AE Formations

Offshore Company Setup in Dubai, UAE | Register a Subsidiary Company in Dubai, UAE

Free Zone Vs. Mainland: How to select business licensor in the UAE

Subsidiary Company Formation in Dubai, UAE | Trade License Renewal Services in Dubai, UAE

Looking to establish your business in the UAE but not sure which licensor to go ahead with? With so many options available, it’s easy to get overwhelmed.

Look no further! We’ll take you through everything you need to know about selecting a licensor in the UAE and help you make the right choice for your business.


Setting up a business is a significant decision that requires careful planning and consideration, especially when selecting a business location. The United Arab Emirates (UAE) is a popular destination for entrepreneurs and investors worldwide due to its favourable business environment, strategic location, and stable economy. However, the UAE has many licensing authorities who have the authority to issue business licenses in their respective jurisdictions. Selecting the right business location and choosing a suitable licensor can be challenging.

In the UAE, there are two broad types of licensors: Free Zones and Mainland. Every kind of licensor has advantages and disadvantages, and selecting the right one depends on your business needs and goals. In this article, we will explore the differences between Free Zone and Mainland licensors and guide on selecting the right one for your business.

Free Zone Licensors:

Free Zones are designated areas in the UAE where businesses can operate with 100% foreign ownership and tax exemptions. Free Zone licensors are responsible for issuing licenses to companies operating within their jurisdiction. Free Zones are attractive to foreign investors as they offer many benefits such as simplified procedures, fast processing times, and access to world-class infrastructure apart from tax benefits.

Advantages of Free Zone Licensors:

Disadvantages of Free Zone Licensors:

Mainland Licensors:

Mainland companies operate under the jurisdiction of the UAE government. Each of the UAE’s seven emirates(states) has its mainland licensing authorities. Mainland licensors are responsible for issuing licenses to companies operating within their jurisdiction, which is within the emirate, excluding free zones in the emirate. Mainland companies have access to the local market and are open to any activity businesses need to license for. 

Advantages of Mainland Licensors:

Disadvantages of Mainland Licensors:

Choosing the Right Licensor: Free Zone Vs Mainland

When selecting a licensor, it is crucial to consider your business needs and goals. Suppose your company is focused on international trade and does not require access to the local market. In that case, a Free Zone licensor may be your best option. However, if you need access to the local market, a Mainland licensor may be the better choice. Target market is the most crucial consideration while deciding between Mainland Vs Free Zone. 

It is important to note that some business activities, such as banking, insurance, and legal services, are restricted to Mainland companies. If your business falls under these categories, you must choose a Mainland licensor. 

Factors to Consider When Choosing Between Free Zone and Mainland

  • Nature of the business 
  • Target market 
  • Type of industry 
  • Legal structure 
  • Business goals and objectives 


Selecting the right business location and licensor is critical to the success of your business in the UAE, as it will have long-term repercussions on cost, operations and taxes. Free Zone and Mainland licensors offer advantages and disadvantages, and choosing the right one depends on your business needs and goals. By carefully considering your options and conducting thorough research, you can make an informed decision that will set your business up for success. 

You can use our decision-making tool to decide which is the best-suited licensing authority in the UAE. The tool intends to help entrepreneurs select between all licensing authorities in the UAE, including Mainland and Free Zones. 



Name of the free zone 

Abu Dhabi 

Abu Dhabi Airport Free Zone (ADAFZ) 

Abu Dhabi 

Abu Dhabi Global Markets (ADGM) 

Abu Dhabi 

Higher Corporation for Specialized Economic Zones (ZonesCorp) 

Abu Dhabi 

Khalifa Industrial Zone Abu Dhabi (KIZAD) 

Abu Dhabi 

Masdar City Free Zone 


Dubai Airport Free Zone (DAFZA) 


Dubai Cars and Automotive Zone (DUCAMZ) 


Dubai Design District (d3) 


Dubai Gold and Diamond Park 


Dubai Healthcare City (DHCC) 


Dubai International Academic City (DIAC) 


Dubai International Financial Centre (DIFC) 


Dubai Internet City (DIC) 


Dubai Knowledge Park (DKP) 


Dubai Media City (DMC) 


Dubai Multi Commodities Centre (DMCC) 


Dubai Silicon Oasis (DSO) 


Dubai Studio City (DSC) 


Dubai World Trade Centre (DWTC) 


Jebel Ali Free Zone (JAFZA) 


Hamriyah Free Zone Authority (HFZA) 


Sharjah Airport International Free Zone (SAIF-Zone) 


Sharjah Media City (Shams) 


Fujairah Free Zone 


Fujairah Creative City  

Ras Al Khaimah 

Ras Al Khaimah Economic Zone (RAKEZ) 

Ras Al Khaimah 

Ras Al Khaimah Free Trade Zone (RAK FTZ) 


Ajman Free Zone Authority (AFZA) 

Umm Al Quwain 

Umm Al Quwain Free Trade Zone (UAQ FTZ) 


6. How many mainland licensing authorities are in the UAE? List them. 

There are seven mainland licensing authorities in the UAE, including  

  • Department of Economic Development (DED) in Dubai,  
  • Abu Dhabi Department of Economic Development (ADDED),  
  • Sharjah Economic Development Department (SEDD). 


Shopping Basket