Difference between the Dubai mainland and the Free Zone

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 Many people from all over the world come to Dubai to set up their businesses there. The place is regarded as the business and investment hub of the world and is rightfully maintaining its position as one. The benefits offered by the place are immense and encourage people to choose the Emirate to set up their businesses.

However, one part that confuses people is whether they should go for a mainland or a freezone business setup. Both setups have their advantages and disadvantages. This blog takes into account the differences between a free zone and mainland company setup.

What is a free zone?

A free zone is a designated zone that offers a number of tax benefits. They are used to carry out economic activities and are regulated by their respective free zone authorities.

What is Mainland?

Mainland is the area of the emirate that excludes the free zones and is also called the onshore area. It is where most of the business activities are performed.

What are the benefits of setting up in a free zone?

There are several advantages to Dubai free zone company formation. These are as follows- 

  • 100% ownership of the company even as an expat 
  • 100% repatriation of the funds to the home place
  • Reasonable prices
  • A variety of options for choosing the business activities 
  • A number of free zones to choose from
  • Diverse business environment
  • Ease of doing business
  • Easy business setup procedures
  • Tax exemptions and benefits 

What are the disadvantages of setting up a business in a free zone?

There are a few disadvantages associated with business setup in Dubai freezone. They are mentioned below-

  • Freezone business get limited access to the local markets 
  • The trade is restricted by boundaries. They can trade only within free zones and not with mainland companies.
  • They are not allowed to conduct foreign trade.
  • The office spaces available are limited and thus they may even be expensive.
  • More stringent regulations and limited flexibility is available.

What are the advantages of business setup in Dubai mainland?

Business setup in Dubai mainland provides a number of advantages to those who are getting their business established here. These include- 

  • Unlimited local market access.
  • There are more offices available 
  • You can sponsor many visas under one licence 
  • No trade boundary restrictions 
  • The business activities available here are of a greater variety. 
  • 100% ownership for expats 
  • 100% repatriation of funds is allowed
  • There is a greater flexibility available for the entrepreneurs 
  • Ease of doing business
  • Easy business setup procedures
  • You can also work with the government and governmental organisations
  • State of the art technologies

What are the disadvantages of business setup in Dubai Mainland?

There are many advantages of business setup in Dubai Mainland. However, there are also a few disadvantages associated with the same. These are as follows-

  • Not all activities allow the expats to own 100% of their businesses 
  • The cost of setup are higher 
  • The taxes are comparatively higher here
  • The competition here is excessive
  • There is more bureaucracy here

What are the costs of setting up a business in Dubai mainland and free zone?

The costs of setting up a business on the Dubai mainland are higher than that in the free zone. However, they depend on a number of variables and factors that decide the cost of the business setup on the mainland or in a free zone. To know the exact cost and plan your budget accordingly, you can enter your details in the RadiantBiz cost calculator and get the information on the cost needed.

Which one is the better choice?

Both places have their advantages and disadvantages. Therefore, the best choice for you will depend on your business type, budget, needs, and a number of other factors. Therefore, it is better to consult with an expert before making your choice. 

We at RadiantBiz are some of the most reputed business setup experts in Dubai. We have helped over 100+ clients in our experience of 12+ years in the field. Our professionals work hard so that you can focus on the parts of the business you love. We help you right from the first step and believe that your business is unique. Our tailor-made strategies help your business realize its full potential. Get in touch with our experts and get started now.


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