In an effort to facilitate the expansion of free zone businesses within the emirate, Dubai has released a new resolution governing their operations.

Sheikh Hamdan bin Mohammed, the Crown Prince of Dubai, the Deputy Prime Minister, and the Minister of Defense, issued the resolution on Monday while serving as the chairman of the Executive Council of Dubai.

As long as it receives the required licenses or permissions from the Dubai Department of Economy and Tourism (DET), it permits any business or organization licensed by a relevant authority in a free zone to operate inside and outside Dubai. Financial institutions with operating licenses within the Dubai International Financial Center are exempt from the resolution.

On Monday, the Dubai Media Office stated that establishments must keep distinct financial records for their operations carried out outside the free zone—different from those performed within it—and adhere to all applicable federal and local laws related to their operations.

Additionally, the statement stated that enterprises must obtain the necessary licenses and permits from the appropriate authorities if they intend to operate outside of Dubai.

“By allowing free zone companies to easily extend their operations outside of the free zones into mainland Dubai, this most recent resolution represents a significant advancement in improving the business landscape,” it continued.

The resolution states that the DET has the authority to provide a license to a business so that it can open a branch in the emirate or a branch with its headquarters located in the free zone. 

According to the statement, these licenses are renewable and have a one-year expiration date. In the emirate, permits may also be granted for particular activities.

Within six months, the DET must provide a list of economic activities businesses are permitted to carry out in Dubai in coordination with the licensing authorities.

The resolution also specifies the rules for hiring the company’s employees, the steps for issuing activity permits, and the prerequisites for acquiring a license.

The statement also stated that any business granted a license to operate in Dubai under this resolution is subject to inspection.

The project aligns with the city’s ambitious D33 goal, which calls for the emirate to rank among the top three worldwide cities and double its economy to Dh32 trillion ($8.71 trillion) over the next ten years. 

The goal of the strategy is to help 30 private businesses become “unicorns,” or start-ups with a valuation of at least $1 billion. By 2033, the D33 agenda also seeks to establish Dubai as the world’s leading digital economy, the most rapidly expanding and alluring global commercial hub, and a center for sustainability and economic diversification.

Dubai’s economy expanded 3.1% in the first nine months of last year, reaching Dh339.4 billion. This increase was driven mainly by advancements in several industries, including retail and wholesale commerce, transportation and storage, and banking and insurance operations.

Additionally, for the fourth year in a row, Dubai was named the world’s top location for greenfield FDI projects last year.

According to data from The Financial Times’ fDi Markets, the Dubai Media Office this month reported that 1,117 greenfield FDI projects totaling over Dh52.3 billion were drawn to Dubai in 2024—a 33.2% increase from 2023.

Both in terms of project counts and greenfield FDI value, this was the greatest achievement ever recorded by the emirate in a single year since 2020.

Looking Ahead

Although the new rule is a big step in the direction of economic liberalization, its effective implementation will require precise rules and efficient DET permit issuance procedures. 

Companies and regulatory bodies will need to work closely together to guarantee compliance and handle any issues that may arise during this transition.

To sum up, Dubai’s choice to permit free zone businesses to function throughout the emirate is a calculated move to improve its business environment. This regulation move is anticipated to promote economic expansion, draw in foreign capital, and solidify Dubai’s position as a top international corporate destination.