In a Major policy shift, His Highness Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai, Chairman of the Executive Council of Dubai has introduced Executive Council Resolution No. (11) of 2025, allowing businesses established in free zones to expand their operations into the mainland. This move aims to foster economic integration and provide companies with greater flexibility and market access.

What Does This Mean for Free Zone Companies?

Previously, companies operating within Dubai’s free zones were restricted to conducting business solely within their designated zones or internationally. The new resolution removes these limitations, enabling free zone companies to establish a presence in the mainland by obtaining the necessary licenses and permits from the Dubai Department of Economy and Tourism (DET) .

Key Features of the New Resolution

• Expansion Opportunities: Free zone companies can now open branches in mainland Dubai, allowing them to serve a broader customer base and tap into new market segments .
• Licensing Requirements: To operate in the mainland, companies must secure licenses from the DET. These licenses are valid for one year and can be renewed annually .
• Compliance Obligations: Businesses must adhere to all applicable UAE federal and local laws, including maintaining separate financial records for their mainland operations .
• Sector Exclusions: Certain sectors, such as financial institutions licensed within the Dubai International Financial Centre (DIFC), are excluded from this resolution and will continue to follow their existing regulatory frameworks .

Benefits of Operating in the Mainland

• Broader Market Access: Establishing a presence in the mainland allows companies to reach a wider customer base, including government entities and large corporations.
• Enhanced Credibility: Operating in the mainland can enhance a company’s credibility and visibility in the local market.
• Operational Flexibility: Companies can leverage the benefits of both free zone and mainland operations to optimize their business strategies.

Steps to Expand into the Mainland

1. Determine Business Eligibility: Ensure that your business activity is permitted under the new resolution.
2. Apply for Mainland License: Submit an application to the DET for a mainland branch license or specific activity permit.
3. Secure Approvals: Obtain any necessary approvals from relevant authorities, depending on the nature of your business.
4. Maintain Compliance: Adhere to all regulatory requirements, including maintaining separate financial records and complying with labor laws.
5. Renew Licenses Annually: Ensure timely renewal of licenses to maintain uninterrupted operations.

Dubai’s decision to allow free zone companies to operate in the mainland marks a significant step towards economic integration and offers businesses enhanced opportunities for growth and expansion. By understanding and complying with the new regulations, companies can effectively navigate this transition and capitalize on the expanded market access.