Mainland Company Formation in Dubai

For two decades the mainland argument wrote itself. A free zone company could not invoice a customer in Deira, so if you sold to the UAE you licensed with the Department of Economy and Tourism and paid for the privilege. That sentence still appears on most consultancy websites in this city. In Dubai it stopped being reliably true on 3 March 2025.

What follows is what a DET licence gives you now, which activities still require an Emirati shareholder or a local service agent — named rather than gestured at — how the file is assembled and in what order, what it costs, and when a mainland licence is the wrong instrument for what you are building.

What a DET licence buys, and the advantage it stopped monopolising

A mainland licence is issued by the Department of Economy and Tourism, formerly the DED, through the Invest in Dubai platform. Three things follow that a free zone licence does not confer by default.

Unrestricted commercial reach inside the UAE. You contract with, invoice and deliver to customers anywhere in the country with no distributor, agent or second entity between you and the revenue. A Dubai licence sells into all seven emirates and stands in only one, which is why having customers elsewhere is a different question from holding premises and staff elsewhere.

Eligibility for public sector work. Dubai government procurement runs under Law No. 12 of 2020 Concerning Contracts and Warehouse Management in the Government of Dubai, in force since 1 January 2021, which establishes a central supplier record that entities buy through. A Dubai-issued trade licence is what gets you into it.

Physical presence wherever zoning allows. Retail units, clinics, workshops, restaurants, showrooms, schools. A free zone licence confines you to the zone's estate; a mainland licence puts the whole emirate in play.

A fourth item on most mainland lists belongs to the whole country. Brochures add freedom from currency restrictions and full repatriation of profit as a mainland benefit. The substance is sound: the Ministry of Economy and Tourism states that investors may repatriate their profits in full, the Central Bank holds the dirham at a fixed parity with the US dollar, and a mainland company can hold accounts in, contract in and be paid in the major foreign currencies alongside dirhams, where its bank offers them. None of that comes from the licence. A free zone company has exactly the same freedom, so it should carry no weight when you choose between the two. Two limits are worth knowing before relying on it. The tax file does not follow your trading currency: the corporate tax law requires every amount to be quantified in dirhams and converted at the Central Bank's rate, so a business invoicing in euros still files in dirhams. And what actually holds up a transfer abroad is not an exchange control but the bank's own compliance file — the subject of repatriating profit from a UAE company. What the dollar peg quietly does to your loans, prices and tax conversions is in your UAE company is a dollar business.

Now the part that changed. Executive Council Resolution No. 11 of 2025, published in the Official Gazette on 3 March 2025 with immediate effect, allows Dubai free zone establishments — every zone except the DIFC — to apply to DET for either a licence to operate a branch within the emirate or a permit to carry out specified activities for up to six months. Article 9 directs DET, with the free zone licensing authorities, to publish the list of activities available through each route. Entities already trading outside their zone were given a year to regularise, extendable by another.

Reported fees sit near AED 10,000 a year for the branch licence and AED 5,000 for the permit, and the establishment must keep separate financial records for out-of-zone activity, which DET may inspect. Confirm both figures — the schedule is administered by DET, not fixed in the text.

So "a free zone company cannot sell to the mainland" is now a Dubai-specific half-truth. It holds in the other emirates, and in Dubai for activities DET has not opened. But where local market access was your only reason for going mainland, that reason is now a cost comparison rather than a legal necessity.

Ownership: precisely what changed in 2021, and precisely what did not

The 51% rule went. Federal Decree-Law No. 26 of 2020, published in the Official Gazette in September 2020, removed both the requirement for a UAE national to hold a majority of an onshore company and the requirement for a foreign company's branch to appoint a national agent. Dubai's economic department announced its list of eligible activities on 20 May 2021 and applied it from 1 June 2021, covering more than 1,000 commercial and industrial activities. The Commercial Companies Law was then replaced wholesale by Federal Decree-Law No. 32 of 2021, in force since 2 January 2022 and the current statute.

Two carve-outs survive. They are different in kind, and confusing them is the standard error here.

