# Oman Free Zones & Special Economic Zones: Complete Guide

> An overview of Oman's 10 free zones and special economic zones, from Sohar, Salalah, Duqm and Al Mazunah to Khazaen, the Muscat airport free zone and the new Al Dhahirah and Al Rawdah SEZs, with a comparison table, the 2025 law changes and setup steps.

URL: https://omanregister.com/free-zones/
Updated: 2026-10-24
Publisher: Oman Register (omanregister.com) — company registration and residency services in Oman. Contact: +968 7733 3556, info@omanregister.com

## At a glance

- **Regulator:** OPAZ — Public Authority for Special Economic Zones and Free Zones
- **Legal framework:** Royal Decree 38/2025; Executive Regulations, OPAZ Decision 81/2026
- **Zones covered:** 10 free zones, economic city and SEZs
- **Ownership:** Up to 100% foreign in all zones
- **Tax incentive:** 10-year income tax exemption for new enterprises, extendable
- **Customs:** No duty on goods imported into and exported from the zones

Oman has ten free zones, economic city free zones and special economic zones (SEZs), all supervised by the Public Authority for Special Economic Zones and Free Zones (OPAZ). Every zone allows up to 100% foreign ownership, duty-free imports and exports, and an income tax exemption, which is 10 years for new enterprises under the 2025 zones law. The right zone depends on your port or border, your sector and where your customers are. Sohar suits UAE-facing industry, Salalah and Duqm suit Indian Ocean shipping and heavy industry, and Khazaen and the airport zone suit businesses near Muscat.

## Which free zones and SEZs are there in Oman?

| Zone | Location (governorate) | Authority / operator | Best for | Key incentive |
|---|---|---|---|---|
| [Sohar Free Zone](https://omanregister.com/free-zones/sohar-free-zone/) | Sohar, North Al Batinah | OPAZ / SOHAR Port and Freezone | Metals, manufacturing, food, logistics near the UAE | Port next door; legacy tax holiday up to 25 years |
| [Salalah Free Zone](https://omanregister.com/free-zones/salalah-free-zone/) | Salalah, Dhofar | OPAZ / SFZCO (Asyad) | Food, pharma, petrochemicals, transshipment logistics | No minimum capital; legacy holiday up to 30 years |
| [Al Mazunah Free Zone](https://omanregister.com/free-zones/al-mazunah-free-zone/) | Al Mazyunah, Dhofar (Yemen border) | OPAZ / Madayn | Re-export and vehicle trade with Yemen | Yemeni staff can work without Omani visas |
| [Duqm Special Economic Zone](https://omanregister.com/free-zones/duqm-special-economic-zone/) | Duqm, Al Wusta | OPAZ (formerly SEZAD) | Heavy industry, energy, green hydrogen, refining, fisheries | 2,000 km² of land; usufruct up to 50 years |
| [Duqm Industrial City (Customs Zone)](https://omanregister.com/free-zones/duqm-industrial-city-customs-zone/) | Inside Duqm SEZ, Al Wusta | OPAZ | Factories selling to mainland Oman and the GCC | Duty-free movement to mainland Oman |
| [Khazaen Free Zone](https://omanregister.com/free-zones/khazaen-free-zone/) | Barka, South Al Batinah | OPAZ / Oman Logistics Company (Asyad) | Light and medium industry, logistics, trade near Muscat | Two free zones with a land (dry) port |
| [Khazaen Economic City](https://omanregister.com/free-zones/khazaen-economic-city/) | Barka, South Al Batinah | OPAZ / Khazaen Economic City LLC | Factories, warehouses, pharma, food | Serviced land about 30 minutes from Muscat airport |
| [Muscat International Airport Free Zone](https://omanregister.com/free-zones/muscat-international-airport-free-zone/) | Muscat airport, Muscat | OPAZ / Asyad | E-commerce, express cargo, pharma, aviation services | Airside access for air cargo |
| [Al Dhahirah SEZ](https://omanregister.com/free-zones/al-dhahirah-special-economic-zone/) | Ibri, Al Dhahirah | OPAZ | Oman–Saudi logistics, food, manufacturing, mining | About 20 km from the Empty Quarter crossing to Saudi Arabia |
| [Al Rawdah SEZ](https://omanregister.com/free-zones/al-rawdah-special-economic-zone/) | Mahadha, Al Buraimi | OPAZ / Mahadha Development Co. (DP World-led) | Logistics, warehousing, pharma, food, mining | About 10 km from the UAE border, on the Sohar–Jebel Ali route |

Al Dhahirah and Al Rawdah were established by royal decrees in October 2025 and are still in their first development phase. Check the status before you plan to start operations there.

