Dubai South vs Dubai CommerCity vs Dubai Internet City: Which Free Zone Fits Your Business

Dubai South, Dubai CommerCity, and Dubai Internet City are three sector-specific Dubai free zones that are routinely confused with each other, and the single fact that separates them is customs status. Dubai Aviation City, the free zone underlying Dubai South, appears as entry six on the Dubai list in the annex to Cabinet Decision No. 59 of 2017 on Designated Zones. Dubai Internet City does not appear on that list at all. That distinction decides whether goods can sit in your facility outside the scope of UAE VAT, and whether distribution income can reach the 0% corporate tax rate. Whether distribution income actually reaches 0% depends on who you supply, which our free zone e-commerce and fulfilment route sets out against the Ministerial Decision.

This guide compares the three zones on what actually differs: who each one is built for, the entity and license types available, the facility options and how they set your visa quota, the government fees that are published rather than quoted, and a decision rule for choosing between them. It also flags where a figure is a package price rather than an official tariff, because free zone marketing numbers move and official tariffs do not.

Dubai South vs Dubai CommerCity vs Dubai Internet City: The Full Comparison

The three sit at different points on one axis: how physical your business is. Dubai South handles cargo, aircraft, and industrial plant. Dubai CommerCity handles parcels and online orders. Dubai Internet City handles code and contracts.

Dubai South is an aerotropolis free zone around Al Maktoum International Airport, regulated by Dubai Aviation City Corporation, and suited to logistics, aviation, and light industry. Dubai CommerCity in Umm Ramool is a dedicated digital commerce free zone combining offices, warehousing, and fulfillment. Dubai Internet City is TECOM’s tech cluster regulated by the Dubai Development Authority, built for software, IT, and regional technology headquarters.

If you are still at the stage of choosing between mainland and free zone at all, start with our Dubai business setup guide, then narrow the shortlist using our comparison of the best UAE free zone for your business.

Dubai South: The Free Zone Built Around an Airport

Dubai South is not a business park with an airport nearby. It is a masterplanned city built around Al Maktoum International Airport, with the free zone inside it, and that scale is why it attracts logistics and aviation businesses rather than consultancies.

Dubai South’s free zone is regulated by Dubai Aviation City Corporation, which acts as registrar, licensing authority, and immigration one-stop shop. Companies register as a DWC-LLC or as a branch of an existing entity. The zone is organized into districts covering logistics, aviation, business, retail, and residential use, with the Mohammed Bin Rashid Aerospace Hub serving the aviation sector.

The scale is documented rather than promotional. The Dubai Government Media Office confirms the new passenger terminal at Al Maktoum International Airport carries a cost of AED 128 billion and a design capacity of 260 million passengers and 12 million tonnes of cargo per annum, with five parallel runways and over 400 aircraft contact stands. For a freight or aviation business, that is the operating context you are buying into.

Inside the Logistics District sits EZDubai, described by the zone as a 920,000 square meter dedicated e-commerce zone offering the first dual-licensed and hybrid-bonded facilities, licensed through its own one-stop authority. This is where Dubai South overlaps with Dubai CommerCity and why the two get confused. The difference: EZDubai is a district inside a much larger aviation and industrial city, while CommerCity is a standalone campus.

Dubai CommerCity: The Dedicated Digital Commerce Free Zone

Dubai CommerCity was built for one business model, not a general trading zone with an e-commerce package bolted on. Offices, warehousing, and consumer-facing space sit on one site, so an online seller can license, store, pick, and ship without leasing in two jurisdictions.

Dubai CommerCity is a joint venture between the Dubai Integrated Economic Zones Authority and Wasl, located at Umm Ramool. It offers FZCO, PLC, and branch structures, with a minimum share capital of AED 1,000 for an FZCO and no share capital for a branch. Licenses cover e-commerce, trade, service, general trading, and freelance activity, and a single license can carry up to 20 activities.

