Dubai free zone companies can now access mainland

On 17 March 2025, His Highness Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum in his capacity as Chairman of the Executive Council issued Executive Council Resolution No. 11 of 2025 which applies to the operation of free zones in Dubai (the Resolution). This new Resolution seeks to extend the operation of businesses operating within a free zone in Dubai (excluding financial establishments that operate in the Dubai International Financial Centre). 

The Resolution follows from the D33 Economic Agenda announced in January 2023 in which His Highness Sheikh Mohammed bin Rashid Al Maktoum set out to make Dubai the most important city for business and innovation by 2033.

What does this mean for businesses?

Currently, businesses operating in a free zone in Dubai that want to expand, distribute, and operate in the mainland need to set up an entirely separate entity in mainland Dubai (and pay the costs of doing so). Alternatively, a free zone company could consider working with a mainland company in order to distribute to customers (which also comes with various costs). The new Resolution obviates this need by creating a new licensing and permit arrangement.

The logistics

This new Resolution should make it seamless and convenient for businesses to expand outside of the free zone (so long as they are within the emirate of Dubai). Businesses must obtain permits or licenses from the Dubai Department of Economy and Tourism. The Resolution mentions two types of licenses; one to allow licenses to establish a branch within the mainland, and another to license a branch within the mainland with its headquarters in the free zone (subject to conditions). Businesses should be mindful that they must comply with federal and local regulations whilst operating, and they must keep separate financial records for their activities outside of the free zone.

This new framework offers existing businesses the chance to broaden their market reach, enjoy increased flexibility, boost brand visibility across the emirate, and reassess their business structures in Dubai to identify potential operational efficiencies, cost savings, or growth opportunities through restructuring their corporate licensing arrangements. This is particularly relevant for groups already operating across mainland Dubai and its free zones, businesses established onshore in mainland Dubai whose activities might benefit from relocating to a free zone, and businesses based in free zones that can now access a broader customer base through dual licensing and special activity permits.

Previous dual licensing regimes, such as the Abu Dhabi Department of Economic Development (“ADDED”) Dual Licence Initiative (applicable to all Abu Dhabi free zones), were established prior to the relaxation of foreign ownership restrictions for UAE onshore companies following amendments to the UAE Commercial Companies Law in 2020. The latest Dubai Resolution follows ADDED’s regulations issued in February 2025, permitting firms registered in other UAE emirates (including their free zones) to open branches in Abu Dhabi without requiring physical premises for the first year, reflecting a broader trend towards liberalising the UAE market, removing barriers, and promoting investment and trade.

Looking ahead

Within six months the Dubai Department of Economy and Tourism will issue a list of economic activities that free zone entities may engage in when operating in mainland Dubai. The new Resolution acts as a catalyst for further expansion, reinforcing Dubai’s status as a regional and global business hub and offering abundant opportunities for both existing companies and new market entrants. The ongoing evolution of Dubai’s regulatory environment is paving the way for an increasingly dynamic and interconnected business ecosystem.