The seven strategic-impact sectors

Cabinet Resolution No. 55 of 2021 determines the List of Activities with a Strategic Impact. It is a short list, and it is the whole of the federal restriction.

Six of these are not flat prohibitions. The sector regulator decides what percentage a foreign investor may hold, case by case, on an application routed through the emirate's economic department. If your activity sits here the answer is not "you need a 51% partner" — it is "the regulator sets the number, and you ask before designing the cap table."

Everything outside this list is federally open to full foreign ownership, and the operative constraint becomes the emirate's own activity record. We check the code against that record before drawing a structure, rather than inferring it from the sector.

The local service agent: who still needs one, and what they are not

The federal amendment addressed commercial companies. Professional licensing is administered at emirate level and was not swept up in it. In Dubai the position, as DET applies it, is narrower than most pages admit and broader than founders expect:

• A professional sole establishment owned by a non-GCC national — a management consultant, an engineer enrolled with Dubai Municipality's engineering affairs department, a DHA-licensed physician, a legal consultant — is issued against a local service agent agreement.
• A civil company of professional partners who are not GCC nationals is typically issued on the same basis.
• Commercial and industrial LLCs on the eligible activity record need neither an agent nor an Emirati shareholder.
• Branches of foreign companies need neither, since 2021.

A local service agent is a UAE national appointed under a notarised agreement to act as your interface with government departments. The agent holds no shares, no entitlement to profit, no signing authority over the bank account and no say in management, and can be replaced.

The commercial character of that arrangement matters. It is a privately negotiated annual contract, not a government tariff — there is no published rate, and quotes commonly land between AED 5,000 and AED 10,000 a year depending on the activity and how much liaison the agent genuinely performs. A shareholder is a permanent claim on your equity, your exit and your dividend policy. Marketing material conflates the two constantly; they are not comparable commitments.

Branches: two requirements that quietly disappeared

If you are extending an existing overseas company rather than starting a new one, the file has become materially lighter and most published guidance has not caught up.

Branches established before mid-2024 that lodged the AED 50,000 guarantee should ask their bank to release it. Nobody will return it to you unprompted.

Every rule on this page arrived on a date, and the dates are not evenly spread.

Read the gaps rather than the entries: Federal Decree-Law No. 26 of 2020 took away the shareholding rule and the branch agent in September 2020, Law No. 12 of 2020 put Dubai procurement on a central supplier record from 1 January 2021, Dubai applied its list of more than 1,000 eligible activities from 1 June 2021 and Federal Decree-Law No. 32 of 2021 replaced the companies statute on 2 January 2022 — then a long quiet, until Ministerial Resolution No. 138 of 2024 released the AED 50,000 branch guarantee on 30 July 2024 and Executive Council Resolution No. 11 of 2025 opened DET to free zone establishments on 3 March 2025.

five years of company law, unevenly spread

1. Sep 2020Majority-Emirati shareholding and the branch's national agent both goFederal Decree-Law No. 26 of 2020
2. 1 Jan 2021Dubai procurement moves onto a central supplier recordLaw No. 12 of 2020
3. 1 Jun 2021Dubai applies its list of more than 1,000 eligible activitiesDubai's economic department
4. 2 Jan 2022The companies statute is replaced wholesaleFederal Decree-Law No. 32 of 2021
5. 30 Jul 2024The AED 50,000 branch guarantee is releasedMinisterial Resolution No. 138 of 2024
6. 3 Mar 2025DET opens to Dubai free zone establishmentsExecutive Council Resolution No. 11 of 2025

Growing into a second site or a second emirate takes a branch licence, not a second company

Once the first licence is working, the expansion most founders need is not a new company but a branch of the one they already have — a second shop, clinic or showroom elsewhere in Dubai, or an office in Abu Dhabi or Sharjah. Invest in Dubai describes the branch as an extension of an existing local or international company that remains legally dependent on its parent, and that dependence is the whole character of the form.

