Menu
Set up your mainland
company in Dubai
Mainland Company Formation in Dubai
Is setting up a mainland company in Dubai the right move for you?
Select from more than 3,000 business activities and benefit from the flexibility to operate across the UAE and internationally.
Mainland Company Formation in Dubai
What is a UAE mainland company, and why is it essential to have one?
A mainland company is a business entity licensed by the Department of Economic Development (DED) in the respective Emirate of the UAE. Below is a summary of the advantages of registering a company on the UAE mainland, along with a guide to setting up a business on the Dubai mainland!
Benefits of Mainland Company formation
Switching from Free Zone to Mainland Company Formation:
- Choose your business activity
- Find your ideal location
- Determine your business legal structure
- Obtain a local sponsor or local service agent
- Name your company
- Apply for a mainland trade licence
- Secure your office space
- Apply for relevant visas
- Partner with a Company Setup Consultant
Benefits of mainland company formation in Dubai
Location Flexibility and No Trade Restrictions
With a Dubai mainland company, you have the freedom to trade with other businesses and access a wide range of location options. These companies can also provide services to the government and sell directly to consumers anywhere in the UAE. Additionally, establishing a mainland company allows you to open multiple branches, strengthening your presence across the Emirates.
Broad Scope of Operations
Mainland businesses have the flexibility to engage in a variety of activities. If you wish to diversify your services within the mainland, you can easily register the new business activity with the DED and begin trading without restrictions.
Access to High-Value Government Contracts
One of the significant advantages of setting up a mainland business in Dubai is the opportunity to bid for lucrative government contracts in the UAE. In recent years, the Abu Dhabi Executive Council approved AED 17.5 billion (USD 4.76 billion) for government projects, including over AED 4 billion for infrastructure. Around AED 2 billion was allocated to education, and a combined AED 1.2 billion was earmarked for upgrades to government and social facilities. As an established mainland company in Dubai, you’ll be well-positioned to benefit from these opportunities.
100% Ownership of Mainland Business Entities
Traditionally, 100% foreign ownership of a UAE business was only possible in two scenarios:
- When setting up in a free zone
- When establishing a professional services company in the mainland (Sole Establishment or Civil Company)
In recent years, HH Sheikh Mohammed bin Rashid Al Maktoum introduced changes allowing 100% foreign ownership of mainland companies in the UAE. This development has been particularly beneficial for international investors interested in doing business in the Emirates. With 100% foreign ownership, business owners can focus on their operations without needing to find an Emirati partner. This offers incredible potential for foreign investors in the UAE’s rapidly growing economy. However, certain strategic sectors, such as oil and gas, still require a local partner.
Switching from Free Zone to Mainland Company Formation in Dubai
If you’re currently operating within a free zone business structure and considering a transition to a mainland company, we’re here to help.
Over 30,000 companies operate in the three largest UAE free zones, offering foreign entrepreneurs the benefits of pre-packaged business solutions. However, while free zone companies are an excellent starting point, they come with certain limitations. To grow and expand, many businesses find it necessary to transition to a mainland company. This move is crucial for the continued growth of your business. With the support of the right UAE national sponsor or a company formation specialist, transitioning from a free zone to the mainland is both a strategic and achievable step.
Your Checklist for Mainland Business Setup in Dubai
It’s time to prepare your business setup checklist. Let’s ensure your venture starts off on the right foot!
1. Choose your business activity
The first step in setting up a company in the UAE mainland is choosing the industry in which you will operate.
The Department of Economic Development (DED) lists thousands of permitted business activities, including trading, agriculture, hospitality, and manufacturing. Unlike many free zone businesses that face restrictions based on their location, mainland businesses have the freedom to engage in any of the 2,000+ activities listed by the DED.
2. Find the ideal location for your business in the UAE
Once you’ve chosen your business activity, the next step is to decide where you want to operate.
Businesses on the UAE mainland face no restrictions on their location. The ideal location will depend on factors like your budget and the nature of your business activity. If your company relies on imports and exports, setting up near one of the UAE’s major ports—such as Jebel Ali, Mina Zayed, or Mina Khalid—can be highly beneficial. Another advantage of setting up a mainland business in Dubai is the ease of opening branch offices, allowing businesses to expand their local presence across multiple locations over time.
3. Determine your business legal structure
From a legal standpoint, foreign entrepreneurs can establish several types of businesses on the UAE mainland.
The most common structure is a Limited Liability Company (LLC), an independent legal entity owned by two or more shareholders. Any business planning to operate under a commercial or industrial license, including those involved in industrial and manufacturing activities, must form an LLC to set up on the UAE mainland. This typically requires a local sponsor. In contrast, setting up a professional service company does not require a local sponsor and can be 100% foreign-owned. More details on this coming up next!
4. Obtain a local sponsor or local service agent
In the past, foreign entrepreneurs could only establish a mainland business in Dubai by partnering with a sponsor or local service agent.
For businesses trading under a commercial or industrial license as an LLC, a local sponsor is required. This sponsor can be either a UAE national or a UAE-based company, and in both cases, the local sponsor will hold 51% ownership of the business.
Virtuzone offers a Corporate Nominee to serve as your Local Partner, allowing you to maintain 100% operational and financial control of your business while protecting you from potential risks. When setting up a professional company on the mainland, only a local service agent (LSA) is needed. The LSA does not own any share of the business and serves solely as a representative in administrative dealings and with the government.
5. Name your company
Choosing a company trade name that reflects your brand and professional values is one of the most critical decisions an entrepreneur can make.
In the UAE, there are specific rules to consider. The use of offensive language, religious references, or any inferences to other organizations is strictly prohibited. Additionally, only full personal names can be included in your company trade name. If your company name is in a different language, it must be written as it is pronounced, rather than translated. For a complete overview of the guidelines on naming your company, refer to our Choosing a Company Name in the UAE guide.
6. Apply for a mainland trade licence
Now it’s time to apply for a mainland trade license with the Department of Economic Development.
Several documents are required as part of the trade license application. These include a license application, a memorandum of sponsor arrangements, details of ownership percentages among all partners, and shareholder visas, among others.
7. Secure your office space
Once you’ve obtained your business trading license, the next step is to secure office space.
In the UAE mainland, serviced offices are typically owned and managed by a third party and come fully equipped, allowing you to move in right away. These offices often include desks, phone and internet access, and reception services. Your lease payment generally covers rent, use of office equipment, and utility bills. On the other end of the spectrum is a ‘shell and core’ office space, which requires a full fit-out and decoration, with bills added on top of the rent. There is also a middle option, where office spaces come pre-fitted, and the business owner provides their own equipment and pays bills separately.
8. Apply for relevant visas
There’s no limit to the number of mainland visa applications for business owners in the UAE mainland.
However, the number of visas applied for should align with the amount of office space available. The general rule is 100 sq. ft. of office or warehouse space per visa. There are exceptions to this rule, though. For instance, a domestic cleaning company with 500+ employees working remotely would require much less office space than a textiles or manufacturing company. As the owner of a UAE mainland company, you can also sponsor dependents, such as family members and domestic staff (maids or drivers), for their visas. Additionally, foreign entrepreneurs who establish a business on the UAE mainland are eligible for an investment visa, allowing them and their families to live and work in the UAE for up to three years.
9. Partner with a Company Setup Consultant
Setting up a mainland company in the UAE requires a thorough understanding of the legal and company formation process.
Working with UAE-based business setup consultants can alleviate the stress of setting up a company for overseas entrepreneurs. A business consultant can work closely with you to understand your business goals, ensuring you feel confident in launching a successful business on the Dubai mainland.