Free Zones and GHG Reporting: Are You Exempt?

The Exemption Myth

"We are in a free zone, so federal regulations don't apply to us." This is one of the most persistent misconceptions in UAE business. While free zones offer autonomy in company formation and taxation, Federal Decree-Law No. 11/2024 on GHG emissions applies uniformly across the entire UAE.

The Law Is Clear: No Exemptions

As a federal decree-law — the highest level of legislative authority — it applies to all seven emirates, all mainland entities, all free zone entities, and all designated zones including financial free zones (DIFC, ADGM). There is no carve-out.

Major Free Zones

• JAFZA — hosts major industrial operations; many tenants qualify under multiple Phase 1 criteria. DP World's own sustainability commitments don't substitute for individual tenant reporting.
• DMCC — world's largest free zone by company count. Trading firms may fall below thresholds, but those meeting criteria must comply.
• DIFC — federal environmental legislation supersedes DIFC's regulatory autonomy. Large financial institutions likely meet the thresholds.
• ADGM — same principle. GHG reporting is becoming a baseline regulatory expectation.
• Others — DAFZA, Dubai Silicon Oasis, Masdar City, SAIF Zone, RAK Economic Zone, KIZAD, twofour54, Dubai Healthcare City — all in scope.

Why the Confusion Persists

• Historical autonomy in other regulatory domains
• Lack of proactive communication from some free zone authorities
• Incorrect extrapolation of tax exemptions to environmental obligations
• Environmental regulation is new territory for the UAE

Do not rely on your free zone authority to notify you. The legal obligation falls on the individual entity.

Check Your Status Now

Free zone or mainland — check your status now. SmartFenek's eligibility assessment works for all UAE entities regardless of registration. Find out in minutes whether you need to report.