RAK Innovation City Free Zone 2026: Setup, Packages, CMA Rules, Visas and Tax (ex RAK DAO)

RAK Innovation City free zone is Ras Al Khaimah’s technology-focused free zone, licensed by the Innovation City Authority under Ras Al Khaimah Law No. 2 of 2023, which began as RAK Digital Assets Oasis (RAK DAO) and relaunched as Innovation City in October 2025. An Innovation City free zone company can be wholly foreign-owned, is set up online with a registered address at Innovation HQ in Ras Al Khaimah, sponsors a limited number of residence visas through ICP, and is known for AI, Web3, gaming, robotics and digital health start-ups, with regulated financial and virtual asset activity supervised separately by the federal Capital Market Authority.

Most people still search for RAK DAO or the RAK DAO free zone. The name changed, but the legal entity types, the regulations and much of the Web3 community carried over. What changed is scope: RAK DAO was built around digital and virtual assets, while Innovation City presents itself as a general technology zone, with AI placed first. Its chief executive told Khaleej Times in October 2025 that “Ras Al Khaimah needed a free zone dedicated to technology and innovation, rather than one focused on a single trend”.

This guide explains what Innovation City is, who regulates what, the legal forms and packages, the setup steps and documents, the Innovation City license cost as published, visas, banking, tax and ongoing compliance, and when another zone fits better. If you are comparing free zones with the mainland in general, see our free zone vs mainland guide. If you want the file prepared and the government steps handled, our company formation support covers Ras Al Khaimah free zones as well as Dubai.

Innovation City, Ras Al Khaimah is one of two free zone authorities listed for the emirate on u.ae, alongside RAKEZ. For the emirate as a whole, read our Ras Al Khaimah free zones guide; for the national picture, the free zones in the UAE pillar guide. The facts below come from innovationcity.com, its published regulations and the federal sources listed at the end, read on 26 September 2026. Where Innovation City’s own pages disagree, we show both.

RAK Innovation City free zone at a glance

For most founders the practical decision is between Innovation City, Ras Al Khaimah, the RAKEZ free zone next door, and a Dubai technology zone. Innovation City wins on sector focus, digital setup and bank partnerships for tech founders; it loses on visa numbers and physical space. If you are also weighing Dubai for business setup in Dubai, we compare the routes in writing.

From RAK DAO to Innovation City: what changed

Ras Al Khaimah Law No. 2 of 2023 created the authority that launched as RAK Digital Assets Oasis, a free zone for digital and virtual asset businesses. Its Companies Regulations 2023, still in force and published on innovationcity.com, were issued by the Authority’s board under that law. In October 2025 the zone relaunched as Innovation City, describing itself as the “world’s first AI-powered free zone”, with AI used in its registry and compliance systems and on-chain licensing.

According to the October 2025 interview, the zone now concentrates on five main industries: Web3, digital assets, AI gaming and iGaming, robotics and digital health. Its website lists a wider set: artificial intelligence, robotics and physical AI, Web3, gaming and interactive media, digital health, creator economy, transportation technology, blockchain, cybersecurity, education technology and climate technology, and its FAQ adds quantum computing.

In July 2026 Innovation City and Siada, an IOPn company, announced a sovereign AI data centre inside the zone, offering GPU compute to companies licensed there. For AI founders who need in-country compute and data residency, that is a genuine differentiator.

RAK ICC and RAKEZ are separate

Innovation City is not part of RAKEZ, which is a separate general and industrial free zone authority; see our RAKEZ company setup guide. RAK International Corporate Centre (RAK ICC) is an offshore company registry, not a free zone.

Regulated activities and the Capital Market Authority

This is the most important point in any RAK Innovation City free zone setup. Innovation City’s home page says it “is a commercial freezone. Any activity falling within the regulatory mandate must be submitted to CMA for supervision and cannot be undertaken unless and until the entity has obtained the required full license or approval from CMA.” The link goes to the federal Capital Market Authority, the renamed Securities and Commodities Authority (sca.gov.ae).

Innovation City’s Companies Regulations say the same in legal terms (Regulation 9): no company may carry on business in the UAE, inside or outside the zone, without first obtaining all licences required by the competent UAE authorities, and the zone accepts no liability if a company fails to do so.