## What changed under the 2025 Special Economic Zones and Free Zones Law?

Royal Decree 38/2025, in force since 14 April 2025, replaced both the 2002 Free Zones Law and the separate Duqm SEZ law with one framework. The main points:

- **Tax:** new qualifying enterprises receive a **10-year income tax exemption** from the start of operations, extendable for two further periods for high value-added activities. Banks, insurers, telecoms, contracting and land or sea transport companies are excluded.
- **Customs:** goods imported into and exported from the zones are not subject to customs duty.
- **Ownership and capital:** up to 100% foreign ownership, with minimum capital waivable subject to approval.
- **Real estate:** licensed developers may sell units to foreigners on a freehold basis.
- **Existing companies** keep their earlier incentives (up to 25–30 years) until those periods expire.

OPAZ issued the Executive Regulations (Decision 81/2026) in September 2026. They cover the one-stop shop, electronic licensing, strategic projects, off-plan sales with escrow accounts, and residency for investors and property owners and their families. Large multinational groups should also check how Oman's domestic minimum top-up tax affects the value of any exemption.

## Free zone vs SEZ vs mainland: what is the difference?

| Point | Free zone | Special economic zone | Mainland company |
|---|---|---|---|
| Area and scope | Defined area, often port- or airport-linked | Very large area that can include towns, tourism and real estate | Anywhere in Oman |
| Foreign ownership | Up to 100% | Up to 100% | Up to 100% for most activities |
| Customs | Duty-free inside; mainland sales pay duty | Duty-free inside; mainland sales pay duty | Normal customs; free movement within Oman and the GCC |
| Income tax | 10-year exemption (new enterprises) | 10-year exemption (new enterprises) | Standard corporate income tax |
| Omanisation | Reduced zone rates | Reduced zone rates | Sector rates set by the Ministry of Labour |
| Premises | Land, warehouse or office in the zone | Land or unit in the zone | Office or virtual office, depending on activity |

A [mainland company](https://omanregister.com/mainland-company-registration-oman/) is usually better for services, consulting and selling to Omani customers. [Madayn industrial cities](https://omanregister.com/industrial-cities/) sit inside the customs territory and suit factories that mainly sell in Oman and the GCC.

## How do you choose the right Oman free zone?

1. **Follow your goods.** Choose the zone next to the port, airport or border your cargo actually uses: Sohar or Al Rawdah for the UAE, Al Dhahirah for Saudi Arabia, Salalah or Duqm for ocean shipping, Al Mazunah for Yemen, the airport zone for air freight.
2. **Check where you sell.** If most sales are in Oman, the customs duty on zone-to-mainland sales can cancel out the zone benefits.
3. **Match the sector.** Each zone targets particular clusters, and some activities, such as holding-only companies, are generally not licensed in zones.
4. **Compare premises.** Ready warehouses and offices speed up setup. Bare land suits large factories.
5. **Confirm the incentives in writing.** Ask the operator for the exact tax exemption, Omanisation rate and lease terms that apply to your licence date.

Our [Duqm vs Sohar vs Salalah comparison](https://omanregister.com/comparison-duqm-vs-sohar-vs-salalah-freezone-2026-guide/) and the [Oman free zone company registration guide](https://omanregister.com/oman-free-zone-company-registration-the-2026-complete-guide/) go into more detail.

