Types of Companies in the UAE
A comprehensive comparison of Mainland, Free Zone, and Offshore companies in the UAE: ownership, activities, cost, and visa eligibility.
Updated:
The UAE offers three main legal structures for foreign businesses. Each has distinct advantages, restrictions, and use cases.
Quick Comparison
| Feature | Mainland | Free Zone | Offshore |
|---|---|---|---|
| Ownership | 100% (most sectors) | 100% | 100% |
| Operate in UAE market | ✅ Yes | ⚠️ With distributor | ❌ No |
| Residency visa | ✅ Yes | ✅ Yes | ❌ No |
| Physical office required | ✅ Yes | Flexi-desk OK | ❌ No |
| UAE bank account | ✅ Easier | ✅ Possible | ⚠️ Harder |
| Min. cost/year | ≈ AED 37,000 | ≈ AED 15,000 | ≈ AED 11,000 |
Mainland Companies
Mainland companies are registered with the Department of Economic Development (DED) in each emirate. They can operate anywhere in the UAE and internationally.
Best for:
- Businesses wanting to sell directly to UAE customers
- Companies needing government contracts
- Businesses with local distribution or retail
Key facts:
- No requirement for a local sponsor since the 2021 reform (for most activities)
- Physical office with a valid Ejari lease is mandatory
- Regulated by each emirate’s DED
- More activity options than Free Zones
Free Zone Companies
Free Zones are special economic zones with their own regulatory authorities. There are ~45 free zones across the UAE.
Best for:
- International businesses and consultants
- E-commerce and digital services
- Trading companies importing/re-exporting
- Entrepreneurs seeking quick, low-cost registration
Key facts:
- 100% foreign ownership (always, even before the 2021 reform)
- 0% corporate tax on qualifying income within the free zone
- Cannot sell directly in the UAE market without a distributor
- Flexi-desk (shared workspace) counts as a registered address
Offshore Companies
Offshore companies (RAK ICC, JAFZA Offshore, etc.) are legal entities registered in the UAE but not permissible to trade inside the UAE.
Best for:
- Holding companies and asset protection
- International IP holding
- International trading between third countries
- Privacy-sensitive ownership structures
Key facts:
- No residency visa issued
- No UAE bank account (may be possible with some banks)
- Cheapest annual cost
- No physical presence required
Which Should You Choose?
Choose Mainland if you want to serve UAE-based customers directly or bid for government contracts.
Choose Free Zone if you work internationally, remotely, or want a cost-effective solution with residency.
Choose Offshore if you need a holding structure or operate between foreign countries with no UAE sales.
Need help deciding? We’ll analyse your business model and recommend the right structure. Contact us.