Different Operating Jurisdictions in UAE – Mainland or Free zone or Offshore
Dubai is a tourist and business attraction for people across the world. Like tourists search for the best places to visit in UAE, entrepreneurs search for the different types of Business Setup in UAE. Many startup owners struggle the juggle between setting companies in the mainland, offshore, or free zone. But now it is time for your worries to an end with this blog. The blog highlights the difference between the three places.
For selecting the location, the first thing to consider is the type of business you plan to set up in the UAE. For instance, where the trading business will flourish better in the mainland, a tax-free environment will be available only in the free zone. Similarly, an entrepreneur who is not willing or can’t afford to set up an office in UAE should opt for an offshore Business setup in UAE.
Business Setup in UAE
Let’s discuss the 3 different types of Business Setup in UAE in details:
- A Mainland company can have either a commercial license or professional license. The former offers 49% ownership to ex-pat and 51% to UAE nationals. A local service agent is appointed to be the 100% ownership of the ex-pat with a UAE national
- Free zone company allows 100% ownership to ex-pat without the need for any UAE national or service agent.
- For an offshore company setup, you cannot run a business in Emirates; else, you can only get a certificate of incorporation.
Office Space & License
- A minimum of 200 sq ft area needs to be leased out annually for a mainland license. The license is issued by the Department of Economic Development (DED) after receiving the Ejari Certificate from the land department
- In the free zone, it is not mandatory to have a physical office. It is allowed to use standard business center desks for at least 5 hours a week. It is an excellent opportunity for newcomers to have security and save money invested in registration. Therefore it is popularly known as Smart office or Flexi desk.
- There’s no scope for office space as the primary motive of offshore company setup is the protection of assets
- Mainland company setup allows owners to carry any commercial or professional activity in the local market or outside the UAE or in any free zone.
- Free zone business allows you to carry business in the same free zone or outside the country but not anywhere else in the UAE. But the significant advantage of being tax redemption.
- Offshore company formation is basically for wealth and assets protection. It is to run business privately with no involvement of Emirates in financial matters.
Many differences and different rules being followed in the Mainland, Offshore, and FreeZone Companies from government authorities in the Visa Process, Business Link UAE is here to solve all your problems at the earliest and help you finalize which place can be the best for you. We are a decade-old business consultancy in the UAE and here to guide our clients throughout their journey in the country.
To learn more about different types of Business Setup in UAE, Get in touch with us:
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