The new resolution is aimed at easing business expansion within Dubai. Photo: DMCC
The new resolution is aimed at easing business expansion within Dubai. Photo: DMCC
The new resolution is aimed at easing business expansion within Dubai. Photo: DMCC
The new resolution is aimed at easing business expansion within Dubai. Photo: DMCC

Dubai issues new regulation for free zone companies


Aarti Nagraj
  • English
  • Arabic

Dubai has issued a new resolution regulating the operations of free zone companies aimed at making it easier for them to expand operations within the emirate.

The resolution was issued by Sheikh Hamdan bin Mohammed, Crown Prince of Dubai, Deputy Prime Minister and Minister of Defence, in his role as chairman of the Executive Council of Dubai on Monday.

It states that any company or institution licensed by a free zone relevant authority may operate outside the free zone and within Dubai, as long as it obtains the necessary licenses or permits from the Dubai Department of Economy and Tourism (DET). The resolution does not apply to financial institutions licensed to operate within the Dubai International Financial Centre.

Establishments must observe the applicable federal and local regulations related to their activities and maintain separate financial records for their operations conducted outside the free zone, separate from those within the free zone, the Dubai Media Office said on Monday.

Also, if the companies wish to operate outside Dubai, they must secure the required licences and permits from the relevant authorities, it said.

“This latest resolution marks a significant advancement in enhancing the business landscape, by enabling free zone businesses to effortlessly expand their operations beyond the free zones into mainland Dubai,” it added.

According to the resolution, the DET is authorised to issue a licence to a company to establish a branch within the emirate or a licence for a branch with its headquarters in the free zone. These licences are valid for one year and can be renewed, the statement said. Permits may also be issued for specific activities within the emirate.

The DET, in co-ordination with the licensing authority, is required to issue a list of economic activities that companies can conduct in Dubai within six months.

The resolution also outlines the requirements for obtaining a licence, the procedures for issuing activity permits, and the conditions for employing the company's workforce.

Any company licensed to operate in Dubai under this resolution is subject to inspection, the statement added.

The initiative is in line with the city's ambitious D33 agenda, under which it aims to double the size of its economy to Dh32 trillion ($8.71 trillion) over the next decade and establish the emirate among the top three global cities. The plan aims to support 30 private companies in their push to become so-called unicorns – start-ups worth more than $1 billion.

The D33 agenda also aims to make Dubai a global digital economy leader, the fastest-growing and most attractive global business centre, and a hub for sustainability and economic diversification by 2033.

In the first nine months of last year, Dubai's economy grew by 3.1 per cent, reaching Dh339.4 billion, with growth largely driven by strides in several sectors including the wholesale and retail trade, transport and storage and financial and insurance activities.

Dubai was also ranked as the world’s top destination for greenfield foreign direct investment (FDI) projects for the fourth consecutive year, last year.

Dubai attracted 1,117 greenfield FDI projects worth more than Dh52.3 billion last year, a 33.2 per cent increase from 2023, the Dubai Media Office this month, quoting the Financial Times' fDi Markets data.

In terms of the greenfield FDI value, this was the highest recorded by the emirate in a single year since 2020, and in project numbers, it was the highest in its history.

"The new resolution is a significant step forward in making business operations more seamless in Dubai," said Paul Bryson, managing director of Virtuzone, which helps in company formation.

"While companies have previously been able to establish mainland branches from free zones, restrictions on certain commercial activities, particularly those involving physical goods trading, have posed challenges.

"The natural next step would be to enable corporate migration between the various jurisdictions within the UAE, further enhancing business flexibility and economic growth," he added.

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Updated: March 18, 2025, 10:40 AM`