One of the most important decisions you'll need to make if you're an entrepreneur planning to set up your company in Dubai is where your company's location should be. Should you opt for a free zone or mainland company formation in Dubai? You have to make the right decision at this juncture – one that allows your business adequate freedom and flexibility while ensuring your company's future success.
Despite the much-vaunted ease of setting up an FZE company, many entrepreneurs prefer to set up their mainland Dubai company. Wondering why? There are certain advantages that Dubai Mainland companies have over their free zone counterparts. Let's examine these in detail.
Free zone vs. Mainland company in Dubai
A mainland company in Dubai is one that holds a valid company license issued by the Department of Economic Development (DED) in Dubai. In contrast, a free zone company is licensed by one of the free zone authorities and covers only a particular geographical area. The main advantages that a mainland company has over a free zone company in Dubai are
Can trade across the UAE and internationally
- Dubai mainland companies can trade or provide services with whomever and wherever across the UAE with no restrictions.
- Mainland companies that are set up in Dubai can engage in any trade without being concerned about trade permissions from the local authority.
- Mainland Dubai companies can engage in local trading and delivering services in the UAE.
- Free trade policies in the UAE allow you to trade globally, meaning you can do business within the UAE and outside.
Have location flexibility
- A mainland company can be located anywhere in the mainland of Dubai, unlike free zone companies.
- A mainland company in Dubai can be set up even without a physical space at the outset if your business's nature does not require it.
Can expand your business within the UAE and internationally
- Dubai mainland companies have the freedom to expand their business (i.e., open branches, increase workforce) to other parts of Dubai and other Emirates.
- Companies with a Dubai mainland license can trade internationally and expand their presence globally.
Can easily diversify your business operations
- Diversification is easier, whether new products, services, or sectors, for a mainland company setup rather than a free zone company.
- A Dubai mainland company can scale up, evolve, and diversify quicker than free zone companies.
Ability to engage with UAE or GCC governments
- Dubai mainland companies are allowed to carry out business with government & quasi-government bodies in the UAE or the GCC.
- This means your company can bid for government tenders and contracts in verticals such as construction, realty, transport, and tourism worth billions of dollars each year.
- Winning official UAE government contracts will help you improve your company's credibility, reputation, and visibility both in Dubai and worldwide.
Have access to an unlimited number of visas
- This is vital if you're planning to expand. Unlike FZE companies, Dubai mainland companies are allowed to apply for unlimited visas based on the requirement of the company.
- Typically, the more visas you apply for, the more office/warehouse space you need to rent. However, suppose your mainland company employs lots of workers remotely who do not require workspace. In that case, you can negotiate with the MOHRE about the need to rent extra office space.
Can engage in more business activities
- Mainland companies in Dubai can offer a much more comprehensive range of permissible business activities than FZE companies that are often limited by that particular zone category.
100% Ownership Control
- Probably the most significant advantage FZEs had was that they did not need local UAE sponsors. However, a recent decree allowing 100% foreign investment has all but mitigated the need for this.
Dubai mainland company formation costs are lower
- Mainland company formation in Dubai is cheaper since there aren't any overhead application costs or double taxation.
How to set up a mainland company in DubaiThere are several steps involved in setting up a mainland company in Dubai. You need to
- Reserve a trading name for your company while making sure it doesn't violate any naming conventions.
- Decide the business location and get the initial approval certificate from DED.
- Complete all the necessary documentation and partner with a reliable local sponsor if required.
- Obtain your business trading license
- Apply to the labor registry to acquire labor cards and the required visas.
Why Avyanco for mainland company setup in Dubai?
Company formation in Dubai needs you to have a deep understanding of the documentation and processes involved. Our UAE mainland business set up experts can help you with all aspects of company formation in Dubai. Business setup in Dubai can be totally hassle-free with the right business setup partner. With Avyanco's wide-ranging business setup services, you won't have even an iota of worry regarding the mainland company setup process in Dubai. Reach out to us, and we'll make your business set up in any part of the UAE smooth and efficient. With Avyanco as your company setup partner, registering a Dubai company can be easy, and the entire process can be done in less than 10 days. You call us at +971 503989000 or write to us at email@example.com, and our team of qualified professionals will reach out to you in no time.