If you’re a business owner or entrepreneur looking to expand your operations in the UAE, this is an exciting development that you won’t want to miss. In Dubai, a dual license allows you to operate in both a free zone and the mainland, giving you access to a wider customer base and more business opportunities.
Until recently, obtaining a dual license in Dubai was not possible. However, the government has recently introduced new regulations that allow certain free zones to issue dual licenses. This means that businesses can now establish themselves in a free zone and also operate outside of it, without the need for a separate mainland license.
So, if you’re considering expanding your business, we will guide you through the process of obtaining a dual license in UAE or Dubai. It is essential for you to understand the eligibility criteria, the necessary documentation, and the steps involved in the application process.
What is a Dual License in Dubai?
A dual license in Dubai is a special type of business license that allows a company operating within a free zone to also have access to the local mainland market. This essentially grants the business the benefits of both worlds.
Free zone benefits
- 100% foreign ownership: You can own your business entirely without needing a local partner.
- Tax exemptions: You are typically exempt from several taxes including income tax for a set period.
- Simplified regulations: Free zones often have simpler and faster business setup and operational procedures.
- Repatriation of profits: You can freely repatriate all your profits back to your home country.
- Currency freedom: You can conduct transactions in any currency.
Mainland access
- Directly trade with local businesses: You can sell your goods and services directly within the UAE market, without restrictions.
- No additional office space required: Unlike some dual license systems, you don’t necessarily need a separate office in the mainland.
- Hire local staff: You can legally hire and sponsor employees for mainland operations.
- Wider range of business activities: Access opportunities not available in free zones.
However, not all free zones offer dual licenses in Dubai. Currently, only a few specific free zones in Dubai, like DAFZA (Dubai Airport Free Zone) and DIFC (Dubai International Financial Centre), have partnered with the Department of Economic Development (DED) to offer dual licensing options.
Also, you’ll need both a free zone license and a mainland license, each with its own fees.
Types of Dual Licenses in UAE
When it comes to dual licenses in Dubai, there isn’t a single type, but rather different options depending on the specific needs of your business and the chosen free zone.
Here’s a breakdown of some common types:
1. General Trade License
This allows you to trade in a wide range of goods and services, both within the free zone and on the mainland. It’s the most flexible option, but specific activities might still be restricted.
2. Professional License
This caters to professionals like consultants, lawyers, or doctors, allowing them to offer services in both markets.
3. E-commerce License
Ideal for businesses primarily operating online, enabling you to sell products and services through e-commerce platforms to both local and international customers.
4. Specific Industry Licenses
Some free zones offer specialized licenses for specific industries like media, technology, or healthcare, granting access to relevant markets within the free zone and mainland.
Remember, the availability of specific types and their exact details may vary depending on your chosen free zone and business activity.
How to Get a Dual License in Dubai
Acquiring a dual license in Dubai offers distinct advantages for businesses seeking access to both the free zone and mainland markets. Here’s a step-by-step guide to navigate the process:
Step 1: Decide on your target Free Zone
Currently, only limited Free Zones in Dubai offer dual licensing including the Dubai Airport Free Zone (DAFZA) and Dubai International Financial Centre (DIFC). Research each Free Zone, considering factors like industry focus, regulations, and costs.
Step 2: Choose your legal entity and trade name
Determine the optimal business structure such as LLC or branch office. Choose a distinct and relevant trade name for your company.
Step 3: Company Registration at Dubai Free Zone
Apply for your company license through the chosen Free Zone authority. Provide required documents and fulfill legal formalities and obtain the initial Free Zone company license.
Step 4: Apply for a DED License
Submit an application for a mainland license to the DED through the chosen Free Zone authority. Provide additional documents as requested, including specific approvals and a Free Zone license. Pay associated fees and comply with DED regulations.
Step 5: Await Approval and Issuance
Receive your DED license after approval. Choose and secure an office space (depending on regulations). Process visas and sponsorships for any mainland employees. Start operations in both the Free Zone and mainland markets.
Benefits of Dual Licensing in Dubai
Dual licensing in a free zone in Dubai can offer several benefits to businesses:
1. Access to both the free zone and mainland markets
This allows you to tap into the vast potential of both the free zone’s streamlined business environment and the mainland’s wider customer base and local partnerships.
2. No additional office space required
In some cases, you may not need to have a separate office space on the mainland to operate with a dual license. This can save you a significant amount of money on rent and other overhead costs.
3. Hire local staff
You can legally hire and sponsor employees for mainland operations. This is not always the case with a free zone license only.
4. Increased credibility
Having a dual license can make your business appear more credible and trustworthy to potential customers and partners.
5. Streamlined business expansion
If you already have a free zone company, obtaining a dual license can be a faster and more cost-effective way to expand your operations into the mainland market compared to setting up a new entity.
6. Diversification of revenue streams
By operating in both the free zone and the local market, a business can diversify its revenue streams. This can be particularly advantageous in times of economic changes or shifts in market demand.
What are the Restrictions on Dual Licenses?
While dual licensing in Dubai offers numerous benefits, there are also some limitations and restrictions to be aware of before making your decision. Here are some key points to consider:
- Currently, only a few free zones in Dubai offer dual licensing.
- Not all business activities are eligible for dual licensing. Each free zone has its own list of approved activities, and some activities may be restricted to the free zone itself or the mainland market.
- While you don’t need a separate mainland office in some cases, you may pay additional fees for the dual license.
- Depending on the free zone and regulations, you may need a larger office space within the free zone to accommodate mainland staff.
- While free zones offer tax benefits, dual licensing may involve additional tax considerations for mainland operations.
- In some cases, employees working in your mainland operations may need to be employed through the free zone company and hold free zone resident visas.
It’s crucial to carefully research the specific conditions and regulations pertaining to dual licensing in the chosen free zone and for your specific business activity. Consider seeking professional assistance from a reputed business setup consultants in Dubai such as Shuraa Business Setup.
Your Seamless Dubai Journey Starts with Shuraa
Undoubtedly, obtaining a dual license in Dubai can open up a world of opportunities for businesses. By having two licenses, companies can tap into different markets and cater to a wider range of customers.
While the process of obtaining a dual license in UAE may seem daunting, seeking professional advice can make it much smoother and more efficient.
Leading business setup experts like Shuraa have the knowledge and expertise to guide businesses through the entire process. From choosing the right free zone and activity to securing licenses, securing office space, and managing visas, our comprehensive services ensure a smooth and successful journey.
Don’t settle for a single market when you can conquer two. With Shuraa’s expertise, unleash the full potential of your business with a Dubai dual license. Contact us today at +971 4 4081900, via WhatsApp at +971 50 7775554, or by emailing [email protected]. Let’s turn your vision into reality.