• It is the same company. No new shares, no new memorandum, no separate legal person. The branch's contracts and debts are the company's, with no firewall between the two sites.
• It is still a separate licence. Each additional place of business is licensed against its own premises and its own tenancy. In Dubai that licence comes from DET; in another emirate it comes from that emirate's economic department, on that department's rules and fees.
• Corporate tax does not duplicate. The Federal Tax Authority treats a UAE branch of a domestic company as an extension of its head office rather than a separate juridical person, so the branch does not enrol separately and its income goes into the company's own return. If you want to know whether the second site earns its cost, your books have to show it, because the tax file will not.
• The labour file is a question to settle first. Whether a branch in another emirate draws work permits on your existing MOHRE establishment or needs a file of its own is one to put to MOHRE before anyone is hired there.

Two distinctions stop founders buying a branch they do not need. Serving a customer in another emirate is generally a question about your activity rather than your address; it is holding premises and staff there that calls for a branch. And a branch is the wrong tool where the aim is to ring-fence the risk of the new venture or give someone equity in it alone. That needs a second company — ordinarily an LLC owned by the first, which is what the market calls a subsidiary. The full cross-emirate picture, including what VAT does with two establishments, is in your licence was issued by one emirate.

the choice founders make before they know it is a choice

1. 01Confirm the new site needs premises and staff, not only customers thereServing a customer in another emirate is a question about your activity, not your address
2. 02Expect a separate licence either wayEach place of business is licensed against its own premises and its own tenancy
3. 03Ask MOHRE about the labour file before anyone is hired thereWhether the site draws work permits on your existing establishment or needs its own
4. Do you need to ring-fence the new venture's risk, or give someone equity in it alone
5. Neither of thoseThe same company — no new shares, no new memorandum, its income in one tax return
6. One or bothAn LLC owned by the first: a separate legal person, parent exposure capped at its capital
7. A branch cannot ring-fence anythingThere is no firewall between the two sites, because they are one company

The activity code decides the licence category before you have chosen anything

Federal guidance on the UAE government portal lists six licence types: commercial, professional, industrial, tourism, agricultural and crafts. None of them is picked from a menu. The activity you select from DET's classification sets the category, and a Dubai mainland file almost always lands in one of four.

Run it the other way — from what the business actually does to the door it opens — and the four categories stop being a menu.

Trading, distribution, retail and most services land on a commercial licence; consultancy, engineering, design, medical and legal practice on a professional one; manufacturing, production, packaging, sorting and collection on an industrial one; and hotels, holiday homes, timeshare, travel and tour companies on a tourism one. Most services being commercial rather than professional is the one founders get wrong.

Two consequences follow. Activities on one licence are generally expected to sit in one category, so a business that both consults and trades is usually looking at two licences — a structural decision, not a form field. And the category is expensive to change later, because the premises class, the visa quota and any external approval all move with it. DET also issues an e-Trader licence for individuals selling online from home, which is a different product from all four and is covered in licensing an online business. The full comparison, including what each category does to ownership, capital and anti-money-laundering exposure, is in commercial, professional or industrial.

one licence, one category — a business that both consults and trades is looking at two

• Trading, distribution and retailThe category most Dubai mainland files land in
• Most services, not only goodsMost services being commercial rather than professional is the one founders get wrong

Commercial

• Consultancy, engineering, design, medical and legal practiceWhere a sole establishment owned by a non-GCC national still needs a local service agent

Professional

• Manufacturing, production, packaging, sorting and collectionExpensive to change later, because the premises class moves with the category

Industrial

• Hotels, holiday homes, timeshare, travel and tour companiesOne of the six federal licence types, alongside agricultural and crafts

Tourism

• An individual selling online from homeA different product from all four, issued to a person rather than to a company

e-Trader

Choosing the legal form

Two choices in this table cost people real money.

Sole establishment versus LLC. The sole establishment is cheaper and simpler, and it puts your personal assets behind every obligation the business incurs — a client claim, a supplier dispute, an employee award, an unpaid lease balance. A single-partner LLC gives you the same one-owner control with the liability firewall intact. The saving is a few thousand dirhams a year; the exposure is unbounded. For anything carrying contracts, staff, stock or professional risk, this is not a close call.

