Business Setup in Dubai Mainland, UAE
The economic climate in the United Arab Emirates offers highly favorable circumstances for investors and entrepreneurs. There are many options available to you about business activities, company types, and location, regardless of the kind of business you decide to start.
Additionally, a mainland company gives greater diversity and flexibility, ensuring your business’s long-term success. However, the UAE’s free zones can be better suited for some activities, particularly as a starting point for your operation.
Businesses can operate in the local market thanks to mainland companies, commonly referred to as onshore corporations. There are advantages and requirements to operating a mainland business in the United Arab Emirates.
This guide will give you all the information you need to register a mainland company in Dubai, regardless of whether you’re starting from scratch or intend to relocate from a free zone to the mainland.
What Is a Mainland Company?
The mainland of the United Arab Emirates is essentially a non-free zone. The Department of Economic Development (DED), which is in charge of granting permits on the mainland, regulates this area. These licenses permit businesses to operate without restrictions throughout the nation.
100% foreign ownership is currently permitted in mainland enterprises due to the Commercial Enterprises Law, which was implemented by the UAE government in 2021.
Prior to this move, all mainland businesses owned by foreigners and expats had to have a UAE-national sponsor or a local service agency (LSA) that controlled 51% of the company. This is a significant advantage.
At the moment, this is determined by the type of license your business holds and the types of business you conduct.
For instance, you would probably need a local shareholder to obtain an industrial license, particularly if you intend to accept government contracts. There are many different kinds of activities, nevertheless, that are exempt from this regulation.
Why Switch from the Free Zone to the Mainland?
Since the UAE offers a variety of turnkey for business setup in the Mainland, including offices, licenses, and visas, opening a business in one of its free zones can be quite advantageous. This makes the process of setting up a business simple.
Additionally, several free zones offer notable benefits for specific activity types due to their integration of seaports and airports, field-specific focus, or strategic position.
For instance, Jebel Ali Free Zone (JAFZA) has the nation’s largest port, Jebel Ali Sea Port (Port Jebel Ali). This may be essential for logistics-focused enterprises. Dubai Silicon Oasis caters to technology-based enterprises, and Dubai Airport Free Zone (DAFZA) provides direct access to the Dubai International Airport.
However, this business model is susceptible to restrictions on its general flexibility and territorial coverage when it comes to business operations, capital and shareholder requirements, adding company branches, etc. Therefore, moving to a mainland company is the ideal option if you want to grow your business in the long run.
It is essential to remember that forming a company on the mainland involves several responsibilities, including adhering to specific rules established by the Dubai Department of Economic Development, complying with UAE labor laws, and occasionally requiring a local partner or service agency.
To make sure you understand all the needs, advantages, and responsibilities related to this kind of business structure in Dubai, it is advised that you speak with business consultants, legal professionals, and other relevant government officials prior to forming a mainland company.
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Advantages of Mainland Company Formation in Dubai
For a variety of reasons, starting a mainland business in Dubai might be a desirable choice because it provides several benefits that could help business owners and entrepreneurs:
Access to the Local Market
Dubai’s mainland businesses are free to operate not only in Dubai but also throughout the UAE market without any geographical limitations. As a result, you can reach a wider audience and look into possibilities in other Emirates and overseas.
No Currency Restrictions
Mainland businesses have the freedom to deal in any currency, which promotes flexibility in global financial and economic exchanges.
Diverse Business Activities
Trading, manufacturing, services, and professional practices are just a few of the many business activities that are permitted on the Dubai mainland. This makes mainland businesses appropriate for various sectors and types of activities.
Expansion Opportunities
Operating a mainland business enables company development within the United Arab Emirates. You are free to trade with both domestic and foreign companies and build new branches in other emirates.
Local Government Contracts
Government contracts, which can be profitable and offer steady revenue streams, are open to mainland businesses.
No Minimum Capital Requirement
A minimum amount of money is needed to create a corporation in many free zones. Since there are frequently no such requirements on the mainland of Dubai, entrepreneurs and small enterprises find it easier to get started.
No Limit on the Number of Visas
An infinite number of employment visas are available to Dubai mainland enterprises, which is particularly advantageous for companies with a sizable workforce.
Flexible Office Locations
While a physical office space is required, mainland company formation offers a wide range of locations both inside and outside of Dubai, enabling business owners to take into account elements like accessibility to suppliers, clients, and transit hubs. For customer coverage and logistics, this can be incredibly cost-effective.
No Import/Export Duties within the UAE
One potential cost-saving benefit is that mainland businesses usually do not have to pay import or export taxes when doing business in the United Arab Emirates.
Networking Opportunities
Dubai is a city that welcomes business travelers and has a multicultural population. Without being restricted to any one free zone, you can take advantage of industry events, networking opportunities, and a thriving business ecosystem.
Local Presence
A mainland business can improve its standing with local partners and clients and show a strong commitment to the local market.
Strategic Location
Geographically, Dubai is situated between Asia, Africa, and Europe. Because of this, the city is an ideal location for global trade and business.
Access to Skilled Workforce
Dubai’s ability to draw in a worldwide talent pool makes finding qualified workers for a range of businesses simpler.
Mainland Company Licenses
The mainland of Dubai provides a variety of licenses to support a broad range of business activities. Your business activity and the services you plan to offer will determine the type of license your mainland company needs. The following are some typical mainland business license categories in Dubai:
Commercial License: This license is intended for businesses who acquire and sell items as part of their trade operations. It includes operations related to product distribution, import, and export.
Professional License: Professionals like physicians, attorneys, consultants, engineers, and artists need a professional license to provide their services in Dubai. Usually, this license is granted to people or businesses that offer professional knowledge.
Industrial License: An industrial license is required for companies engaged in manufacturing, processing, or other industrial operations. It includes tasks like manufacturing, assembling, and manufacturing goods.
