments, while efficiently channelling regional profits into global opportunities.

The advantages of dual-zone operations are best seen in practice:

A global automotive group uses a DIFC regional holding company and treasury SPVs to centralise cash, IP licensing and inter-company flows, while JAFZA provides vehicle storage, PDI and spare-parts distribution, achieving shorter lead times, better working-capital control and clean governance.

A commodity trader and supply-chain operator employs a DIFC SPV with a risk-management framework and access to professional services and dispute resolution via DIFC Courts, while JAFZA handles bulk storage, terminal operations and bonded logistics, ensuring smooth trade execution.

A family-owned conglomerate combines a DIFC foundation and HoldCo for governance, succession and asset protection with JAFZA operating companies across multiple sectors for manufacturing and distribution, achieving institutionalised governance with scalable on-the-ground operations.

At HAS Law we help clients navigate the dual-zone landscape by designing DIFC structures to own and finance JAFZA operations, ensuring full licensing and regulatory compliance. Our team's deep experience and knowledge in drafting contracts combine with governance frameworks, leveraging DIFC laws for enforceability and execution ofcross-zone transactions as well as mitigating operational, financial and regulatory risks. By combining strategic advice, regulatory guidance and practical execution support, we help clients unlock the full potential of operating across DIFC and JAFZA, creating a seamless bridge between capital, governance and real economy operations.

The JAFZA–DIFC partnership represents a strategic collaboration that empowers companies to operate faster, smarter and more efficiently. By connecting Dubai's leading trade and industrial hub with its premier financial centre, this dual-zone model opens new avenues for market access, trade finance and investment structuring, ensuring that finance meets trade, governance meets logistics and strategy meets execution, all within a single city.

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