Representative office versus branch. A representative office may promote, research and liaise. It may not sign a contract, issue an invoice or take revenue. Founders pick it for the low cost, then find in month four that the deal they landed cannot be billed from it. If revenue is anywhere in the plan, licence a branch.

The joint stock forms are real, and rarely the right first form. The Commercial Companies Law lists five forms — the two partnership companies, the LLC, and the private and public joint stock companies — and the Ministry of Economy and Tourism confirms that investors of any nationality may own all five, subject to the strategic-impact list above. The sole establishment and the civil company in the table sit outside that list. A joint stock company exists to spread capital across many holders, and it brings a board of directors and general assembly formalities with it — in the public form, the federal capital markets regulator and its disclosure rules as well. For an owner-managed business, an LLC of one to fifty partners does the same job with far less governance. Choosing the legal form of your UAE company sets out when the heavier forms earn their cost.

A subsidiary is not a separate form. The word describes ownership rather than structure: a UAE subsidiary is ordinarily an LLC whose partner is a company. Unlike a branch, it is its own legal person, so in the ordinary course the parent's exposure stops at its capital contribution — at the price of the parent's attested constitutional documents and a beneficial ownership trail traced through to natural persons.

Share capital: what the law asks for, and what the file asks for

Federal Decree-Law No. 32 of 2021 sets no minimum share capital for an LLC — only that capital be sufficient to achieve the company's stated purpose. There is no obligation to deposit the declared amount in a UAE bank and no capital verification certificate at licensing.

DET still expects a figure in the memorandum, and AED 100,000 to AED 300,000 is what appears most often on Dubai LLC documents. The declared capital is visible to counterparties and to banks assessing an account application, and some regulators impose their own capital floors whatever the companies law says. Set it deliberately rather than copying the template.

The formation sequence, and what each step gates

The order is not a preference. Each step feeds the next, and the most expensive mistake is committing to premises or a structure before the approvals governing them are known. Read as dependencies rather than as a checklist, a Dubai mainland file is rarely refused — it is returned, and the return usually comes from a step you had already paid for and thought was finished.

1. Fix the activity codes against the DET record. Licence category, ownership position, external approvals, premises class and cost all descend from this one decision.
2. Choose the legal form, once you know whether an agent or a regulator's approval is in play.
3. Reserve the trade name. Reservations are time-limited. Names implying regulated activity, governmental association or religious reference are refused, as are names conflicting with existing marks.
4. Initial approval from DET — no objection in principle to a foreign investor conducting the activity. This is the step that surfaces the external approvals, which is why it precedes any spending on premises.
5. External approvals, where the activity requires them. The approving body sets the timetable, not DET.
6. Notarise the memorandum of association before a Dubai notary or another authorised official: shareholding, management, signing authority, profit distribution. Any local service agent agreement is notarised in the same sitting. Corporate shareholders need attested constitutional documents from the home jurisdiction.
7. Secure premises and record the tenancy on Ejari, the Dubai Land Department's tenancy system. Attestation is what makes the address usable in the licence file.
8. Licence issue, against a complete file.
9. Establishment card and immigration file, then entry permit, medical, Emirates ID and residence stamping per person.
10. Corporate bank account — weeks rather than days, and the stage that decides whether the licence was worth buying. Our banking advisory page covers why applications fail.

Realistic timing: two to four weeks from complete file to licence with no external approval. Add four to twelve weeks where a health, education, transport or civil defence clearance sits in the path, plus two to six weeks for visas and banking. Attestation of foreign corporate documents routinely adds three weeks on its own — see document attestation.

