Overview
Oman’s Free Zone Framework encompasses the legal, regulatory, and institutional arrangements governing the establishment and operation of free zones and special economic zones across the Sultanate. The framework provides a competitive investment environment by offering incentives including corporate tax exemptions, customs duty waivers, unrestricted capital repatriation, and the right to 100 percent foreign ownership. Each free zone is established by specific legislation and operates under the oversight of the Public Authority for Special Economic Zones and Free Zones (OPAZ). The framework covers four major zones: the Special Economic Zone at Duqm, Sohar Free Zone, Salalah Free Zone, and Al Mazunah Free Zone near the Yemen border, each targeting specific industrial and commercial activities.
Key Facts
- Legal framework established through Royal Decrees and specific zone legislation
- Incentives include tax exemptions, customs waivers, and full foreign ownership
- Four major zones: Duqm SEZ, Sohar Free Zone, Salalah Free Zone, Al Mazunah
- OPAZ provides unified regulatory oversight across all zones
- Each zone has distinct sector focus and competitive advantages
- Unrestricted capital and profit repatriation for zone investors
- Streamlined business registration and licensing procedures within zones
Significance for Vision 2040
The Free Zone Framework is a critical component of Vision 2040’s strategy for attracting foreign direct investment and developing export-oriented industries. By offering internationally competitive incentives within defined geographic areas, the framework allows Oman to attract investment that might otherwise go to regional competitors while maintaining different regulatory standards on the mainland. The geographic distribution of free zones across the country, from Sohar in the north to Salalah in the south and Duqm on the central coast, supports Vision 2040’s balanced regional development objective. Each zone’s sector specialization creates complementary rather than competing investment destinations. The framework’s emphasis on ease of doing business, including one-stop-shop services and streamlined regulation, demonstrates the type of business environment reform that Vision 2040 aims to extend nationwide over time.