Most people arrive at our office having already picked a free zone, usually the one with the lowest licence fee they found online. Sometimes it’s the right choice. Often it isn’t, and the difference only shows up a few months later, at the bank or when the first big customer asks for an invoice.
These are the five questions we ask before recommending anything.
1. Who are your customers?
A free zone company can trade freely with businesses abroad and inside its own zone. Selling directly to customers on the UAE mainland, such as a shop, a restaurant or a contract with a Dubai company that needs a local supplier, usually needs a mainland licence or a distributor. If most of your revenue will come from the UAE itself, start with the mainland.
2. Will you bid for government work?
Government departments and many semi-government companies only contract with mainland companies. If that work is part of your plan, the choice is made.
3. How many visas will you need?
Free zones link visas to office space: a flexi-desk usually allows one to three visas, a private office more. A mainland company’s quota depends on its office size too. Count the people you’ll hire in the first two years, not just the first month.
4. What will the bank think?
Banks look at your activity, your substance and where your customers are. A trading company with a flexi-desk in a low-cost zone can find banking harder than the same business with a real office. We look at this before you choose, not after.
5. What does the whole first year cost?
- Licence and registration: from AED 12,900 in a free zone, from AED 16,500 on the mainland.
- Visas: about AED 3,800–4,600 each.
- Office: from nothing extra for a flexi-desk to AED 35,000 or more for a private office.
The cheapest licence can become the most expensive company once visas, office and banking are added.
Our free zones and mainland guide sets out the differences side by side, and the estimator on our company setup page gives a first-year range in seconds. Or book a free consultation and we’ll compare two or three options for your activity, in writing.