Which activities need more than an Innovation City free zone licence

In practice, a Web3 software studio, a blockchain developer or an NFT game can usually operate on an Innovation City free zone licence alone. A business that holds client assets, exchanges tokens for money or gives regulated investment advice needs the CMA first. Plan the CMA application before you pay for a package, because a licence without the approval does not let you trade.

Innovation City free zone company setup: legal forms, shareholders and capital

Innovation City’s legal entity page also refers to “Limited” and “Incorporated” styles of company limited by shares. The Regulations require share capital of at least “the minimum share capital required by the Authority from time to time”, but no figure is published, so ask for it in writing. Shares for non-cash consideration need valuation by an auditor listed with the Authority.

Directors, manager and secretary

• One or more directors, each at least 18, not disqualified by a dishonesty conviction in the past ten years, a sanctions listing or bankruptcy (Regulation 43).
• Director appointments take effect only once the Registrar records them; removals must be notified within 14 days (Regulation 44).
• A shareholder, director or secretary may also be the manager, and a secretary may be a director (Regulations 50 and 51).
• The company must keep a registered office in the zone and carry on its principal business there unless permitted otherwise (Regulation 20).

Innovation City license cost: packages and what they include

The Innovation City license cost is published as four annual packages, which makes the Innovation City free zone one of the more transparent tech zones on price. Its FAQ says the package price “includes license fees, lease fees, and workspace”, and that extra costs apply only for additional visas, premium activities or premium office space.

All packages include access to Innovation HQ’s event space and content studio. Innovation City also says it offers discounted multi-year packages, but its FAQ entry on multi-year pricing shows no figures, and it accepts bank transfer, card, cheque and cryptocurrency payments.

Worked cost examples from the published prices

• Solo founder needing residence: Seed package, AED 13,200 a year with one visa. If the founder later needs a second visa, Seed cannot provide it; the company moves to Startup.
• Two founders both needing visas: Startup at AED 15,400 plus one extra visa at AED 4,400 = AED 19,800 in year one.
• Team of four on a dedicated desk: Growth at AED 22,550 plus three extra visas at AED 4,400 = AED 35,750.

These Innovation City license cost totals use only the published figures. Premium activities, dependants’ visas, CMA fees, attestation, bank fees and audit are extra. The Seed terms are marked as a September offer, so check which version applies on the day you sign.

RAK Innovation City free zone setup process

Innovation City, Ras Al Khaimah describes four steps and a mostly online process; no physical presence is required to incorporate in the Innovation City free zone.

1. Choose your activities. From 200+ technology activities, with Innovation City’s team mapping your model to activity codes. Decide at this stage whether any activity needs a CMA or Central Bank licence. Time: your preparation.
2. Apply and upload documents. Online, or in person with the HQ concierge team. Innovation City also offers an AI business plan tool. Time: at your pace.
3. Review and approval. Business activity assessment, KYC and due diligence, compliance review and document verification. “Standard activities are typically approved within days.” Time: see below.
4. Licence issued digitally. Once approved and fees are paid, the licence issues immediately, with a registered address at Innovation HQ. The Innovation City free zone says licences are issued “in as little as 5-10 working days”, while another line on the same page promises “same-day licensing for many activities”.
5. Immigration file and visas. Through Innovation City’s immigration and visa services on the ICP system.
6. Bank account. Innovation City advertises “simultaneous banking setup” with partner banks.
7. Tax registration. Corporate tax registration within three months of incorporation (FTA Decision No. 3 of 2024), and VAT once taxable supplies exceed AED 375,000.

Our reading: the 5 to 10 working day figure is the safer planning assumption, and u.ae’s general statement that free zone applications are approved “within 14 working days” is a sensible outer bound for standard activities. Anything needing CMA approval runs on the CMA’s timetable, not the zone’s.

Innovation City documents required

Innovation City’s application process page and document checklist list the following:

Individual shareholders

• Valid passport copy.
• Proof of address: utility bill, bank statement or tenancy contract.
• UAE residence visa and Emirates ID if you live in the UAE; otherwise the entry stamp and passport signature pages.
• Business plan and, if someone acts for you, a power of attorney.
• Source of wealth for investments above USD 250,000, and source of funds if requested during processing.

Corporate shareholders

• Certificate of incorporation or commercial register extract, and trade licence if applicable.
• Memorandum and articles of association.
• Board or shareholders’ resolution.
• Certificate of incumbency (issued within the last three months) or certificate of good standing.
• UBO declaration with passport copies and address proof of the beneficial owners.

