By Adil Ahmad, Business Setup Consultant at Gulf Corporate Services
Summary
You cannot simply move a free zone license onto Dubai mainland, but you have clear options. Dubai free zone companies can now get a DET branch license or temporary permit to trade on mainland, open a sister mainland company, or close the free zone entity and relaunch on mainland. This guide compares each route, the steps, costs, visa and tax impact, and FAQs.
Can a Free Zone Company Trade on Mainland Dubai?
For years the answer was mostly no. A free zone company could trade inside its zone and abroad, but selling directly to mainland customers usually needed a local distributor or a separate mainland license.
That changed with Dubai Executive Council Resolution No. 11 of 2025. It allows free zone companies licensed in Dubai to operate on the mainland through a permit or license from the Department of Economy and Tourism (DET), with approval from their free zone authority. Financial entities in DIFC are excluded, and the DET publishes which activities qualify.
So today, “transferring” a free zone company to mainland usually means choosing the right route rather than moving the license itself.
Why Businesses Move From Free Zone to Mainland
- Direct access to UAE customers: sell to mainland clients without a distributor
- Government contracts: many tenders require a mainland license
- Physical locations: open shops, showrooms and branches anywhere in Dubai
- Flexible office choices: lease space outside the zone
- Visa growth: mainland visa quotas are linked to office size and can scale with the business
If you are still comparing structures, our business setup in Dubai team can map the best fit for your plan.
Free Zone vs Mainland at a Glance
| Factor | Free Zone Company | Mainland Company |
|---|---|---|
| Licensing authority | Free zone authority | DET |
| Trade with UAE customers | Through permit, branch or distributor | Directly |
| Office location | Inside the zone | Anywhere in Dubai |
| Ownership | 100% foreign | 100% for most activities |
| Corporate tax | 0% on qualifying income, if conditions met | 9% above AED 375,000 |
| Government tenders | Limited | Eligible |
Read more about each option in our free zone company setup guide. If your parent company is overseas, you may also consider a branch office in Dubai.
Your Four Options for Moving From Free Zone to Mainland
| Route | What Happens | Best For |
|---|---|---|
| DET branch license (Resolution 11 of 2025) | Free zone company gets a mainland branch license from DET | Ongoing mainland trading while keeping the free zone entity |
| DET temporary permit | Short term permit for specific activities | One off projects or testing the mainland market |
| New mainland sister company | Same owners or the free zone company set up a mainland LLC | Larger mainland operations, retail and government work |
| Close and relaunch | Cancel the free zone license and form a mainland company | Businesses that no longer need the free zone at all |
Option 1: DET Branch License for Free Zone Companies
Under the new framework, a Dubai free zone company can apply to DET for a branch license to work on the mainland. Reported fees are around AED 10,000 per year for the branch license, renewable annually. You need prior approval from your free zone, separate financial records for mainland activity, and an activity that appears on the DET list.
Option 2: DET Temporary Permit
For a specific project, a temporary permit can cover permitted activities for up to six months, with a reported fee of around AED 5,000. It is a practical way to test demand before committing to a full mainland setup.
Option 3: Open a Mainland Sister Company
You form a new mainland LLC, owned by you or by your free zone company. Both entities run in parallel. This is the classic “dual license” model and suits businesses that want shops, warehouses or large mainland teams. See our guide to mainland company formation in Dubai and LLC company formation in Dubai.
Option 4: Close the Free Zone Company and Relaunch on Mainland
If you no longer need the free zone, you can form a mainland company, move contracts, assets and staff, then cancel the free zone license. This is the closest thing to a full “switch” from free zone to mainland, but the mainland company is a new legal entity.
Step by Step: Moving a Free Zone Business to Dubai Mainland
- Review your activities and contracts. Check whether your activity is on the DET list and which route fits.
- Get free zone approval or NOC. Your free zone must approve a branch license or permit, or issue clearance before cancellation.
- Choose the structure. Branch, permit, sister LLC or new company.
- Reserve a trade name and get initial approval from DET if forming a new company.
- Draft the MOA or branch documents. See our memorandum of association guide.
- Lease mainland premises with Ejari if you need a physical mainland office or shop.
- Collect the mainland license or permit.
- Move or add visas. Transfer staff through the Ministry of Human Resources and Emiratisation (MOHRE) or keep them on free zone visas if your route allows. See mainland UAE visas.
- Update banking, VAT and contracts. Open a corporate bank account for the new entity where needed and amend VAT registration.
- Cancel the free zone license only if you chose the close and relaunch route.