The campus is organized into three clusters, per Dubai CommerCity. The Business Cluster holds Grade A offices with smart desks, coworking, fitted offices, and shell-and-core units. The Logistics Cluster holds dedicated and third-party warehousing, fulfillment centers, and last-mile facilities. The Social Cluster holds retail and dining. Location is the practical selling point: the zone puts itself roughly five minutes from Dubai International Airport and 45 minutes from Jebel Ali Port, which suits air-freighted parcels far better than sea containers.

One feature deserves attention because it solves a genuine problem. Dubai CommerCity offers a dual license with the Department of Economy and Tourism, described as enabling companies registered in Dubai CommerCity to apply for a DET license without needing physical office space. For an online seller who wants to invoice mainland UAE customers directly rather than through a distributor, that removes the usual free zone ceiling. If your model is purely online, compare this against the requirements in our guide to the e-commerce license in Dubai.

Dubai Internet City: The Tech Cluster With a Square-Foot Visa Rule

Dubai Internet City is the oldest of the three and the most straightforward to understand. It is an office cluster for technology companies, and its economics are driven by desk space rather than cargo space.

Established in 1999 and operated by TECOM Group, Dubai Internet City sits within the jurisdiction of the Dubai Development Authority. Companies incorporate as an FZ-LLC or register a branch of an existing foreign or UAE company, with a minimum paid-up capital of AED 10,000 for an FZ-LLC. Licenses and permits run for one year and renew annually, and the minimum lease term is one year.

The visa rule is the most concrete difference between Dubai Internet City and the other two. Per the Dubai Internet City FAQs, a company can sponsor one employee per 60 square feet of leased space, and in commercial space one visa is allocated for every 60 square feet. That is a clean, testable formula: a 600 square foot office supports roughly ten visas. It also means headcount planning is a leasing decision from day one, not something you resolve later.

Setup runs as three steps, submit the application, submit documents and pay, then sign and collect, and typically takes around seven working days. TECOM reports that Dubai Internet City contributes towards 65% of Dubai’s tech GDP and hosts 20 research, development, and innovation centers. Smaller teams often start in D/Quarters coworking or on a GoFreelance permit, and our comparison of a virtual office versus a flexi desk in Dubai explains what each buys you in visa terms.

Published Government Fees at Dubai South

Free zone costs are usually quoted as bundled packages, which makes comparison difficult. Dubai South is the exception here because Dubai Aviation City Corporation publishes an itemized tariff. The figures below are government charges from that schedule, separate from facility rent.

Two details in that schedule matter. The license fee is flat rather than scaled to activity count, with AED 1,000 per additional class of activity. And the AED 1,000 additional visa quota line confirms that quota at Dubai South is not permanently capped by the facility, unlike zones where a small unit hard-limits headcount. Exit costs are rarely budgeted at setup, and our guide to free zone license cancellation and liquidation covers the full wind-down.

Dubai CommerCity and Dubai Internet City do not publish comparable itemized tariffs. Both quote packages on enquiry, and Dubai Internet City states only that its pricing is aligned with prevailing market rates. Any AED package figure you see for those two on a third-party site is indicative and should be confirmed on the zone’s own portal as of July 2026.

The Designated Zone Split Is the Biggest Tax Difference

This is the point most comparisons miss. All three zones offer 100% foreign ownership and all three can host a Qualifying Free Zone Person. But only some of them can host the distribution activity that reaches 0% corporate tax, and that depends on Designated Zone status rather than on free zone status.

Under UAE VAT law a Designated Zone must be a specific fenced geographic area with security measures and customs controls, and its operator must comply with Federal Tax Authority procedures. Dubai Aviation City appears on the Dubai list in the annex to Cabinet Decision No. 59 of 2017. Dubai Internet City does not, which is consistent with it being an open office campus rather than a customs-controlled area.

