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Mainland Company Setup in Dubai

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About Mainland:

What exactly is a UAE mainland company and why is it so important to have one? A mainland company is a company licensed by the Department of Economic Development (DED) in the relevant Emirate of the United Arab Emirates.

Here’s a summary of the benefits of company registration on the UAE mainland, plus a guide to business setup on the Dubai maniland!

Mainland Licence

A Dubai mainland license allows businesses to operate within the mainland areas of Dubai and across the UAE without any restrictions. This type of license is ideal for businesses looking to target the local market or government contracts.

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Mainland Activities

Dubai mainland activities encompass a broad spectrum of business operations, including commercial, professional, industrial, and tourism sectors. Commercial activities cover trading, retail, real estate, and hospitality services.

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Benefits of mainland company formation in Dubai:
There are many benefits to company registration on the mainland. Mainland company setup ensures a prosperous future in your business activities and professional ventures. Mainland companies offer a broad scope of trade, 100% ownership and location flexibility. These are some of the reasons why entrepreneurs look to establish a mainland company in the UAE.

Location flexibility and zero trade restrictions: A Dubai mainland company has no restrictions on trade between other businesses and has no limits on location. Mainland companies can also offer services to the government, or trade directly with consumers from anywhere in the UAE. Mainland company setup also allows businesses to open multiple branches, building a strong presence throughout the Emirates.

Broad working scope: Mainland businesses are also in a position to undertake a wide scope of work. When you’re wanting to diversify your offering within the mainland, simply re-register the new business activity with the DED and you’re ready to trade freely.
Access to lucrative government contracts: Any incentive for mainland business setup in Dubai is that government tenders are big business in the UAE. In recent years, the Abu Dhabi Executive Council approved AED 17.5bn (USD 4.76bn) of spending on government projects, including over AED 4bn on infrastructure. Approximately AED 2bn was allocated for education and a combined AED 1.2bn on upgrades to governmental and social facilities. As an established mainland company in Dubai, you’ll be well positioned to take advantage of such lucrative government contracts.
100% ownership control of mainland business entities: Traditionally, 100% foreign ownership of a UAE business entity was only possible under two circumstances
When setting up in a free zone or
When establishing a professional services company in the mainland (Sole Establishment or Civil Company)
In recent years, HH Sheikh Mohammed bin Rashid Al Maktoum has allowed 100% foreign ownership of mainland companies in the UAE. This has been a welcome change for prospective overseas investors looking to conduct business in the Emirates. This is great news for international investors new to the Emirates. 100% foreign ownership means business owners can get straight down to business, without the need to canvass for an Emirati company or individual to act as a partner. 100% foreign ownership of mainland UAE business provides incredible potential for the UAE’s growth-machine economy to foreign investors. However, certain strategic sectors, such as oil and gas, still require a local partner.

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Switching from free zone to mainland company formation in Dubai:

If you’re currently set up within a free zone business structure and considering the leap to forming a mainland company, we’re here to help. Over 30,000 companies currently trade from the three biggest UAE free zones. Foreign entrepreneurs can set up in a free zone and enjoy the conveniences of pre-packed business inclusions. Yet there are limitations on this model for business owners. While free zone companies form an ideal starting point for UAE businesses, when it’s time to expand, it’s time to make the switch to a mainland company. Switching to a mainland company is crucial for business prosperity. With the right UAE national sponsor or company formation specialist, moving from a free zone to the UAE mainland is a shrewd and manageable move.

Your checklist for mainland business setup in Dubai

It’s time for your business setup checklist. Let’s get your venture off to a successful start!

Choose your business activity

The first thing to decide before you set up a company in the UAE mainland is the industry in which you will trade. There are thousands of permitted business activities as listed by the Department of Economic Development (DED). Some of these include trading, agriculture, hospitality and manufacturing. Unlike many free zone businesses that are restricted from certain activities based on their location, mainland businesses are free to trade in any of the 2000+ DED-listed activities.

Find the ideal location for your business in the UAE

Once you’ve decided your business activity, the next step is to decide where you wish to operate. Businesses on the UAE mainland incur no restrictions on where they can set up. The right location will depend on many factors such as budgeting and your chosen business activity. Should your company rely on imports and exports, then setting up near one of the UAE’s busy ports – Jebel Ali, Mina Zayed or Mina Khalid – makes perfect business sense. Another advantage of mainland business setup in Dubai is the ease of opening branch offices. This means businesses are not limited to one location and can build a large local presence over time.

Obtain a local sponsor or local service agent

Previously, foreign entrepreneurs could only manage mainland business setup in Dubai by partnering with either a sponsor or local service agent. If trading under a commercial or industrial licence as an LLC then a local sponsor is required. Your local sponsor can either be a UAE national or a UAE-based company. In both cases, the local sponsor will own 51% of the business.

Virtuzone can provide you with a Corporate Nominee to act as your Local Partner. This allows you to retain 100% operational and financial control of the business and protects you against any risk. When setting up a professional company in the mainland, only a local service agent (LSA) is required. The LSA will not own any share of the business and will only act as a representative in all administrative dealings and with the government.

Name your company

Deciding on a company trade name that conveys your brand and professional values is one of the most important business decisions an entrepreneur can make. In the UAE, there are several considerations to keep in mind. Offensive language, religious references or inferences to other organisations are all forbidden. Only full personal names can be included in your company trade name. When it comes to your company trade name in different languages, all names must be written as they are sounded out, rather than translated. To know all the guidelines on naming your company, check our Choosing a Company Name in the UAE guide.

Apply for a mainland trade licence

Now it’s time to apply for a mainland trade licence with the Department of Economic Development. Several documents are required as part of a trade license application. These include a licence application; memorandum of sponsor arrangements; and ownership percentage among all partners and shareholder visas, just to name a few.

Secure your office space

Once you’ve obtained a business trading licence, it’s time to secure an office space. In the UAE mainland, serviced offices are usually owned and maintained by a third party and contain everything you need to move in immediately. Desks, phone and internet access and reception services are some usual inclusions. Your lease payment would usually cover rent, use of office equipment and utility bills. The other end of the spectrum is a ‘shell and core’ type of office space. This usually requires a full fit-out and decoration, with bills on top of rent costs. A middle ground exists too, with office spaces pre-fitted, where the business owner simply provides their own equipment and pays bills separately.

Apply for relevant visas

There’s no limit with mainland visa applications for business owners in the UAE mainland. But the number of visas applied for should correspond with the amount of office space required. Usually, 100 sq. ft. of office or warehouse space per visa is the rule. There are circumstances where this may not be applicable. For example, if the business is a domestic cleaning company with 500+ employees working remotely, the office space needs would be decidedly smaller compared to a textiles or manufacturing company. As the owner of a UAE mainland company, you will also be able to sponsor dependents – such as family members and domestic staff (maids or drivers, for example) for their visas as well. Foreign entrepreneurs who establish business on the UAE mainland are also entitled to an investment visa which gives them and their families the right to live and work in the UAE for up to three years.

Partner with a Company Setup Consultant

Setting up a mainland company in the UAE requires a deep understanding of the legal and company formation process. Working with UAE-based business setup consultants helps take the stress out of setting up a company for overseas entrepreneurs. A business consultant can collaborate with you and understand your business goals. This will help you feel confident in starting a successful business on the Duabi mainland.

Process for mainland license