Home – Mainland Business Setup in UAE
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The UAE offers a strategic location, favourable business environment, tax advantages, and world-class infrastructure, making it an attractive destination for starting a business. We provide a comprehensive guide to forming a mainland company and discuss its entailments, benefits, and steps.
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In the UAE, there are two main types of company formations mainland and free zone. A mainland company is registered with the government and can operate anywhere within the country, while a free zone company is restricted to the free zone.
Unlimited Market Access: Mainland companies are not restricted to any geographical location and can conduct business anywhere in the UAE.
No Restrictions on Activity: Mainland companies can engage in almost any business activity, from trading and manufacturing to consultancy and services.
Flexibility in Location: Unlike free zone companies, which are bound to operate within their designated free zone, mainland companies can set up offices anywhere in the UAE.
Foreign Ownership: The UAE government has recently relaxed foreign ownership laws. Depending on the type of business, a foreign investor can now own 100% of the mainland company, especially in previously restricted sectors.
Visa Benefits: Mainland companies can sponsor employees and apply for UAE residence visas, making it easier for business owners and employees to live and work there.
Ability to Bid for Government Contracts: Mainland businesses have access to government projects and contracts, which can be a lucrative avenue for growth.
Strategic Location: The UAE is a gateway between East and West, offering easy access to regional markets across the Middle East, Asia, and Africa. Its major cities, Dubai and Abu Dhabi, are bustling commercial hubs.
Tax Advantages: The UAE offers a highly favorable tax regime. With the introduction of a 9% corporate tax (as of 2023), the UAE remains one of the most tax-friendly locations for businesses. Additionally, the country has no personal income taxes, capital gains taxes, or withholding taxes.
Ease of Doing Business: The UAE is consistently ranked as one of the easiest places to do business globally, thanks to its simplified registration procedures, supportive legal framework, and modern infrastructure.
Access to Talent: Setting up a mainland company enables you to recruit top-tier talent from the UAE and abroad, allowing you to build a skilled workforce.
Reputation and Credibility: A mainland company holds a certain level of prestige, as it is registered directly with the UAE government, which can enhance your company's credibility when dealing with local businesses and governmental entities.
Mehar Business Solution offers a professional service for forming a mainland company in the UAE, offering tax advantages for entrepreneurs and businesses. Professional services simplify this process, ensuring legal compliance and smooth market entry. Whether a foreign investor or local entrepreneur, we assist for business setup in dubai, pro services in dubai and other service provides flexibility and opportunities for success in the UAE market.
While the process for mainland company formation is relatively straightforward, it requires attention to detail and adherence to UAE legal and regulatory requirements. Here are the typical steps involved:
The first step is determining the business activity you wish to pursue. The UAE government categorizes business activities under various licenses, including trading, professional, and industrial. Understanding the appropriate category is critical as it will influence the documents required and the business's legal structure.
The next step is to select a business name for your company. The name should align with the business activity and adhere to UAE naming conventions. Certain words and terms (such as those related to religion or politics) are prohibited.
In the UAE mainland, businesses can operate under various legal structures, including:
A UAE national sponsor or partner may be required for many business types, especially in certain sectors. In an LLC, the local sponsor generally holds 51% of the company's shares, but the foreign investor retains full control over operations and profits through a contractual agreement. However, recent reforms now allow 100% foreign ownership in many sectors, making the need for a local sponsor optional for certain business activities.
The company must be registered with the Department of Economic Development (DED), an Emirate government entity that issues licenses and ensures compliance with local laws and regulations. You'll need to submit various documents, including the business plan, passport copies of shareholders, and a tenancy contract for the business premises.
A mainland company is required to have a physical office in the UAE. You must secure a commercial lease in the emirate where your business is registered. This office will serve as the official business address.
The DED will issue a trade license once your business activity and legal structure are confirmed. Additional approvals may be required for certain industries, including healthcare, education, and media. Once you receive all necessary approvals, your business will be officially registered.
You can apply for employee, investor, and family visas once your company is established. The number of visas you can sponsor depends on the size of your office and the nature of your business.
Home – Frequently Asked Questions
A mainland business in the UAE refers to a company registered with the Department of Economic Development (DED) in the respective emirate and authorized to operate within the local market without limitations. Such businesses can trade directly with the UAE market and operate in any emirate except free zones.
Benefits include full access to the UAE market, the ability to engage in business across various sectors, zero restrictions on the number of employee visas (depending on your office space), and the opportunity to have an office in a prime location.
The minimum share capital required varies depending on the business activity and the emirate in which you are setting up. Generally, there is no fixed capital requirement for most activities, whereas specific activities may require a minimum capital investment.
If you want to establish a business in certain sectors, you need a local sponsor (a UAE national) who will hold at least 51% of the shares. However, certain business activities and conditions now allow 100% foreign ownership.
The process generally involves:
The setup process can take anywhere from a few days to several weeks, depending on the complexity of your business, the requisite approvals, and how quickly you can gather the necessary documentation.
Commonly required documents include:
Yes, once your business is registered and you have the required documents, such as a business license, you can open a corporate bank account in the UAE.
The UAE offers various tax advantages, including no corporate tax (except for certain industries), no income tax, and no capital gains tax in most cases. However, businesses must comply with relevant regulations and may be subject to VAT on specific goods and services.
Generally, a single license is issued for a specific business activity. If you want to operate different business activities, you must apply for additional licenses for each activity.
Questions and Answers about Mainland Business Setup in UAE