## What are the general steps to set up in an Oman free zone?

1. **Project profile and enquiry.** Describe the activity, investment, jobs, space and utilities.
2. **Application and initial approval** from the zone operator or OPAZ one-stop shop.
3. **Land or facility allocation** and signing of the usufruct or lease agreement.
4. **Company registration and activity licence.** Usually an LLC, a single-owner company or a branch.
5. **Permits.** Building, environmental and civil defence permits for industrial projects.
6. **Chamber membership, tax registration, visas and bank account.**

Typical documents are shareholder passports, a business plan, and corporate shareholder documents (incorporation certificate, articles, board resolution, power of attorney), legalised and translated where required. Zones rarely publish all-in prices. Expect registration and licence fees, Chamber membership, rent per m² per year, utility charges, and visa costs, all quoted case by case.

## How Oman Register helps

Oman Register compares zones, industrial cities and mainland options for your specific activity. We obtain written offers from the operators, then handle the application, registration, visas and bank account support from our Muscat office. Start with our [overview of company registration options in Oman](https://omanregister.com/register-company-in-oman/).

## FAQ

**How many free zones are there in Oman?**

Oman's main operating zones are the Duqm SEZ and the Sohar, Salalah and Al Mazunah free zones. Newer zones include the Khazaen Economic City free zones, the Muscat International Airport Free Zone and the Al Dhahirah and Al Rawdah SEZs. All are supervised by OPAZ.

**What is the difference between a free zone and a special economic zone in Oman?**

A free zone is a defined area, usually linked to a port or airport, for industry, logistics and trade. A special economic zone is a much larger area that can also include towns, tourism and real estate. Since 2025 both fall under one law with similar incentives.

**What tax holiday do Oman free zones give in 2026?**

New qualifying enterprises receive a 10-year income tax exemption from the start of operations under Royal Decree 38/2025, extendable for high value-added activities. Companies licensed earlier keep their previous incentives, which were up to 25–30 years, until they expire.

**Can a free zone company sell in mainland Oman?**

Yes, but goods moving from a zone into Oman's customs territory are normally treated as imports and pay customs duty. To sell mainly to the Omani market, a mainland company or an industrial city is often simpler.

**Do I need an office or land to register in an Oman free zone?**

Generally yes. Zone licences are linked to leased land, a warehouse or an office under a usufruct or lease agreement, so they are not 'licence-only' setups.

**Is 100% foreign ownership only possible in free zones?**

No. Most activities on the mainland can also be 100% foreign-owned under the Foreign Capital Investment Law. Zones add customs and tax exemptions and reduced Omanisation, not just ownership.

## Sources

- [OPAZ — Sohar Free Zone](https://opaz.gov.om/en/zones/sohar-free-zone)
- [OPAZ — Salalah Free Zone](https://opaz.gov.om/en/zones/salalah-free-zone)
- [OPAZ — Al Mazunah Free Zone](https://opaz.gov.om/en/zones/al-mazunah-free-zone)
- [OPAZ — Special Economic Zone at Duqm](https://opaz.gov.om/en/zones/special-economic-zone-at-duqm)
- [KPMG — Oman issues law for special economic zones and free zones (2025)](https://kpmg.com/om/en/insights/2025/06/oman-issues-law-for-special-economic-zones-and-free-zones.html)
- [EY — Oman issues law on special economic zones and free zones](https://www.ey.com/en_gl/technical/tax-alerts/oman-issues-law-on-special-economic-zones-and-free-zones)
- [Times of Oman — Executive Regulations issued (2026)](https://timesofoman.com/article/177163-executive-regulations-issued-for-special-economic-zones-and-free-zones-law)
- [Oman News Agency — Al Dhahirah and Al Rawdah SEZs established (2025)](https://omannews.gov.om/topics/en/80/show/124890)
- [DP World — Agreement to develop Al Rawdah SEZ (2025)](https://www.dpworld.com/en/news/releases/uae/dp-world-and-opaz-sign-landmark-agreement-to-develop-al-rawdah-special-economic-zone-in-oman)
- [Decree.om — Royal Decree 44/2023 establishing Khazaen Economic City](https://decree.om/2023/rd20230044/)
- [Oman Observer — Asyad to operate Muscat International Airport Free Zone (2023)](https://www.omanobserver.om/ampArticle/1146727)
- [Qanoon — SEZAD Decision 30/2017 (customs-territory site in Duqm)](https://qanoon.om/p/2017/sezad20170030/)