StepHow longWho holds it

1. 1Fix the activity codes against the DET record, then the legal formLicence category, ownership position, approvals, premises class and cost all descend from this one decisionDET
2. 2Reserve the trade name, then take initial approvalInitial approval is the step that surfaces the external approvals, which is why it precedes any spending on premisesDET
3. 3External approvals, where the activity requires themA health, education, transport or civil defence clearance — the body sets the timetable, not DET4 to 12 weeksThe approving bodyChanges hands
4. 4Notarise the memorandum of associationAttestation of foreign corporate documents routinely adds three weeks on its own3 weeks for attestationA Dubai notaryChanges hands
5. 5Secure premises and record the tenancy on EjariAttestation is what makes the address usable in the licence fileDubai Land DepartmentChanges hands
6. 6Licence issue, against a complete fileTwo to four weeks from complete file to licence where no external approval sits in the path2 to 4 weeksDETChanges hands
7. 7Establishment card, immigration file, then each person's visaEntry permit, medical, Emirates ID and residence stamping per person2 to 6 weeksMOHRE and the GDRFAChanges hands
8. 8Corporate bank accountThe stage that decides whether the licence was worth buyingweeks rather than daysYour bankChanges hands

The exception worth knowing: DET's Instant Licence issues in minutes through Invest in Dubai for a defined list of activities needing no external approval, and defers both the Ejari-attested tenancy and the notarised memorandum for twelve months. It is a real accelerator for a straightforward consultancy or trading activity, not an exemption — the premises requirement arrives at first renewal, and the visa quota stays minimal until it is met.

The personal documents are where files stall, because a different desk asks for each one

The sequence above names the company documents. The personal ones cause more returned files, because each is requested by a different desk and each has to match the others letter for letter — a middle name on the passport and missing from the Emirates ID is enough to send a file back. Which desk has your file also decides what you can do about it, because a return is yours to fix and a hold is not yours to chase.

If you already work in the UAE, settle the employer question first. Holding shares while resident on an employer's visa is common and lawful. Being named manager, or moving your own residence onto the new company, is where a no-objection letter from your current sponsor tends to be requested — and your employment contract may restrict outside business whatever the authority asks. Requirements differ by authority and by visa category, so confirm yours against the specific service before your name is printed on anything. The full document set by shareholder type is on business setup services in Dubai.

The documents that bind the company are handled in Arabic. Business in Dubai is conducted in English, and nobody needs Arabic to run a company here. The legal file is different. The Dubai Courts notary service for an LLC memorandum requires every supporting document issued abroad to be certified by the Ministry of Foreign Affairs and accompanied by a certified legal translation, and a foreign-language document to carry the certification of the Ministry of Foreign Affairs or the Ministry of Justice. That is the practical content of the language barrier most guides file under culture. Buy the translation on accuracy rather than price: an error in a certified translation is an error in the file the notary relied on, and correcting it later is an amendment rather than a correction. Which text governs your memorandum and contracts is set out in the Arabic text is the one that governs, and our legal translation desk handles the certified work.

Premises, Ejari and the visa arithmetic

A mainland licence is tied to a real, leased, Ejari-attested address, and that address does more work than founders anticipate.

Your headcount ceiling is a function of floor area. MOHRE and the GDRFA assess the quota from the area recorded on your Ejari, applying a working rule of roughly nine square metres per visa. It is administrative practice rather than a published tariff, and it is reassessed whenever the tenancy changes.

The premises must suit the activity, not merely exist. A food business needs an approved kitchen layout and municipality food-safety clearance; a clinic needs a fit-out signed off by the health authority; a warehouse needs civil defence clearance for the class of goods stored. A fit-out that fails inspection stops the licence while the lease is already running.

Count year-two headcount before you sign. Taking space that supports four visas when you intend to employ ten is the most expensive routine mainland error, because upgrading means a new tenancy, a new Ejari, a fresh quota assessment and often a break cost on the lease you are leaving.

External approvals: where DET is not the decision-maker

For a large share of activities DET issues the licence but does not make the decision. These bodies do, each with its own fee, file and timetable.

