Know the Differences Between a Mainland and a Free Zone
If you want to do business in the UAE, it is important to know the differences between the mainland and a free zone. Both types of free zones have their own regulations and requirements. Most mainland companies are involved in import-export activities. Therefore, they do not require an external authority’s approval but may require it if they are engaged in some special services. Nevertheless, the main difference between the two types is that the latter is more regulated and has more flexibility. Consult with a professional Dubai Freezone company setup service provider to know more.
Business Type
Firstly, a mainland company can do any type of business within the country, while a free zone company can only do private commercial assignments. Also, a mainland company can have an unlimited number of visas, while a free zone company cannot. There are a number of benefits to owning a free zone business. The main difference is that you will own 100 percent of the company in a free zone, while in a mainland business, you must hold at least 51 percent local ownership.
Limitations
First, a free zone business is not required by the United Arab Emirates. As a matter of fact, a free zone can be just as viable. However, if you intend to do some sort of re-exporting or import-export activity, you should choose a Mainland structure. Secondly, a free zone can be less restrictive but will require a license. A Mainland company is also likely to have less restrictive regulations.
Lastly, the differences between a Mainland and a Free Zone are essential for the success of your company. While a free zone is more regulated, a mainland company will still have some restrictions that can limit its operations. A free zone is an ideal option for those who value privacy. And while a free zone can be more restrictive, it will also allow for unlimited international activities.
Operation Type
Unlike a free zone, a mainland company is an independent entity with its own set of rules. It can operate both inside and outside of the free zone. A Mainland company cannot operate outside the UAE. Both types have their own advantages. The main benefit of a mainland company is that it has a local presence and can do business with free zones on the other side of the world.
If you are starting a business in the UAE, it is a good idea to use a free zone. It is not necessary to go through a formal process to register a free zone. It is a good idea to have a professional license before starting a business in a free zone. You can work legally in a free zone with no problems. So, if you are interested in Freezone business setup in Dubai, consider your options carefully.
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