How to open a company in the UAE

Last verified: 2026-10-06

Summary

A person opening a company in the UAE first chooses between two routes: the mainland, licensed by the economic department of the relevant emirate, or a free zone, licensed by the free zone’s own authority. The steps, the available legal forms and the markets a company may sell into differ between the two routes. This guide describes the overall process as set out on the official UAE government portal (u.ae) and the Dubai government portal (dubai.ae).

Mainland or free zone

Mainland. According to u.ae, mainland companies are registered and licensed by the economic development department of the emirate where they are based. In Dubai this is the Department of Economy & Tourism (DET). u.ae lists these authorities by emirate:

• Abu Dhabi: Department of Economic Development
• Dubai: Department of Economy & Tourism
• Sharjah, Ajman, Umm Al Quwain and Ras Al Khaimah: the Economic Development Department or Department of Economic Development of each emirate
• Fujairah: Fujairah Municipality

Free zone. u.ae states that a company applies online through the website of the respective free zone authority. u.ae lists the free zones of each emirate and the authorities regulating them, and states that not every free zone registers every company type.

Selling into the mainland. u.ae states that direct sales in the mainland are generally not permitted for a free zone company unless it obtains the required mainland licences or approvals. It may instead work through a licensed mainland distributor, or set up a mainland branch or company.

Foreign ownership. u.ae states that companies may be established with full foreign ownership in accordance with the lists published by local authorities, except for sectors deemed Activities with Strategic Impact, where full ownership is subject to the approval of the regulatory authorities overseeing those sectors.

The usual steps

Mainland route (nine steps on u.ae)

1. Identify the business activity (u.ae mentions more than 2,000 activities).
2. Select a legal form, such as a limited liability company.
3. Apply for a trade licence.
4. Register the trade name.
5. Obtain initial approval, which confirms there is no objection to the business being established but does not allow the activity to start.
6. Sign the Memorandum of Association and, where applicable, a Local Service Agent agreement.
7. Select a business location that meets the economic department’s requirements.
8. Obtain any additional government approvals the activity needs.
9. Collect the business licence.

The separate guide on mainland setup steps covers these in more detail.

Free zone route (four steps on u.ae)

1. Select the sector and a free zone that supports it.
2. Determine the legal entity type.
3. Choose and register a trade name, checking availability with the free zone authority or the Department of Economic Development.
4. Apply for the business licence online through the free zone authority; u.ae states that after review and approval the licence is issued within 14 working days.

Bodies involved

• The economic department of the emirate (mainland) or the free zone authority.
• The General Directorate of Residency and Foreigners’ Affairs, whose approval foreign investors need before initial approval on the mainland, according to u.ae.
• Sector regulators for regulated activities, for example the Central Bank of the UAE for financial institutions and the Securities and Commodities Authority for share broking, as listed on u.ae.
• In some free zone sectors, additional entities such as the National Media Authority or Dubai Municipality, according to u.ae.

What it costs

Fees depend on the route, the free zone or emirate, the licence and the activity. This guide does not quote figures; use the comparison tool on this site to compare setup costs and rules side by side, and confirm current fees with the licensing authority.

Common pitfalls

• Assuming a free zone licence permits direct trading on the mainland; u.ae says mainland sales generally need the required mainland licences or approvals.
• Treating initial approval as permission to trade; u.ae states it does not authorise the activity.
• Not checking whether the chosen activity needs approval from another government body before applying.
• Choosing a trade name that does not follow the naming rules, for example one that omits the legal form.
• Assuming every free zone offers every legal form.

Check the authority

Figures, procedures and rules change. Check the current requirements with the relevant licensing authority, the free zone authority, or the u.ae portal before acting.

Figures and details in this guide are as stated on the cited official pages as of 6 October 2026.

Sources

• https://u.ae/en/information-and-services/business/Doing-business/doing-business-on-the-mainland/steps-to-start-a-business-on-the-mainland
• https://u.ae/en/information-and-services/business/Doing-business/doing-business-in-free-zones/starting-a-business-in-a-free-zone
• https://u.ae/en/information-and-services/business/Doing-business/doing-business-in-free-zones/running-a-business-in-a-free-zone-
• https://u.ae/en/information-and-services/finance-and-investment/Investment/foreign-direct-investment
• https://www.dubai.ae/starting-a-business

This information is general; rules and fees can change. Check current details with the relevant authority.

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