The Innovation City free zone says documents must be “valid, current, and duly attested as per the jurisdiction of registration”. For a foreign parent that usually means notarisation and apostille or legalisation; our document attestation service can handle the chain.

Innovation City visas and residency

Because the zone is Innovation City, Ras Al Khaimah, visas for Innovation City free zone companies are Ras Al Khaimah residence visas issued on the federal system of the Federal Authority for Identity, Citizenship, Customs and Port Security (ICP); residence file numbers begin with 6. Innovation City includes E-Channel registration, entry permit, status change, medical examination, Emirates ID, insurance and stamping in its AED 4,400 visa fee. Our ICP vs GDRFA guide explains the difference from Dubai files.

• Visa caps: none on Idea, one on Seed, up to four on Startup and Growth. A team of five or more needs premium office space or another zone.
• Steps: entry permit or status change, medical fitness test, Emirates ID biometrics (see our Emirates ID typing service) and residence stamping.
• Family: visa holders who meet the salary and housing conditions can sponsor family through ICP.
• Golden Visa: founders and investors who meet federal criteria can apply separately; see our Golden investor visa service.

Innovation City does not publish visa processing times. Remote founders who do not need residence can use the Idea package and stay abroad, but UAE banks usually prefer at least one resident signatory.

Banking for Innovation City free zone companies in Ras Al Khaimah

Innovation City’s FAQ lists its banking partners: RAKBANK (local onboarding, dirham business banking, payroll), Ruya Bank (zero-balance corporate account at AED 79 a month), Wio Bank (priority onboarding through a dedicated partner desk), Amina Bank (institutional custody), Ibanera (multi-currency accounts for Web3 start-ups), CBI and M Bank. A partnership speeds the introduction, not the bank’s decision: banks still apply their own risk appetite, and crypto-linked businesses face the most questions. Our guide to the corporate bank account in the UAE explains what banks look for.

RAK Innovation City free zone tax

Corporate tax

Innovation City free zone companies are within UAE corporate tax: 0% up to AED 375,000 of taxable income and 9% above. A company can pay 0% on qualifying income as a Qualifying Free Zone Person (Cabinet Decision No. 100 of 2023), but only income from the qualifying activities in Ministerial Decision No. 229 of 2025 counts (it replaced Ministerial Decision No. 265 of 2023 with effect from 1 June 2023). Those activities include holding shares, fund and wealth management, headquarters and treasury services to related parties, manufacturing, and trading of qualifying commodities. Software development, SaaS subscriptions, consulting and most digital services sold to third parties are not on the list, so for a typical tech start-up the 0% regime brings little and the de minimis limit (the lower of AED 5 million or 5% of revenue) is easily exceeded. Small Business Relief is available to eligible businesses but not to Qualifying Free Zone Persons, so a small tech company may be better off opting out of the free zone regime. Take tax advice; see our corporate tax registration guide.

VAT

Innovation City does not appear on the Cabinet Decision No. 59 of 2017 designated zones list (in the secondary copies we read on 26 September 2026; the FTA page could not be read automatically). That matters little for software and services, which are taxed under normal VAT rules; register once taxable supplies exceed AED 375,000.

Trading with the mainland from Innovation City

Regulation 9 of the Companies Regulations says a company must hold all licences the competent UAE authorities require before doing business “inside or outside the Zone”. In practice, digital services sold online to customers in the UAE and abroad are the core of most Innovation City businesses. Where you need a physical presence or an office on the mainland, or to sell regulated products, you need the relevant emirate or federal licence. Dubai’s Resolution No. 11 of 2025 permit route was written for Dubai’s own free zones, so ask Dubai’s Department of Economy and Tourism which licence applies to a Ras Al Khaimah free zone company. See our Dubai mainland company formation guide.

Innovation City renewal and ongoing compliance

Our UBO register guide covers beneficial owner filings in detail.

RAK Innovation City free zone: pros and cons

Who Innovation City suits

• AI, SaaS, gaming, robotics and digital health start-ups needing one to four visas.
• Web3 and blockchain developers whose activities do not require a CMA licence, or who will obtain one.
• Remote founders who want a UAE company without relocating (Idea package).
• Non-profits and communities using a company limited by guarantee or DAO association.

