What types of companies can foreigners open in the UAE?

In the UAE, foreigners have the option to establish mainland, offshore, or free zone companies. Mainland companies have the flexibility to operate throughout the Emirates and across various sectors, although certain activities may require a local partner. Companies registered in free zones can operate exclusively within the designated economic zones or outside the country. These companies enjoy a range of tax benefits and do not require a local partner for incorporation. Offshore companies, on the other hand, are limited to conducting business outside the UAE but can take advantage of the incentives and advantages provided by the Emirates for international business.

Mainland Company

A mainland company can be registered in any emirate. Each emirate has its own registering authority, such as the DED (Dubai Economic Department) in Dubai. These types of companies have the ability to operate throughout the UAE and in other Gulf countries. If a mainland company is registered in Dubai, the entrepreneur can lease or purchase an office in any area of the city.


  1. Fast registration process: Registering an organization can be completed in just a few hours.
  2. Ability to obtain UAE tax residency status.
  3. Opportunity to participate in government tenders and secure contracts from the government.
  4. Option to obtain a residency visa: Business owners and their employees can apply for a 2-year residency visa.
  5. Accessible financing: Banking institutions often offer favourable credit terms to local companies.


For certain types of activities, the presence of a service agent or partner is required. The specific list of activities can be obtained from the registering authority.

Note: Starting from June 1, 2021, the Commercial Companies Law came into effect, allowing foreign business individuals to have 100% ownership of local companies across more than 1,000 types of activities.

Areas of Activity

Mainland companies can operate in over 2,000 different sectors. These sectors are listed on the website of the Department of Economic Development (DED). The most popular sectors include industrial, commercial, trade, and tourism activities.

Important! When registering a business, the company owner can choose only one sector of activity or multiple sectors if they belong to the same group.


There are three types of licenses available for mainland companies:

License type Areas of activity
Professional trade license Provision of professional services such as consulting, intellectual activity or related to art, etc.
Commercial trade license Trade in the UAE and the provision of services in real estate, healthcare and construction.
 Industrial trade license  Production of various products.

Free Economic Zone

CompanyFree economic zones (FEZs) in the UAE are designated areas within the country where foreigners can become full owners of companies, with 100% of the share capital belonging to them. Specific benefits and privileges are provided to entrepreneurs in these zones. Companies operating in FEZs can avail the special conditions tailored to specific business sectors.


  1. Companies in free economic zones (FEZs) can engage in international trade and conduct business both within and outside the FEZ.
  2. Entrepreneurs who register their companies in FEZs can have full control over their business operations and decision-making.
  3. Owners of FEZ companies and their employees can obtain a residency visa, allowing them to reside and work in the country on a permanent basis. The number of available visas will depend on the office space area.
  4. Companies registered in FEZs are exempt from import duties on raw materials and export duties on finished products.
  5. Companies in FEZs have the right to own assets, including real estate.
  6. Companies registered in FEZs can obtain tax residency, granting them the right to avoid paying taxes in their home country.

Important! An entrepreneur is exempt from paying taxes if they possess a Tax Residency Certificate (TRC). The TRC is issued by the Federal Tax Authority (FTA) and allows both individuals and legal entities to avoid paying taxes in their second country of permanent residence.


  1. Some free economic zones (FEZs) are oriented towards specific industries or types of businesses, which can limit entrepreneurial opportunities.
  2. Companies registered in FEZs can only lease office space within their respective FEZ. However, some FEZs may allow companies to lease office space outside the UAE.
  3. Inability to participate in government tenders.

Areas of Activity

Each free economic zone has its own list of permitted activities. Let's consider a few of the most popular FEZs:LicenseThere are three main types of licenses in free economic zones (FEZs):

Sharjah Airport International Free Zone (SAIF)Almost all types of activities, in particular the trade of gold, jewellery.

Free Economic Zone Areas of activity
Dubai Multi Commodities Center (DMCC) More than 600 types of activities: energy, healthcare, education, financial services, etc.
Jebel-Ali Free Zone (JAFZA) Trade, warehousing and storage, transport parking, import of raw materials, creation of new products, etc.
 Sharjah Airport International Free Zone (SAIF) Almost all types of activities, in particular the trade of gold, jewellery.
Ras Al Khaimah (RAK FTZ) More than 50 types of activity: industry, warehousing, banking and financial services, etc.
Dubai Knowledge Park (DKP) Development of educational technologies, recruiting, language learning, art, development of children's skills.


There are three main types of licenses in free economic zones (FEZs):

License type Areas of activity
Services license For companies engaged in consulting, tourism, information technology, medical and educational services, advertising, design, etc.
Trading license For companies engaged in import, export, wholesale and retail trade of various goods, etc.
Manufacturing license Allows companies to use infrastructure facilities and SEZ resources for the production of goods.

Offshore Company

Entrepreneurs who do not intend to conduct business within the UAE can establish offshore companies. These organizations are registered in one of the free economic zones (FEZs) where they can obtain a legal address and can avail all the incentives and advantages provided in the Emirates for international business.Offshore companies in the UAE can only operate outside the Emirates. They are not permitted to have an office within the UAE, but instead utilize the office of their agent.


  • Entrepreneurs can open corporate accounts in UAE banks.
  • Preferential rates when repatriating dividends to the parent company in the UAE.
  • Real estate can be registered under the offshore company.
  • Entrepreneurs who open an offshore company can become shareholders or own shares in other organizations registered in the UAE.


  1. Business activities can only be conducted outside of the UAE.
  2. Lack of tax residency status.
  3. Owners and employees of offshore companies cannot obtain business residency visas in the UAE.
  4. Opening a bank account for an offshore company can be quite challenging.
  5. No physical address and inability to lease office space.
  6. Limitations in terms of business sectors.

Areas of Activity

Offshore companies can engage in various sectors except for insurance, banking, oil and gas-related industries, precious metals, media, and aviation. Offshore organizations are well-suited for holding activities, including real estate ownership, and other asset management purposes.


Since offshore companies in the UAE can only conduct business outside the country, they do not require business licenses. Only a registration certificate is needed.


If you want to conduct business both within the UAE and outside its borders, a mainland company would be the best option. For entrepreneurs looking to reduce their administrative burden or be exempt from import and export duties, a free economic zone would be suitable. Offshore solutions are ideal for entrepreneurs who do not plan to operate within the country but still want to enjoy all the advantages of conducting business in the UAE.