If your activity appears here, the external body owns your timeline. A consultant quoting a fixed two-week turnaround on a regulated activity is quoting the part of the process they control and staying quiet about the part they do not.

one licence, conditions held by several different bodies

Department of Economy and Tourism

• Initial approval in principle for a foreign investorThe step that surfaces the external approvals, before any spending on premises
• The licence itself, and which category it is issued inThe activity code decides it before you have chosen anything
• A branch licence, or a permit for up to six months, over a free zone licenceExecutive Council Resolution No. 11 of 2025 — every Dubai zone except the DIFC

The sector regulator

• The percentage a foreign investor may hold on a strategic-impact activityCase by case, on an application routed through the emirate's economic department

Dubai Municipality

• An approved kitchen layout, and food-safety clearanceA fit-out that fails inspection stops the licence while the lease is already running

The health authority

• The fit-out sign-off a clinic cannot open withoutIts own fee, its own file and its own timetable

Civil defence

• Clearance for the class of goods a warehouse storesFour to twelve weeks where it sits in the path

MOHRE and the GDRFA

• The visa ceiling, read off the floor area on your EjariRoughly nine square metres per visa, reassessed whenever the tenancy changes

What it costs

Every figure below is indicative. Authority fees are revised without public notice, several components scale with your rent, and external approvals vary by an order of magnitude between activities. Insist on government fees itemised separately from professional fees on any quotation, including ours.

In indicative dirhams that is 600 to 1,000 for the trade name, 200 to 500 for initial approval, 1,500 to 3,000 to notarise the memorandum, 8,000 to 15,000 for the DET licence itself, 500 to 2,000 for Dubai Chamber membership, 1,500 to 2,500 for the establishment card, and 5,000 to 10,000 a year for a local service agent where one is needed. Four lines carry no band at all, and two of them decide the total: the market fee is a percentage of your annual rent, Ejari attestation runs to about AED 220 per tenancy per year, external approvals are highly variable and can exceed every other line combined, and office rent is the real variable, setting both the cost and the visa quota.

Cost lineindicative dirhams, year oneWhat moves it

1. Trade name reservation600 – 1000Reservations are time-limited and lapse
2. Initial approval from DET200 – 500The step that surfaces your external approvals
3. Notarising the memorandum1500 – 3000Any local service agent agreement is signed in the same sitting
4. The DET licence itself8000 – 15000The activity code sets the category behind the figure
5. Dubai Chamber membership500 – 2000Payable alongside the licence
6. Establishment card1500 – 2500Renewed every year with the immigration file
7. Local service agent, a year5000 – 10000A privately negotiated contract, not a government tariff

07.5k15kindicative dirhams, year one

A straightforward Dubai commercial LLC with a modest office typically lands between AED 25,000 and AED 40,000 in year one including a small premises cost, before visas. A regulated activity with a fit-out requirement is a different exercise entirely.

One honest caveat on the market fee. Dubai levies a municipality market fee as a percentage of the annual rent on your Ejari, collected through the licence. It has long stood at 5% for commercial premises, with a substantially higher rate on warehousing, and a 50% reduction to 2.5% has been applied in Dubai. Published sources, including reputable ones, currently disagree about which rate applies to which category. Ask for the figure on your own quotation in writing rather than trusting a percentage from any website, this one included.

Government contracting: the advantage that is real, and the half that is not

This is the mainland benefit that survives every other argument, and it is routinely oversold.

What is real. Dubai government entities procure under Law No. 12 of 2020 through a central supplier record and the emirate's e-procurement platform. Enrolment requires a Dubai trade licence, and for limited tenders invitations go only to suppliers already listed. A free zone licence will not get you there in the ordinary course.

Also real. For federal and semi-government buyers, and the large national operators, the National In-Country Value programme run by the Ministry of Industry and Advanced Technology is the scoring mechanism. An ICV certificate is issued by an approved certifying body, valid twelve months, renewed annually. The formula rewards spend landing inside the UAE economy — local suppliers, UAE-based staff, domestic assets — and a mainland footprint scores where a purely offshore one does not. Confirm the current formula in MoIAT's supplier certification guidelines, which are reissued periodically.