Moving Between Free Zones or From Mainland to a Free Zone
Some businesses search for the reverse move, or want to change free zones, for example moving a company to Meydan Free Zone.
- Free zone to free zone: many free zones, including Meydan, accept re-domiciliation. The company keeps its legal identity, gets an NOC and exit certificate from the current zone, then receives a new license. Visas, establishment card and VAT details are reissued. See our Meydan Free Zone company setup and IFZA company formation guides.
- Mainland to free zone: usually done by forming a new free zone company and transferring the business, or through a re-domiciliation route where the receiving zone offers one.
- Changing your free zone agent or service provider: this does not change the company itself. You simply appoint a new consultant to handle renewals, visas and filings.
Documents Required
- Free zone trade license, MOA and share certificate
- Free zone NOC or approval letter
- Passport and Emirates ID copies of shareholders and managers
- Board resolution approving the branch, permit or new company
- Mainland tenancy contract with Ejari, where applicable
- Latest financial statements, where requested
- Staff list for visa transfers
Cost of Moving From Free Zone to Mainland
Costs depend heavily on the route. The figures below are approximate market estimates, plus the reported DET fees. Always confirm current charges.
| Cost Item | Approximate Cost (AED) |
|---|---|
| DET branch license for a free zone company | Around 10,000 per year |
| DET temporary permit (up to 6 months) | Around 5,000 |
| New mainland LLC trade license | 12,000 to 25,000 per year |
| Mainland office with Ejari | 8,000 to 60,000 per year |
| MOA, legal translation and attestation | 2,000 to 5,000 |
| Visa transfer per employee | 3,000 to 6,000 |
| Free zone license cancellation | 2,000 to 10,000 |
For full fee details, see our Dubai mainland license cost guide and Dubai mainland company formation cost.
Corporate Tax and VAT Impact
The tax effect is often the deciding factor:
- Qualifying free zone income: a qualifying free zone person can pay 0% corporate tax on qualifying income, but must keep non-qualifying revenue within the de minimis limit.
- Mainland income: profit from mainland trading is generally taxed at 9% above AED 375,000. Income through a mainland branch is usually treated separately, so keep clean books.
- New mainland company: pays 9% on taxable profit above AED 375,000 and files its own return with the Federal Tax Authority.
- VAT: 5% applies to most supplies. Group or separate VAT registration may be possible, so plan this early.
Our corporate tax services and VAT and tax consultancy teams can model which route costs you less.
Common Mistakes to Avoid
- Trading on mainland without a DET permit or license
- Cancelling the free zone license before the mainland entity is ready
- Losing qualifying free zone tax status by mixing mainland revenue
- Moving staff visas in the wrong order and creating gaps
- Forgetting to update bank, VAT and client contracts with the new entity
Expert Tip From Our Consultants
Do not close a working free zone company in a hurry. For most clients, the smartest first step is a DET branch license or temporary permit, which lets you test mainland demand while protecting your free zone benefits. Once mainland revenue becomes the larger share, a mainland sister company usually makes more sense. Review your tax position at each stage.
Frequently Asked Questions
Can a free zone company trade in mainland UAE?
In Dubai, yes, through a DET branch license or temporary permit under Executive Council Resolution No. 11 of 2025, if your activity qualifies and your free zone approves.
Can I transfer my free zone license directly to mainland?
No. The license itself does not move. You either add a mainland branch or permit, open a mainland company, or close and relaunch.
Do I need to close my free zone company?
Not necessarily. Many businesses keep the free zone company and add a mainland branch or sister company.
How long does it take to switch from free zone to mainland in Dubai?
A permit or branch license can take a few weeks. A new mainland company typically takes one to three weeks, plus time for visas and banking.
Can I move my company from another free zone to Meydan Free Zone?
Yes. Meydan accepts re-domiciliation from other free zones once your current zone issues an NOC and exit certificate.
Will I lose 0% corporate tax if I trade on mainland?
Possibly. Mainland income is generally taxed at 9%, and too much non-qualifying revenue can affect free zone tax status. Get advice first.
Can my employees move to the mainland company?
Yes. Their visas can be transferred through MOHRE, or kept on the free zone company if your route allows them to work on mainland projects.
Is there a free zone to mainland company migration service?
Yes. Consultants like Gulf Corporate Services handle approvals, licensing, visas, banking and tax for the whole move.
Plan Your Move to Mainland With Expert Support
Gulf Corporate Services helps free zone companies expand into Dubai mainland through branch licenses, permits and new mainland companies. We manage approvals, visas, banking and tax so your business keeps running smoothly. Speak to our business setup consultants for a free route assessment.
