Should I start a company in Dubai Mainland or Free zone?
Mr. Fedrick Romello is the owner of a grocery chain in Dubai. He has several companies across the European continents, however, while entering the global market Mr. Romello thought that business setup in Dubai would be the correct option for all the right reasons. He said, “Dubai is a land of entrepreneurs and is the perfect commercial hub to start a business. Business setup in Dubai does not only provide tax advantages but also offers a huge market to sells your goods and services as it is centrally located in the world. Moreover, with governmental encouragements, technological advancements and well-organized infrastructure makes business setup in Dubai even more favorable”, he added
But Mr. Romello was confused about where exactly to start his business in Dubai. He said, “Dubai is the only region with a lot of free zone jurisdictions offering business development and growth. However, as I learned more about the free zones in Dubai, I understood that free zones are special economic zones providing entrepreneurs perquisites as well as restrictions on various grounds.”
“On the other hand, starting a business in Dubai mainland offered me a better growth and widened market”, noted Mr. Romello. He said, “Business in Dubai mainland provided me the convenience of transportation and I could have my grocery stores across Dubai in the most prominent locations without any restrictions. Dubai Mainland gave my business a better reach socially, economically and demographically.
Mr. Romello started his business in Dubai Mainland, nevertheless, each business is different and has a different requirement. We at Shuraa business Setup give expert advice where you should start a business in Dubai to allow your company a successful future.
Difference between Free Zone and Mainland
If you are not sure whether to start a business in Dubai mainland or free zones then take a look at the distinguishing table below:
Dubai Free zone
|Dubai free zone is a special economic zone providing regional benefits. Dubai Free zone is monitored by an independent governmental or non-governmental free zone authorities and entities.||Dubai Mainland is an economic zone monitored by the Department of Economic Development (DED). The Department of Economic Development is a governmental body.|
|Business setup in Dubai free zone offers 100% foreign ownership.||Dubai mainland company formation offers complete control over your business, but you do need a have a local sponsor.|
Area of Business
|Companies in Dubai free zone are allowed to do business only within the free zone or outside the country. Free zone companies are also restricted in terms of the area they could do business.||Dubai Mainland companies have no restrictions and are allowed to do business anywhere in the UAE and across the globe.|
Control on Business
|Free zone companies may enjoy 100% ownership, but the jurisdiction is controlled by private free zone entities that may change the rules applied to the free zone anytime.||Dubai mainland companies are controlled by legal governmental bodies that protect you and your company. Dubai mainland companies are in accordance with the legally contracted terms.|
|Getting a free zone license is done through a single window system. A business set up in a free zone may require certifications from various judicial bodies. However, the process is integrated by an independent free zone authority.||Getting a mainland license requires assessed documents and permissions. The process involves administrative authorities, but the company is incorporated into the economics department.|
|The cost of starting a business in Dubai free zones depends on the nature and the size of the business. Also, each free zone has its own costs, while some Dubai free zones also have the criteria of minimum share capital, that further increases the company formation cost.||Cost of setting up a business in Dubai mainland may involve a lot of variables. You can start a business in Dubai mainland for a minimum price of AED 25,999 (all inclusive). Yet, it also depends on the business type, the number of shareholders in the company and the space you rent for your office.|
|The free zone is not a cost-effective option as it restricts the scope of the company. There are limits on whom and where the business can be taken place. Moreover, for budding entrepreneurs Dubai free zone business setup can be an expensive option and they can venture other free zones out of Dubai to find cheaper options.||Dubai mainland is a better option in comparison with free zones at it offers extended business opportunities and drafts a future for the company. It also a reasonable option for SMEs and budding entrepreneurs as the entire business along with one visa can be started at only AED AED 25,999 in any part of Dubai.|
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