What is oversold. A place on the supplier record is admission to the room, not a share of the work. Buyers weight track record, financial capacity, prequalification and ICV score, and a company incorporated last quarter with no delivery history and no audited accounts is not competitive however its licence reads. If public contracting is the whole basis of your mainland decision, budget two to three years of private-sector delivery and a clean audit trail first — see audit and accounting.

What you owe every year the licence stays open

• Licence renewal, which will not process without a valid tenancy attested on Ejari. The tenancy gates the licence, so your lease renewal date is effectively your licence deadline.
• Establishment card renewal and maintenance of the immigration file.
• Corporate tax. Enrol with the FTA regardless of profit. 9% applies above AED 375,000 of taxable income, and companies under AED 3 million of revenue can elect Small Business Relief, extended to tax periods ending on or before 31 December 2029. A mainland company has no Qualifying Free Zone Person test to pass and no audited-financials condition attached to its tax status — markedly simpler than the free zone position. See UAE corporate tax.
• VAT, where taxable supplies exceed AED 375,000. Mainland premises get no designated-zone treatment on goods.
• Payroll through the Wage Protection System and a compliant MOHRE labour file per employee.
• End-of-service gratuity, building on every full-time foreign employee from the first day. As MOHRE states it, gratuity is 21 days of the last basic wage for each of the first five years of service and 30 days for each year after that, owed once the employee has completed a year of continuous service and capped at two years' wage. It is a cash liability that falls due with the final settlement whether or not you have provided for it, and the labour file has teeth of its own: an establishment whose violations have suspended its operations cannot obtain a new work permit. The arithmetic, and how the split between basic wage and allowances moves it, is on our human resources page.
• Ultimate beneficial owner records, kept current.
• Bookkeeping an auditor can work from — cheap to maintain, expensive to reconstruct.

Our PRO services desk runs these as a standing calendar rather than an annual scramble.

Emiratisation: the mainland cost that appears on no comparison table

Mainland employers record staff with MOHRE, and MOHRE targets follow. Private sector companies with 50 or more employees must raise Emirati participation in skilled roles by 2% a year, checked at 30 June and again at year end, on a trajectory to 10%. Companies with 20 to 49 employees in designated sectors carry a separate, smaller obligation introduced by Cabinet Decision No. 21 of 2023. Shortfalls are charged monthly per unfilled position — for the 2026 compliance year, quoted at AED 9,000 a month, or AED 108,000 a year for one missing role.

Free zone companies employ under their own zone's regime and sit outside these targets. For a business expecting to pass fifty employees this is arguably the largest recurring financial difference between the two jurisdictions, and we have never seen it on a comparison table. Model it before concluding the mainland premium is just a licence fee. Our human resources team plans hiring against the checkpoints rather than against the penalty.

employees recorded on your MOHRE file

Each skilled role left unfilledAED 9,000 a monthAED 108,000 a year for one missing role, in the 2026 compliance year

50 or more employees2% a year in skilled rolesChecked at 30 June and again at year end, on a trajectory to 10%

20 to 49 employees, in designated sectorsa separate, smaller obligationIntroduced by Cabinet Decision No. 21 of 2023

2020 employees, where the obligation begins

Fewer than twenty employeesno target at allThe targets do not reach you, and a free zone company sits outside them at any size

Where mainland is the wrong choice

We would rather lose the file than place you here incorrectly.

1. Your customers are outside the UAE. If you invoice London, Riyadh, Mumbai or Singapore and never issue a domestic invoice, you are paying for access you do not consume — premises, market fee on rent, Emiratisation exposure at scale, a higher renewal every year. A free zone company does the same job for less.

2. You are testing an idea and need a cheap exit. Mainland closure is the heavier one: licence cancellation, immigration file closure, MOHRE clearances, a notarised liquidation resolution, a liquidator's report, newspaper notice and a statutory objection period — alongside a lease you may be locked into. Deciding after nine months that this was not the business costs more here. See company liquidation.

