The Dubai Business Registration and Licensing Corporation (DBLC), part of the Dubai Department of Economy and Tourism (DET), in collaboration with the Dubai Free Zone Council, has launched the Free Zone Mainland Operating Permit, a major regulatory reform allowing free zone companies to operate directly within Dubai’s mainland through a structured permit system. Introduced under Dubai Executive Council Decision No. 11 of 2025, the initiative enhances business flexibility, reduces operational barriers, and aligns with the Dubai Economic Agenda (D33)—which aims to double the emirate’s economy by 2033 and position it among the world’s top three business destinations.
Eligible free zone companies holding a Dubai Unified Licence (DUL) can apply digitally. The process is entirely online, offering efficiency and accessibility for SMEs, start-ups, and international firms seeking mainland access without the administrative and cost burden of establishing a separate mainland entity.
Licensing Options under the Resolution
The Resolution introduces three distinct mechanisms through which free zone establishments can conduct activities within Dubai’s mainland:
- Mainland Branch Licence – allowing the free zone company to set up a branch under DET supervision within Dubai.
- Free Zone-Based Branch Licence – enabling an existing free zone branch to carry out authorised activities in the mainland.
- Temporary Permit – a six-month authorisation ideal for short-term projects, market testing, or limited operations.
Each option requires prior approval from the relevant Free Zone Licensing Authority, and where necessary, from government regulators overseeing the specific business activity. Licences are valid for one year, renewable under the same conditions, while temporary permits maintain a six-month validity.
In its first phase, the permit covers non-regulated activities such as technology, consultancy, design, professional services, and trading. There are plans to expand the framework to regulated sectors in the future, further broadening the scope for cross-jurisdictional business.
The Resolution further mandates that companies maintain separate financial records for mainland and free zone operations, ensuring transparency, accountability, and compliance with UAE Corporate Tax Law, under which only mainland-derived income is taxed at 9%.
What this means for Free Zone Companies
The permit framework removes one of the biggest limitations on free zone businesses — the inability to trade directly with mainland clients. Companies can now:
- Engage in mainland trading without setting up a separate entity.
- Compete for government tenders and contracts, traditionally reserved for mainland licenses.
- Integrate into local supply chains and reach new customer segments.
- Deploy existing staff for mainland activities, avoiding additional visa or sponsorship costs.
For many SMEs and professional service providers, this reform represents a practical bridge between the free zone and mainland markets — enabling gradual expansion with minimal cost and regulatory friction.
Policy context and broader implications
This development marks a strategic shift from Dubai’s earlier fragmented framework, which required free zone companies to operate through local agents or distributors. The new system provides a unified, transparent mechanism that harmonises the relationship between mainland and Free Zone jurisdictions. It promotes fair competition, simplifies compliance, and fosters a level playing field for all investors.
Beyond its procedural advantages, the reform reflects Dubai’s maturing economic vision — one that values integration, innovation, and inclusivity. By enabling businesses to operate seamlessly across jurisdictions, Dubai strengthens its reputation as a globally adaptive and investment-friendly economy, where regulatory clarity supports long-term growth and sustainable diversification.
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