Mainland, Free Zone or Offshore Company?

Mainland

• Licensed by the economic department of the emirate, for example the Department of Economy and Tourism in Dubai.
• Can trade with customers and government bodies anywhere in the UAE.
• Foreign ownership up to 100% for most activities; activities of strategic impact, such as defence, telecommunications and banking, keep restrictions.

Source: UAE Government Portal: Full foreign ownership of commercial companies¹

Free zone

• Licensed by the free zone authority, which also issues visas and leases the office.
• No restrictions on foreign trade, as long as goods do not enter the mainland without customs clearance.
• To sell on the mainland: a licensed mainland distributor, a mainland branch or company, or the licences the emirate requires.
• Qualifying income can be taxed at 0% if the company meets the Qualifying Free Zone Person conditions.

Source: UAE Government Portal: Running a business in a free zone; Federal Tax Authority: Free Zone Person bulletin^2,5

In Dubai, Executive Council Resolution No. 11 of 2025 lets free zone companies operate in the mainland with a permit from the Department of Economy and Tourism. The Free Zone Mainland Operating Permit, launched in October 2025, costs AED 5,000 for six months, first covers non-regulated activities such as technology, consultancy, design, professional services and trading, and requires separate accounts; the related revenue is taxed at 9%.^3,2

Offshore

Registries such as the RAK International Corporate Centre set up international companies for holding assets, succession planning and structuring. They can open bank accounts but are not the vehicle for running a business with staff and customers in the UAE; ask the registry what the company may do before you choose it.⁴