Setting up a business in the UAE offers incredible growth potential—but your success depends heavily on choosing the right legal structure. The three most common options for foreign investors are Mainland, Freezone, and Offshore. Each serves a distinct purpose and comes with its own set of advantages, limitations, and regulatory frameworks.
In this guide, we break down the differences so you can make an informed decision based on your business goals.
1. Mainland Company (Onshore License)
Best for: Businesses targeting the UAE domestic market
Key Features:
Can operate anywhere in the UAE
Eligible for government contracts
Access to local markets and broader visa quotas
100% foreign ownership allowed in most sectors (post-2021 reforms)
Considerations:
Requires approval from the Department of Economic Development (DED)
Office space is mandatory
Subject to UAE corporate tax (from June 2023)
✅ Ideal for service providers, retail, construction, logistics, or B2B businesses targeting UAE clients.
2. Freezone Company
Best for: International trade, e-commerce, tech startups, consultants
Key Features:
100% foreign ownership
Corporate tax exemptions (if no onshore activity)
Easy licensing and setup process
Access to modern infrastructure in specific industry zones (e.g., tech, media, healthcare)
Considerations:
Cannot directly trade with the UAE mainland without a local distributor
Limited scope for expanding outside the Freezone without approvals
Each Freezone has its own governing body, laws, and rules
✅ Perfect for startups, digital businesses, import-export traders, and remote-friendly operations.
3. Offshore Company
Best for: Asset protection, holding companies, global business without UAE operations
Key Features:
No physical office required in UAE
Full foreign ownership
Tax neutral (no income/corporate tax)
No public disclosure of directors/shareholders
Considerations:
Cannot operate or issue visas within the UAE
Not eligible for a UAE tax residency certificate
Mainly for international transactions, holding IP, and real estate investments
✅ Suitable for holding companies, international investors, and those needing a UAE-registered entity for global operations.
Trustword’s Recommendation
Before making your decision, consider:
Where your customers are located
Do you need visas or office space?
Will you trade within the UAE or globally?
Are you planning to raise investment or scale quickly?
At Trustword, we offer tailored consultation to help you select the optimal structure—and then handle all paperwork, approvals, and compliance from A to Z.
Start Smart. Scale Fast. Stay Compliant.
📞 Book a free consultation with Trustword today.
📧 info@trustword.ae | 🌐 www.trustword.ae
I look forward to seeing how these developments will improve service levels and customer satisfaction in the freight industry!