Dubai Mainland vs Freezone
To start up a company
Mainland Business: means a company incorporated and licensed by Department of Economic Development (DED) respective emirate, allowed to do business in the local market as well as international market without any restrictions.
Freezone Business: means company incorporated and licensed by designated Jurisdiction of respective emirate, allowed to do business inside freezone and outside UAE. The companies having commercial license and trading of physical goods cannot do business within local limited of UAE and if they wish to do than they have to pay 5 % duty on local market invoices.
Major comparisons between Mainland & Freezone Businesses are follows:
1.
Scope
of Business: Mainland companies can do business
freely in local markets without any restrictions from the government whereas
Freezone companies can do business inside respective freezone and outside UAE.
Restrictions are only applied to the Commercial Licenses only not the
Professional Licenses.
2.
Ownership: UAE national is mandatory to hold 51% in Local Business. In
Mainland company expat can only hold 49% of share capital whereas, in Freezone
company expat can own 100% ownership.
3.
Office
Space: In Mainland company there is
requirement to lease minimum of 200 Sq Ft whereas there is no minimum
requirement as such in Freezone company.
4.
Visa
Facility: Mainland Company doesn’t have
limitation of Visa facility where as Freezone offer 2 visas on a smart office
package.
5.
Approvals
from Government: In Mainland company approval from
government is depended upon Business Activity for example food department for
food related activity and Freezone companies are preferred for import and
export License and usually they doesn't require external approval.
6. Time Frame to Setup Business: For
Mainland, the time frame for its setup depends on finding the right local
partner as sponsor and for Freezone companies it depends upon choosing the
right freezone for business operation. Usually it takes 3 to 6 weeks for both
setups.
These were some of the major differences between the two forms. If you require more information feel free to contact us. We are experienced professionals looking forward to guide you for setting up your business.
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ReplyDeleteGreat article. Thanks for sharing the blog it's really informative and helpful for those who are looking to setup the business in Dubai and want the processional assistance for business setup.
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This is a very informative blog post on the key differences between mainland and free zone companies in Dubai. I especially appreciate the table that summarizes the key points, making it easy to compare the two types of companies side-by-side.
ReplyDeleteI would like to add that the choice of whether to set up a mainland or free zone company in Dubai depends on a number of factors, including the nature of the business, the target market, and the budget.
For example, businesses that need to trade with local companies or sell goods and services to the UAE government are better off setting up a mainland company. Free zone companies, on the other hand, are a good option for businesses that want to operate in a tax-free environment or that need to have 100% foreign ownership.
I would also recommend that businesses consult with a qualified professional to get advice on the best type of company to set up in Dubai, based on their specific needs and circumstances.
Overall, this is a very well-written and informative blog post. Thank you for sharing your insights!
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