The corporate tax consequence is specific. The Federal Tax Authority’s corporate tax framework for Free Zone Persons states that the 0% rate applies to qualifying income from activities performed within the prescribed geographical areas of a free zone, and that for distribution activities this needs to be a Designated Zone. Substance must follow: core income-generating activities, adequate assets, full-time employees, and operating expenditure all have to sit in that Designated Zone. Warehousing in one place and running the operation from another does not satisfy the test.

The de minimis rule is the other number worth memorizing. Non-qualifying revenue must not exceed the lower of AED 5 million or 5% of total revenue. Cross that line and the whole entity loses Qualifying Free Zone Person status, with income taxed at 9% rather than just the offending slice. The FTA also states that taxpayers should check with their own free zone authority to confirm whether they operate in a free zone or a Designated Zone, which is exactly the question to put in writing before signing a lease. Our guide to free zone qualifying income and the 0% corporate tax rate works through every condition.

How to Choose Between the Three

The decision rule is short once you strip out the marketing. Ask what physically moves through your business, then ask who your customer is.

Choose Dubai South if goods, aircraft, or industrial equipment pass through your operation, if you need bonded or hybrid-bonded storage, or if you want land and a facility you can scale into. Choose Dubai CommerCity if you sell online and want licensing, warehousing, and fulfillment on one campus close to the passenger airport. Choose Dubai Internet City if your product is software or services and your main cost is people rather than pallets.

Two edge cases complicate this. If you sell online but ship containers by sea rather than parcels by air, Dubai South’s Logistics District or a port-adjacent zone beats Umm Ramool, and our JAFZA setup guide covers the quayside alternative. If most of your revenue will come from mainland UAE customers, either the CommerCity dual license route or a mainland license fits better, and our guide on converting a free zone company to mainland Dubai shows what fixing that later costs.

Cost-led founders often land on none of these three, because all three are sector zones with real facility commitments and a cheaper general-purpose zone suits a small consultancy with no reason to be near an airport. Our Meydan Free Zone setup guide covers that end of the market. Whichever zone you pick, budget time for banking, because the account is usually slower than the license: see our guide to opening a UAE business bank account.

Where Each Zone Is Genuinely Weak

Every free zone page lists advantages. The trade-offs are harder to find and matter more at the point of decision.

Dubai South’s weakness is distance and stage of development: it is a long commute from central Dubai, and a team that needs to be near Downtown or Marina will feel that now rather than in 2030. Dubai CommerCity’s weakness is narrowness, since a business with no online retail dimension gets little from the ecosystem while still paying for the campus. Dubai Internet City’s weakness is the absence of customs infrastructure plus the visa formula itself, because 60 square feet per visa turns rapid hiring into a leasing problem at central Dubai office rates. One limitation on this comparison is also worth stating: package prices for all three sit behind enquiry forms, and we could not verify current package pricing for Dubai CommerCity or Dubai Internet City from an official page, so none is quoted here.

Frequently Asked Questions

Which is better for e-commerce, Dubai CommerCity or Dubai South?

Dubai CommerCity is purpose-built for digital commerce and puts offices, warehousing, and fulfillment on one campus about five minutes from Dubai International Airport, which suits air-freighted parcels. Dubai South’s EZDubai is a 920,000 square meter e-commerce zone inside a much larger logistics city, which suits higher-volume operations that need scale, bonded facilities, and proximity to Al Maktoum International Airport. Volume and freight mode decide it.

Is Dubai Internet City a Designated Zone for VAT?

No. Dubai Internet City does not appear on the Designated Zone list annexed to Cabinet Decision No. 59 of 2017, which is consistent with it being an open office district rather than a fenced, customs-controlled area. That has little practical effect on a software or services business, but it means goods cannot be held there outside the scope of UAE VAT in the way they can in a Designated Zone.

How many visas can I get in Dubai Internet City?

Dubai Internet City allocates one visa per 60 square feet of leased commercial space, so a 600 square foot office supports roughly ten visas. There is no way to add headcount without adding space, which makes the lease decision a hiring decision. Confirm the current ratio and any coworking-specific limits with Dubai Internet City before signing.

