POLARIS - Business Setup in Dubai

Mainland Companies in UAE
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OVERVIEW

What is a UAE mainland company? A mainland company is a company registered with DED (Department of Economic Development) in a certain Emirate of Dubai.

The mainland company is a local company which is licensed to conduct the approved activities in the relevant Emirate. In come cases, a local shareholder (“Sponsor”) or a local service agent is required for setting up a local company.

Q: When do I need a mainland company?

For project contracting, retailing and some other specific activities to be contracted in the UAE, only non-free zone companies (commonly known as "mainland companies" or "DED companies") or branches of foreign companies in the UAE are permitted by law to do them. The vast majority of foreign investors choose to set up a company in Dubai in the form of a free zone company if they don’t engage in such “local business”.

Q: Legal forms for a Mainland company?

A separate new company (including a subsidiary) can be established, or a branch can be established as an option. After June 1, 2021, most activities can be carried by a mainland company fully owned by a foreign person. This is a major change to the UAE company formation, as before that a mainland company needed to have a local Emirati to be a shareholder holding 51% of the company shares or for a branch, it needs to have a local to be the local service agent ("local service agent") of the branch.

Q: What industries is a Mainland company suitable for?

Local companies are suitable for industries that need to carry out construction projects and open stores locally for retail, such as construction engineering, oilfield engineering contracting and catering industries.

Q: What is the fiscal and tax policy to a Mainland company?

Like free zone companies, local companies have no corporate and personal income tax, but their local product sales and service provision must pay 5% value-added tax; this tax is borne by the final consumer or service user, so the service provider or product Seller can offset their input VAT against output VAT.

Q: Office and warehousing options?

Customers can choose according to their needs to control costs.

Seek professional support?

The process to set up a mainland company is tedious and sometimes confusing, you are suggested to get professional support to this end, and we are more than happy to share with you our expertise on setting up a mainland company in the UAE.