Dubai Free Zone Companies on the Mainland: Resolution No. 11 of 2025 Explained

Dubai Executive Council Resolution No. 11 of 2025 regulates the operation of free zone companies on the Dubai mainland. In broad terms, it allows eligible companies licensed in Dubai free zones to apply for permission—through the Department of Economy and Tourism (DET), in coordination with their free zone authority—to carry out certain activities in mainland Dubai. Historically a free zone company wanting to serve mainland customers directly needed a distributor, a separate branch or a new mainland company. The resolution creates a more structured route.

Because this framework is relatively new and implementing details can evolve, confirm current eligibility, permitted activities and conditions with DET and your free zone before relying on it.

Many founders choose a free zone for its simplicity and later find that UAE mainland clients want to work with them directly. Before this framework, expanding onto the mainland usually meant forming and running a second entity, with its own licence, office and costs. A permit route can make it easier to test the mainland market or serve occasional mainland contracts without restructuring.

Eligibility is expected to depend on the free zone, the company’s activities and whether those activities are permitted on the mainland under DET’s framework. Companies must generally be in good standing, with valid licences and compliance records. Some activities—particularly regulated ones—may be excluded or require additional approvals. Companies licensed by free zones outside Dubai fall outside a Dubai resolution.

While exact steps may vary, the general pattern is:

Potentially, yes. A qualifying free zone person can pay 0% on qualifying income, but mainland-sourced revenue is generally non-qualifying and above a de minimis limit can jeopardise the regime. Operating on the mainland under a permit may therefore change your tax position. Take advice from a qualified tax adviser before applying. Standard rates are currently 0% up to AED 375,000 of taxable income and 9% above.

Yes. If most of your revenue will come from mainland customers, if you need a mainland office for staff, or if you want unrestricted local trading, a mainland company may be more straightforward than relying on a permit. The permit route is often best for free zone companies with occasional or growing mainland work rather than those whose core market is local.

Free zone companies in Dubai have several ways to serve mainland customers. The right one depends on how often you trade onshore and how much presence you need.

Processes are still bedding in, so treat this as an outline and confirm the current procedure with DET and your free zone.

An IT services company in a Dubai free zone had mostly international clients but began winning maintenance contracts with Dubai-based hotels. Setting up a separate mainland company would have duplicated licences and admin. After assessment, the permit route looked more proportionate, with the company continuing to serve its international clients from the free zone. If onshore work grows to dominate revenue, a branch or mainland company may later make more sense.

Tax matters too: income from mainland activities may affect qualifying free zone person status. Speak to your tax adviser before relying on the permit.

Dubai Executive Council Resolution No. 11 of 2025 set out a framework for free zone companies in Dubai to carry out activities on the Dubai mainland, for example through a permit issued by the Department of Economy and Tourism, subject to conditions. Previously, free zone companies wanting onshore activity usually needed a distributor, a branch or a separate mainland company.

Implementation details—eligible activities, approvals, fees and renewal conditions—are set by DET and the relevant free zone authorities and continue to evolve. We confirm the current procedure with the authorities before recommending it.

The permit route is typically most useful for free zone service businesses that win occasional or growing work from Dubai-based clients, and for companies testing the local market before committing to a full mainland structure. It is less suited to businesses whose main market is the UAE, which may still be better served by a mainland licence or branch.

The new flexibility is welcome, but it is easy to misunderstand.

We start by mapping where your revenue comes from and where it is heading, then compare the permit, branch and new-company routes against your activities, visa needs and tax position. We check the current DET and free zone procedure, prepare and submit the applications, and diary renewals and conditions so the permit does not lapse. Where tax is affected, we coordinate with your accountant or introduce a registered tax agent. Government fees are charged at cost, and you receive a written recommendation before anything is filed.

Think about how much of your revenue will come from mainland clients over the next two to three years, how much physical presence you need, and whether your onshore work is likely to affect your free zone tax position. A permit suits occasional or modest onshore work. A branch suits a steady onshore operation with its own office. A separate mainland company suits businesses whose centre of gravity has moved onshore.

Consider also the administrative load: each additional licence brings renewals, records and potentially separate bank accounts. The cheapest option on paper is not always the simplest to run. We set out the trade-offs side by side in your roadmap.

Confirm that your activity is eligible, what the permit allows and does not allow, how long it lasts, what it costs to maintain, and whether it affects your free zone tax status or visa arrangements. Check whether your clients’ procurement teams accept a free zone entity with a mainland permit. Keep your bank informed of any change in activity location.