3. Dubai's own 2025 resolution already covers your use case. If mainland access was the sole driver, Executive Council Resolution No. 11 of 2025 may deliver it through a branch licence or activity permit sitting on top of a free zone licence you already hold, at a fraction of a full mainland structure. It depends on whether your activity appears on DET's list — which is a question to ask before a mainland file is opened, not after.

4. You need designated-zone VAT treatment on goods. Mainland premises are inside the UAE for VAT in every respect. If your model is import, store and re-export, the goods belong in a designated zone such as JAFZA, and a mainland entity, if you need one at all, sits alongside it rather than instead of it.

5. You are a regulated financial services firm. DET does not licence banking, asset management, brokerage or advisory in regulated instruments. That is DIFC or ADGM territory under their own regulators, and no mainland licence substitutes for their authorisation.

6. Your activity sits on the strategic-impact list and you will not accept a regulator's ownership condition. Better established in week one than after a trade name is reserved and a lease signed.

One caution on process rather than substance: a mainland licence has more moving parts than a free zone package, which makes it easier to quote incompletely. If a proposal does not separately identify the external approvals your activity triggers, it is a quotation for a generic business, not yours. That is also what is genuinely harder about a mainland company — one licence carries conditions held by several different bodies, and only some of them belong to the economic department.

Mainland or free zone: the arithmetic that decides it

Across those rows the mainland gives direct domestic sale, premises leased and attested on Ejari, a visa ceiling set by floor area at roughly 9 sq m each, corporate tax at 9% above AED 375,000 with Small Business Relief available, Emiratisation targets at 20 and 50 employees, and a heavier closure. The free zone answers with a distributor, a branch or a Dubai activity permit under ECR 11 of 2025, a flexi-desk, a ceiling set by the package tier you buy, 0% only on qualifying income against five conditions and a mandatory audit, no Emiratisation targets, and a lighter exit. On moving profit abroad the two are identical.

the mainland premium, line by line

What you gainWhat you give up

1. Domestic saleYou contract, invoice and deliver anywhere in the UAE with nobody in betweenPremises leased and attested on Ejari, and a market fee levied on that rent
2. Physical presenceRetail units, clinics, workshops, restaurants, showrooms and schoolsThe premises must suit the activity — a failed fit-out stops the licence, the lease runs on
3. HeadcountThe visa ceiling rises with the floor area recorded on your EjariRoughly 9 sq m per visa, reassessed whenever the tenancy changes
4. Corporate taxNo Qualifying Free Zone Person test, no audited-financials condition9% above AED 375,000 of taxable income, with Small Business Relief available
5. OwnershipMore than 1,000 commercial and industrial activities open to full foreign ownershipA professional sole establishment still needs an agent, at AED 5,000 to 10,000 a year
6. Public workEnrolment on Dubai's central supplier record under Law No. 12 of 2020Admission to the room, not a share of the work: buyers weight track record and ICV
7. EmiratisationBelow twenty employees the targets do not reach you at all2% a year in skilled roles past fifty staff, AED 9,000 a month per unfilled role

Read that comparison by revenue source, not by sticker price. If most of your income comes from UAE-based customers, the free zone alternative costs a distributor margin or a second entity, which frequently exceeds the mainland premium. For anyone still undecided, the difference between a free zone and a mainland company narrows to one question about your customer — and the ownership rule most comparisons still lead with was repealed in 2020.

Start from the activity, not from the licence

Almost every expensive mainland error traces back to choosing a jurisdiction before choosing an activity code. The code determines the ownership position, the approvals, the premises class, the visa ceiling and roughly two-thirds of the cost.

Tell us what the business does, who it will invoice, and how many people you expect to employ in year two. We will confirm the codes against the DET record, the ownership position that genuinely applies, the floor area your headcount requires, and a total cost with government fees itemised — including, where it is the honest answer, that you should not be licensing on the mainland at all. Nothing here is advice on your own facts, and no figure should be relied on without checking it against the source cited: fees change without notice, and one of the central rules on this page changed in March 2025.

Business setup in Dubai · Free zone company formation · Compare the free zones · Business activities database · PRO services · Visa services

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