Over the years, Dubai has emerged as an attractive destination for entrepreneurs around the world. Its position, growing economy, and business-friendly policies make it a perfect place to laundere a business. Another golden opportunity is to start a company on the Mainland of Dubai if you are considering expanding to Dubai. This guide illustrates the step-by-step process for Dubai mainland company setup, its benefits, costs, and a couple of pitfalls to pay attention to along the way.

 

What is Dubai Mainland?

Dubai Mainland is a category from which businesses are permitted to conduct free trade in the local market, including trading with municipalities and government entities. Operating a business in the mainland of Dubai allows you to operate freely throughout the UAE without any geographical restrictions.

These include a wide customer network, no limits on the location of business activities, and easier expansion options. Unlike Free Zones, which are sector-specific and constrained to a Free Zone in which to do business, Dubai Mainland businesses can operate throughout the UAE and internationally.

 

Guide to Establishing a Dubai Mainland Company

How to Set Up a Dubai Mainland Company? Here’s an easy-to-follow rundown of how it works:

Select Your Business Activity

When establishing a Dubai Mainland company, the first step is to specify your business activity. The Department of Economic Development (DED) in Dubai provides an extensive list of licensed activities for all types of businesses, such as trade, services, manufacturing, and much more. The type of license required depends on the nature of your business activity.

Choose a Business Structure

Next, you will need to select a legal structure for your business. In general, the most conventional types of business on the Dubai Mainland consist of a Limited Liability Company (LLC), Sole Proprietorship, and Branch Office. As a foreigner, you have the option to set up a Limited Liability Company (LLC). In this most popular company structure, you and a foreign national would be the only owners, except 49% being owned by you (a UAE national sponsor must own the remaining 51%).

Find a Local Sponsor

Most Mainland businesses require a local partner. This UAE national will own 51 percent of the company’s shares, and you, the investor, own 49 percent. The sponsor is typically passive, and you maintain complete control over the daily operations of your business.

Register Your Company Name

They will help you choose and register a name for your company. The name can’t include any offensive or obscene language to ensure a distinction between the name and any existing family business name.

Get the Required Licenses

After completing the above steps, you would need to apply for a business license from the Dubai Department of Economic Development. The nature of your business activity will determine the type of license you need, whether commercial, professional, or industrial. You want to ensure that your license protects all your business activities.

Consider Office Space and Complete the Legal Steps

This is the last step; before you proceed with this, you will need to rent an office in Dubai since that is required for a Mainland company. The Dubai Economic Department should approve such office space. Upon securing your office, you will sign the contract with the landlord, complete the legal formalities, and receive your trade license.

The Benefits of Being in Dubai Mainland?

There are many key benefits when it comes to registering as a business on the Mainland of Dubai. Here are a few key benefits:

Access to a Greater Market

Establishments of Dubai Mainland allow you to function wherever in the UAE and to deal with nearby customers and government substances. This gives you a massive advantage over Free Zones that have geographical limitations.

No Restrictions on the Ministry

In contrast to Free Zones, Dubai Mainland businesses do not have limitations on specific industries or business activities. You can add a Harrison or expand your business when you need it.

Hiring Flexibility is Guaranteed

Dubai Mainland companies are allowed to hire employees from any country, giving them a larger talent pool to choose from.

Unlimited Expansion Flexibility

Since Dubai Mainland businesses are not confined to any zone, you have the flexibility to open branches anywhere, enter new markets, and grow your business.

 

Cost for Dubai Mainland Company Setup

Starting and establishing a Dubai Mainland business may be an expensive task. The costs will depend on the business type and the licenses you need. This initial setup cost typically averages between 20-50,000 AED! Which can include government fees, office spaces, and legal issues.

Business License: A business license fee generally costs anywhere from AED 10,000 to AED 15,000, varying by business activity.

Office Space: A major expense is renting office space in Dubai. A small office costs between AED 15,000 to AED 30,000 per year.

Local sponsorship fees: It depends on the agreement you have with your UAE sponsor.

 

Advantages of Dubai mainland company formation

Unlimited Business Scope

In Dubai Mainland company setup, the scope of business is unlimited, as there are no restrictions on the type of business activity you can carry out in the UAE. You don’t have to be in any miner market or geographical boundaries.

Total Control

You have total control over your company’s operations, management, and finances, making it a great option for entrepreneurs who want to run their businesses independently.

Global Exposure

A city like Dubai offers exposure to many international markets and clients. A Mainland company could easily open up to the world.

Challenges in Setting Up a Dubai Mainland Company

Local Sponsor Requirement

One of the challenges of setting up a company in Dubai Mainland is the requirement of a local sponsor. You also have to be careful when you are entering with a passive/anchor sponsor.

Difficulty & Expenses

This may involve more difficulties and expenses than establishing in a Free Zone. (such as government charges, office rent, and sponsorship)

 

Conclusion

There are several advantages to establishing a Dubai Mainland company: a well-defined market, freedom of activities, and potential for international business. Without local sponsors required and initial cost, the benefits usually exceed the drawbacks. Getting professional help can be extremely useful in completing your setup. Businesses such as GlobalBusinessSetup.com can provide you with the expertise and help you need to start your business the right way.

 

Frequently Asked Questions

What is the difference between UAE Free Zone and Dubai Mainland?

Dubai Mainland Companies can trade across the entire UAE and get involved with local government entities, while Free Zones have geographic and industry limitations.

Can I own 100% of my Dubai Mainland company?

Generally, foreign investors may own 49% of a Dubai Mainland company; thereafter, a local sponsor holds the balance of 51%. There are exceptions (e.g., for certain activities or when establishing a professional service company).

What is the time required to register a Dubai Mainland company?

From here, the process generally ranges and will take around 2 to 4 weeks, depending on the complexity of your business and the licensing requirements.