Mainland, free zone or offshore: which UAE structure fits a foreign company?
Three ways to hold or run a business in the UAE. What each allows, who it suits and the questions to ask before you choose.
Foreign companies entering the UAE usually choose between a mainland company, a free zone company or an offshore entity. The right answer depends on who you sell to and what the company needs to do.
Mainland company
- Trade directly with customers anywhere in the UAE
- Bid for government contracts
- 100% foreign ownership for most activities since 2021
- Suits retail, services, clinics, restaurants and companies selling to UAE businesses
Free zone company
- 100% foreign ownership and fast setup
- Packages bundle licence, office and visas
- Can qualify for 0% corporate tax on qualifying income
- Suits international trade, software, consulting and holding regional teams
- Selling into the mainland may need a distributor or a mainland licence
Offshore entity
- Holds shares, assets or intellectual property
- Cannot trade inside the UAE or sponsor visas
- Often used alongside an operating company
Branch of a foreign company
Established companies can also open a branch on the mainland or in a free zone. A branch is not a separate legal entity, so the parent company carries its liabilities.
Common questions
Which structure is best for a startup selling online worldwide?
Usually a free zone company, because of full ownership, simple setup and possible tax benefits. If most customers are UAE consumers, compare it with a mainland licence.
Can an offshore company get UAE residence visas?
No. Offshore entities cannot sponsor visas. You need a mainland or free zone company for that.
Rules, fees and processes change. Confirm the details with the relevant authority or a licensed adviser before you commit.