Who owns Dubai CommerCity?

Dubai CommerCity is a joint venture between the Dubai Integrated Economic Zones Authority (DIEZ) and Wasl. It was originally launched as a joint venture involving Dubai Airport Freezone Authority, which now sits under the DIEZ umbrella alongside Dubai Silicon Oasis. It is not a TECOM zone, which is a common misunderstanding given its clustered campus format.

What entity type do I register in Dubai South?

Dubai South companies register as a DWC-LLC or as a branch of an existing UAE or foreign company. The published Dubai Aviation City Corporation tariff includes a conversion fee between branch and DWC-LLC, so switching later is possible but chargeable. Confirm current minimum share capital directly with the free zone, as it is not stated in the published fee schedule.

How much does a Dubai South license cost?

Per the published Dubai Aviation City Corporation tariff, a new one-year license is AED 10,000, a general trading license is AED 20,000, and a professional license is AED 7,000, plus an AED 1,000 initial application fee. Those are government charges only. Facility rent, establishment card, and visa costs are separate, and the tariff should be reconfirmed with Dubai South before you budget.

Can a Dubai CommerCity company sell to mainland UAE customers?

Dubai CommerCity offers a dual license with the Department of Economy and Tourism, described as allowing a CommerCity-registered company to obtain a DET license without needing separate physical office space. That is the cleanest route to invoicing mainland customers directly. Without it, selling from a free zone into the mainland generally runs through a distributor or a customs import process.

Do all three zones allow 100% foreign ownership?

Yes. All three are free zones offering full foreign ownership with no requirement for a UAE national partner, which is standard across the free zone model. Ownership is not a differentiator between them. Customs status, facility type, sector fit, and visa mechanics are the factors that actually vary.

Which zone is cheapest to set up in?

None of the three is a budget zone, and only Dubai South publishes itemized government fees, so a like-for-like price comparison is not possible from official sources. Facility rent usually dominates total cost in all three. Request written quotes from each zone for the same facility size and visa count, then compare totals rather than headline license fees.

Can I move my company between these free zones later?

Yes, but it is a re-registration rather than a transfer of the same entity in most cases. The Dubai Aviation City Corporation tariff prices a corporate transfer from another Dubai free zone to Dubai South at AED 5,000, plus the normal licensing costs. Moving also means new visas, a new establishment card, and often a new bank account, so the practical cost exceeds the published fee.

Official Sources

• Dubai South Free Zone — official site
• Dubai Government Media Office — Al Maktoum International Airport expansion
• EZDubai — dedicated e-commerce zone in Dubai South
• Dubai CommerCity — official site and clusters
• Dubai CommerCity — license types and DET dual license
• Dubai Internet City — official FAQs (entity types, capital, visa ratio)
• TECOM Group — Dubai Internet City Innovation Hub
• Dubai Development Authority — regulator for Dubai Internet City
• Federal Tax Authority — UAE Corporate Tax and Free Zone Persons
• Federal Tax Authority — VAT, Designated Zones and Cabinet Decision No. 59 of 2017

All amounts are in UAE dirhams (AED) unless stated otherwise. Dubai South government fees are quoted from the published Dubai Aviation City Corporation tariff of fees and exclude facility rent, VAT where applicable, and third-party charges. Dubai CommerCity and Dubai Internet City package prices are quoted on enquiry and are not published, so any figure elsewhere is indicative and must be confirmed on the relevant zone’s portal as of July 2026.

Information current as of July 2026. Free zone fees, license categories, facility options, visa quotas, and Designated Zone status can change, and their application depends on your specific activity, entity, and facility. This article is general information, not legal or tax advice. Confirm all fees, quotas, Designated Zone status, and eligibility with Dubai South, Dubai CommerCity, Dubai Internet City, and the Federal Tax Authority, or a qualified advisor, before you set up or file.