Company Formation

Types of Company Formation in Dubai

1. Mainland Company:

   • Overview: A mainland company allows businesses to operate within Dubai and across the UAE without restrictions. Mainland companies can engage in a wide range of business activities, including commercial, industrial, and professional services.
   • Ownership: Previously, foreign investors were required to have a local Emirati partner who would own 51% of the company. However, recent reforms allow 100% foreign ownership in many sectors.
   • License Types: Includes commercial, professional, and industrial licenses.
   • Office Space Requirement: A physical office space is required to establish a mainland company.
   • Advantages: No limitations on the scope of business activities, the ability to bid on government projects, and access to the wider UAE market.

2. Free Zone Company:

   • Overview: Dubai has several free zones, each catering to specific industries. Free zone companies are popular among foreign investors due to the numerous benefits offered.
   • Ownership: 100% foreign ownership is allowed.
   • License Types: Varies depending on the free zone but generally includes trading, service, industrial, and holding licenses.
   • Office Space Requirement: Free zones typically offer flexible office solutions, including virtual offices, shared workspaces, and full-fledged offices.
   • Advantages: Zero corporate tax, 100% repatriation of profits, no import/export duties, and simplified incorporation process.
   • Limitations: Free zone companies are generally restricted to operating within the free zone or internationally. They cannot directly trade within the UAE market without a local distributor.

3. Offshore Company:

   • Overview: Offshore companies are established primarily for holding assets, international trade, and tax planning. They are not permitted to conduct business within the UAE.
   • Ownership: 100% foreign ownership is allowed.
   • Advantages: No corporate taxes, confidentiality of shareholders, flexible business setup, and no requirement for a physical office.
   • Limitations: Offshore companies cannot operate or conduct business with UAE residents or entities.