Tourism License: A tourist license is necessary for businesses in the tourism industry, including travel agencies, tour operators, and hotel establishments.
E-commerce License: Businesses involved in digital, e-commerce, and online retail require an e-commerce license.
Mainland Company Formation Checklist
Navigating the legal and regulatory framework set up by the DED is necessary when establishing a mainland firm in Dubai. This is detailed instruction on how to set up a mainland business in Dubai.
1. Decide on Your Business Activity
First, choose the type of commercial activity that your organization will engage in. This will primarily determine the type of license you need to apply for. In contrast to free zones, where the specific free zone’s regulations typically limit your options, the DED-approved list of commercial activities allowed for mainland companies has thousands of them under various categories.
You can easily re-register the necessary operations with the DED if you wish to broaden your current company.
2. Choose the company's Legal structure
Businesses on the mainland can choose from a variety of legal structure types. Typical examples include sole proprietorships, public or private shareholding companies, and limited liability companies (LLCs).
A collection of documents for company formation and specific regulatory requirements apply to each legal entity. An LLC is the most common legal form that needs two or more stockholders.
3. Select a Company Name
Select a unique and suitable name for your business when you register it. Make sure that the naming conventions of the DED are followed. Before choosing a company name, it is best to seek advice from subject-matter experts because the UAE has some general company naming regulations. Prepare a few name ideas ahead of time to be safe.
4. Prepare the Required Documents
Prepare the paperwork required for business registration. The most typical ones are entry stamps, passport-size pictures, and copies of the shareholders’ passports, though the list may change based on the business’s legal structure. To minimize possible issues with the authorities, it is better to obtain legal and consulting guidance on this subject.
The Local Service Agent Agreement and/or the Memorandum of Association (MOA) are examples of legal documents. The latter is necessary if the operations and legal structure of the company require that a local partner or service agency be a shareholder, as in the case of an LLC operating an industrial or manpower supply business.
The sponsor may be a local business or a citizen of the United Arab Emirates that owns 51% of your company.
Remember that some businesses offer LSAs and corporate nominee services. While you keep real ownership of the company, they act as a local sponsor or partner and assist you with administrative matters.
5. Choose the Perfect Location and Office Space
Proof of office space in Dubai will be required. This office space needs to be appropriate for your business operations and comply with DED regulations. In contrast to free zone businesses, mainland businesses can choose any location based on their needs.
If your trading business is centered on importing and exporting commodities. In that case, you can have an office in a city business area and rent a warehouse close to Dubai’s transportation hubs, such as seaports and airports.
You can select an office arrangement based on your budget and needs. While some choose turnkey options, including everything the property owner needs, such as phones, internet access, and furniture; others prefer to fully outfit their offices or opt for something in between. Keep in mind that the rent costs associated with each option vary.
6. Apply for Company Registration in Dubai Mainland and License
Depending on your business activity, submit your application to the DED or the appropriate body for company formation and license type. Depending on the nature of your company, you might additionally require extra permits from government agencies or regulatory authorities.
7. Pay Fees and Secure Your License and Approvals
You will obtain your mainland license and any other permissions or approvals needed for your particular business activity and company type after your application is accepted and the applicable costs are paid.
8. Register for Taxation
For taxation purposes, register your business with the Federal Tax Authority (FTA). For example, the UAE government imposed a 9% corporation tax on some companies and entrepreneurs in 2023, so be sure to fulfill all tax requirements. Consult a professional if required.
9. Open a Corporate Bank Account
Open a business bank account in Dubai with a neighborhood bank. You must fulfill the bank’s requirements and present the necessary paperwork.
10. Apply for Visa and Labor Approvals
You must get labor approvals and employment visas from the Ministry of Human Resources and Emiratization if you intend to hire staff. The sole limitation on the number of staff visas that mainland businesses are subject to is the size of their office space. Typically, there is one visa for every 100 square feet (9 square meters).
Residency visas, often known as investor or partner visas, are available to foreign owners of businesses located on the mainland of Dubai. The validity of these visas ranges from one to three years.
As long as you continue to own the business and fulfill the requirements for renewing your visa, they can be extended. In terms of visas, this also enables you to sponsor your family members and other potential dependents.
11. Seek Legal Counsel
Consult a local business consultant or law firm that specializes in company formation in Dubai for legal help. They can help you handle any legal issues and lead you through the procedure.
Remember that the rules and procedures for forming a company in Dubai might change over time, so it’s crucial to speak with local officials or business advisors to be sure you get the most recent information and advice for your particular business activity.
Conclusion
Whether you are starting a business or moving from a free zone, opening a company on the mainland of Dubai can be a crucial step to success. Mainland businesses present a wealth of chances for growth and economical business methods, particularly if you come prepared and knowledgeable.
At JSB Incorporation, we are well-versed in all aspects of forming a company in Dubai and the United Arab Emirates. Our team of experts in the field would be happy to help you with any associated problem and support you.
Book your free consultation call today with our Business Setup Consultants in Dubai.
FAQs
No, recent laws allow 100% foreign ownership in most business activities, eliminating the need for a local sponsor.
There is no specific minimum capital requirement for most business activities in Dubai, Mainland.
The process typically takes 7 to 10 working days, depending on the approvals required.
Dubai Mainland offers commercial, professional, and industrial licenses based on the nature of your business.
Yes, a Mainland company allows you to trade anywhere in the UAE and internationally.
Don't miss out on this limited-time opportunity!
We'd Love To Hear From You
contact us
Find us Here
Office No 20, 4th Floor, Al Moosa Tower 2,
Sheikh Zayed Road Dubai, United Arab Emirates P.O. Box 27614.
Get In touch
+971 4 824 4842
info@jsbincorporation.com