Who should look elsewhere

• Teams needing many visas or physical space: RAKEZ.
• Crypto businesses serving Dubai clients under VARA: DMCC or DWTC Free Zone; for financial services, ADGM.
• Tech firms wanting a Dubai address and ecosystem: Dubai Internet City.
• Manufacturing or port-based projects: RAK Maritime City.

RAK Innovation City free zone: worked cases

These cases are built from the situations we see most often. Names and identifying details are left out, and the figures are the published ones.

Case 1: an AI start-up with two founders

Two founders, one abroad and one in Dubai on an employer’s visa, build an AI analytics product. The Startup package (AED 15,400) includes one visa; the second founder keeps their current visa for now. When they hire two engineers, two more visas at AED 4,400 each take them to the cap of four. We map the hiring plan against that cap on day one, because the fifth hire forces a move.

Case 2: a Web3 team that wanted to run an exchange

A team planned a token swap platform with fiat on-ramps. That is a virtual asset service within the Capital Market Authority’s mandate, so an Innovation City free zone licence alone would not allow it. The team split the plan: an Innovation City free zone company to build and license the software, and a separate CMA application for the regulated service, with legal counsel. Nothing regulated went live before approval.

Case 3: a remote SaaS founder with no plans to relocate

A founder abroad wants a UAE company to sign regional contracts. The Idea package (AED 6,600, no visa) provides a licence and shared desk. The risk is banking: without a UAE-resident signatory, several banks will decline or delay, so we discuss partner banks’ requirements and whether a Seed package with one visa is worth the extra AED 6,600.

Case 4: a European games studio opening a branch

A studio registered in Europe opens a branch rather than a new company, keeping contracts in the parent’s name. It needs the parent’s certificate of incorporation, articles, board resolution and a certificate of incumbency issued within three months, all attested for its jurisdiction, plus UBO documents. The corporate tax analysis matters: game revenue from players is not qualifying income, so the branch plans for the standard rates.

What circulates online about the Innovation City free zone that is not true

How to verify every figure in this guide

RAK Innovation City free zone setup: how MIRDXB PRO helps

MIRDXB PRO is an independent PRO and company formation consultancy in Al Barsha 1, Dubai. We are not Innovation City, not one of its registered agents, and Innovation City does not list us. We act for you and are paid by you, not by the zone.

What we do

• Check your activities for CMA, Central Bank or other regulatory triggers before you pay a package.
• Recommend the package and legal form against your visa and shareholder plan.
• Prepare the application and business plan, and run notarisation, apostille or legalisation for corporate shareholders.
• Follow licensing, visas and Emirates ID through to completion.
• Prepare the bank pack and register the company for corporate tax and, where needed, VAT.
• Keep renewals, annual returns, UBO changes and visa renewals on a calendar.

How it works

1. Message us on WhatsApp with your activity, shareholders and visa needs.
2. We reply in writing with the package, any regulatory issues, the documents and our fee.
3. You approve; we prepare and submit, and keep you updated.
4. After licensing we run visas, banking and tax registration, then hand over a compliance calendar.

What it costs

Innovation City and government fees are passed on at cost with receipts. Our own fee is quoted in writing before we start; see our fees page.

Why founders use us

• We cite the zone’s own rules and flag where its pages conflict, as in this guide.
• We compare Innovation City with RAKEZ and Dubai technology zones and tell you when it is not the right fit.
• We handle visas, Emirates ID, medical tests, attestation and tax registration under one roof.
• Our Al Barsha 1 office is open Monday to Thursday and Saturday 09:00 to 18:00, and Friday 09:00 to 12:00.

To start, see our business setup service or message us.

What we will and will not do

• We will show you the official source for each rule and every receipt.
• We will tell you when RAKEZ, a Dubai zone or the mainland fits better.
• We will quote our fee in writing before we start.
• We will not promise approval, a bank account or a CMA licence, or timings that Innovation City, ICP, the CMA or a bank controls.
• We will not present ourselves as Innovation City or its agent.
• We will not give legal, regulatory or tax opinions on virtual asset activities; we work alongside your lawyers and tax advisers.

Related guides

• Ras Al Khaimah free zones
• RAKEZ company setup
• RAK Maritime City free zone
• Dubai Internet City company setup
• DMCC company setup
• Free zones in the UAE
• Establishment card explained

Keeping your Innovation City free zone licence, annual return, UBO records and visas up to date is what our PRO services in Dubai team handles, including for companies in Ras Al Khaimah. For visa-only support, see our free zone visa service.