Free zone companies are exempted from doing business outside their jurisdiction
Free zone is a jurisdiction or a region offering easy company formation, uniquely designed for international businesses and foreign investors. Free zone companies in Dubai receive tax benefits and 100% ownership to expatriates.
As per law, the Department of Economic Development (DED) is the only accountable authority for issuing licenses outside the free zone.
Free zone jurisdictions do not authorize companies registered under the free zone authorities to conduct business in Mainland Dubai. Most trading companies in the free zone are completely restricted to do business in Dubai Mainland. But few professional companies are given leverage.
A restricted free zone company can proceed with doing business in Dubai Mainland by getting specific license approvals and the right documentation from the Department of Economic Development (DED) in Dubai.
Free zone companies can also opt to get connected with a distributor who has a DED license to further proceed with doing business in Dubai Mainland.
Besides this, free zone companies can conduct business in Dubai Mainland through a civil work company, limited liability company or by establishing a branch office.
This depends on the type of activity being conducted and the nature of business. Proposed location of the business also matters. Trading companies act as distributors and sell outside the free zone through other agents or re-sellers.
Service-related companies like consultancy firms; are pretty straightforward. Contracting, Maintenance, Real estate and some other businesses would be more suitable in a non-free zone area.
Also, restaurants, gyms, retails outlets which are very location dependent makes more sense to operate in the non-free zone area.
For any further queries or to understand the difference between a Mainland business setup and free zone company formation speak to our professional business adviser.
The most important part is to understand which jurisdiction best fits your line of business activity and how economical the particular option is.
PMC Solutions DMCC is a Corporate Service Provider specialized in designing bespoke solutions for Business Setup, and Family Residency for foreign and local investors, willing to establish and grow their businesses in the entire UAE.
PMC Solutions has been established to provide complete company incorporation, administration and management services in all major jurisdictions in the UAE where it is pioneering the concept of Free zone and Offshore Incorporation.