A Comprehensive Guide to Dubai Mainland Company Setup

Business Feb 13, 2025 40 Add to Reading List

Dubai is renowned as a global business hub, attracting entrepreneurs and investors from around the world. One of the key reasons for its popularity is the ease of setting up businesses within its borders. In this article, we’ll explore the essential steps and considerations for a Dubai mainland company setup, helping you understand why it’s an excellent choice for businesses looking to operate within the UAE’s lucrative market.

What is Dubai Mainland?

Before delving into the setup process, it’s important to clarify what the Dubai mainland refers to. A mainland company is a business that is registered under the UAE government’s jurisdiction. Unlike free zone companies, which are limited to certain industries and locations, mainland companies have the flexibility to operate anywhere within Dubai and the rest of the UAE. They can also take on government contracts and serve the local market directly, making them ideal for a wide range of businesses.

Benefits of Setting Up a Mainland Company in Dubai

Setting up a mainland company in Dubai offers several advantages:

Unlimited Market Reach: Mainland companies can trade directly with the local market, giving you the ability to expand without geographic restrictions.
No Restrictions on Number of Employees: There are no limits on the number of employees you can hire, which is crucial for businesses that require a larger workforce.
Access to Government Contracts: Mainland companies can enter into contracts with government entities, which can be a significant business opportunity.
Ownership Flexibility: While some industries require a local sponsor (UAE national) holding 51% of the company’s shares, certain activities allow 100% foreign ownership, especially for professional services.

Key Requirements for Dubai Mainland Company Setup

When establishing a mainland company, several key requirements must be met:

Local Sponsor or Service Agent: For most business activities, a local sponsor is required to hold 51% of the shares. However, in professional services (such as consulting or legal services), you can retain 100% ownership by appointing a local service agent instead.
Business Activity Approval: The Department of Economic Development (DED) in Dubai approves your business activities. It’s important to ensure that the activities align with the Dubai mainland guidelines.
Office Space: Unlike free zone companies, mainland businesses are required to have a physical office space in the city. The office space must meet the legal requirements set by the DED.
Trade Name Registration: The business name should reflect the nature of your business and adhere to specific naming conventions set by the UAE authorities.

Steps to Set Up a Mainland Company in Dubai

Choose Your Business Activity: The first step in setting up a Dubai mainland company is determining the nature of your business. The DED provides a wide range of approved activities, and your choice will dictate the legal structure and permits required.
Find a Local Sponsor or Service Agent: As mentioned earlier, for most business types, a local sponsor or service agent is necessary. It’s crucial to choose someone trustworthy, as they will hold a majority share in the company.
Register Your Company Name: Once you’ve selected a business activity, the next step is to choose an appropriate trade name for your company. This name must comply with the UAE’s naming conventions, and you’ll need to submit it for approval to the DED.
Submit Your Documents: The necessary documents for company registration include your passport copy, business plan, proof of address, and other specific documents based on your business type.
Lease Office Space: After registration, you must secure a commercial office space that complies with the DED’s requirements. This is a crucial step to ensure that your business can operate legally.
Obtain Licenses and Permits: Depending on the business activity, you will need to obtain specific licenses. The most common licenses include trade licenses, industrial licenses, and professional licenses.
Visa and Employment Setup: After completing the company registration, you can apply for visas for yourself and your employees. This includes residence visas and work permits as required for your business.

Costs of Dubai Mainland Company Setup

The cost of setting up a mainland company in Dubai can vary based on several factors such as the business activity, office location, and legal requirements. On average, the initial setup costs can range from AED 15,000 to AED 50,000, including registration, office lease, and other administrative costs. It’s advisable to consult with a local business setup consultant to get a clearer estimate based on your specific needs.

Ongoing Compliance and Taxation

Dubai mainland companies are required to adhere to specific compliance requirements, such as annual license renewals, bookkeeping, and financial reporting. However, one of the most appealing features of operating a mainland company in Dubai is the absence of corporate income tax. The UAE has a favorable tax environment, with no personal income tax and a business-friendly regulatory framework. The introduction of VAT at 5% is one tax that businesses need to account for.

Why Choose a Mainland Company for Your Business?

Dubai’s mainland offers unmatched flexibility and growth opportunities for businesses, especially those looking to tap into the local market or engage in government contracts. If your business needs a physical presence, a Dubai mainland setup is your gateway to success. The process is streamlined, with guidance from government entities and local consultants ensuring compliance with all necessary regulations.

Conclusion

Setting up a Dubai mainland company is a strategic move for businesses aiming to establish a footprint in the UAE market. With its clear benefits—such as access to the local market, the ability to take on government contracts, and minimal restrictions on operations—Dubai remains one of the most attractive business destinations in the world. By following the proper steps, obtaining the right licenses, and adhering to legal requirements, you can position your company for success in this dynamic and profitable business environment.