CONTEXT
Free zone companies are a popular and legitimate structure in the UAE — but they are frequently sold to entrepreneurs without adequate explanation of their limitations. These are structural issues, not administrative errors — and they require deliberate decisions to resolve.
LEGAL BASIS
- Federal Decree-Law No. 32 of 2021 on Commercial Companies
- Dubai Executive Council Decision No. 11 of 2025 — conditions for free zone companies conducting mainland activities
- Regulations of the specific free zone in which the company is incorporated
WHAT A FREE ZONE COMPANY CAN AND CANNOT DO
Permitted by default:
- Conduct business within the free zone
- Conduct business outside the UAE (export, international clients)
Not permitted without additional steps:
- Directly conclude contracts with UAE mainland clients
- Issue invoices to mainland customers
- Conduct regulated activities on the mainland
How mainland access can be obtained:
- Establish a mainland branch of the free zone company with the appropriate mainland licence and activity permits
- Incorporate a separate mainland co...