How Do Mainland, Free Zone, and Offshore Differ From Each Other?

It is not advisable for an investor to conduct a business setup in UAE at a certain location in the UAE simply because someone you know has found success there. A study and an expert advice are needed for you to see where your business will most likely be suited before deciding to have a business setup in Dubai or in another Emirate.

What Do You Get in the Mainland?

If a company is established in the mainland, it will be licensed by the Department of Economic Development (DED) of wherever Emirate it is.

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It should be noted that the business owner will not have 100% ownership of the business. A local sponsor will get 51% of the shares of your company.

However, companies in this place will be able to trade in the local market and out of the UAE. There are also choices of establishing a business in malls or buildings in a city. If you are looking to target the local residents and the market, a business setup in Dubai or whichever Emirate is for you.

What Does It Mean to Have a Free Zone Company?

The idea of free zones was made to help businesses to grow and develop. In the UAE, it was created to appeal to the companies that deal with trade and export.

A free zone in the UAE usually means that it comes with a package of attractive benefits. Business setup in UAE free zones have benefits that include 100% ownership, 0% income and corporate tax, 100% repatriation of capital and profits, quick and smooth processing of license, etc. These zones are also known to have warehouses and are industry-specific, which means that they can cater to the exact needs of your company. They focus on the requirements of a nature of a business. With this, it’s easier for investors to grow even more.

What Does the Offshore Provide to Investors?

An offshore company simply means that someone from outside the UAE can have an offshore company without having any physical office or being here at all, but they cannot conduct any business in the country. Offshore companies in UAE receive the benefits that a free zone has to offer. Offshore companies are permitted to have bank accounts in the UAE. They can own investments as well as purchase real estate. Certain offshore authorities in the UAE have regulations that allow investors of offshore companies to have their property and assets to be confidential.

Learn more about business startup in UAE here MAF Consulting Middle East

Differences of the Three in a Nutshell

Basically, when you have a business setup in UAE on the mainland, you cannot totally own it but has to share it with a local sponsor. Although you can trade in the heart of Dubai, being near to your clients.

Business setup in UAE free zones means that you have 100% ownership of your business. Companies here are usually focus on trade and import/export. It is usually far from the city.

On the other hand, owners of offshore companies in UAE enjoy the benefit of doing business outside the UAE but can open bank accounts and own properties in the country.

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