Key takeaways
- A foreign national can own 100% of most UAE mainland companies, with no local partner and no extra capital or fees required, under Federal Decree-Law No. 26 of 2020 amending the Commercial Companies Law.
- Free zone companies have always allowed full foreign ownership; the difference from mainland is market access, not ownership percentage.
- A short list of activities, mostly security, defence, fisheries, banking, currency printing, telecoms and religious services, stays outside the 100% rule and needs a different ownership structure.
- Mainland registration runs through ten steps set by the Ministry of Economy and Tourism, from choosing a business activity to registering with the Chamber of Commerce; free zone registration is a shorter version run by the free zone authority.
- Cost and timeline depend on the emirate, free zone, activity and visa count, so treat any fixed AED figure online as a starting estimate, not a quote.
What does setting up a UAE company as a foreigner actually involve?
Setting up a UAE company as a foreigner means choosing a jurisdiction (mainland or one of over 40 free zones), a business activity and a legal structure, then registering that structure with the licensing authority. The result is a trade licence, which lets you invoice, sponsor visas and open a bank account. For most activities, a foreign national can complete the whole process without a UAE national as a partner.
Can foreigners own 100% of a UAE company?
Yes, for most commercial and industrial activities. Federal Decree-Law No. 26 of 2020, amending Federal Law No. 2 of 2015 on Commercial Companies, removed the requirement for a UAE national to hold a majority stake in mainland companies, effective from June 2021. Dubai Economy confirms 100% ownership for more than 1,000 commercial and industrial activities, with no extra fees, guarantees or capital beyond normal licensing costs. Abu Dhabi's Department of Economic Development lists 1,105 activities open to full foreign ownership.
A narrow band of activities stays outside this because the UAE Cabinet classifies them as having strategic impact. Dubai Economy has said this covers seven sectors; legal commentary on the decree lists these as security and defence, fisheries, certain financial institutions, currency printing, telecommunications, Hajj and Umrah services, and Quran memorisation centres. Commercial agencies are also excluded, since they're governed separately under the Commercial Agencies Law. An activity in one of these categories needs a different structure, such as a local partner or a branch arrangement, and the rules differ by emirate.
Mainland or free zone: which should a foreign owner choose?
Neither is universally better; it depends on who you plan to sell to. Free zones have offered 100% foreign ownership since long before the 2021 mainland reform, so ownership isn't the deciding factor. The practical differences are market access, office requirements and cost.
| Factor | Mainland | Free zone |
|---|---|---|
| Foreign ownership | Up to 100% for most activities | 100%, standard since inception |
| Trading with UAE mainland clients | Direct, no restriction | Usually needs a mainland branch, distributor or dual licence |
| Licensing authority | Emirate's Department of Economic Development (or equivalent) | The individual free zone authority |
| Office requirement | Physical premises generally required | Flexi-desk or shared office often accepted |
| Government and public-sector contracts | Eligible directly | Generally not, without a mainland presence |
| Company formation cost | Varies by emirate and activity | Varies by free zone and package |
Mainland usually fits best if most clients are UAE government entities or mainland companies, or you want a shopfront. A free zone tends to suit a digital, cross-border or B2B business that doesn't need a specific mainland location, and often means lower setup and renewal costs.
What are the steps to register a company in the UAE?
The Ministry of Economy and Tourism sets out mainland registration as ten steps. A free zone runs a shorter version of the same logic, entirely through the free zone authority.
- Decide the business activity: commercial, professional, industrial, tourism, agricultural or occupational.
- Choose the legal structure: limited liability company, sole establishment, civil company or branch of a foreign or GCC company.
- Reserve a trade name; it must carry a suffix matching the structure (for example, LLC) and can't use a ruler's name, a government body's name or offensive language.
- Apply for initial approval, the authority's no-objection to proceed, not the licence itself.
- Draft the Memorandum of Association for a company, or a Local Service Agent agreement for a sole establishment.
- Secure business premises that comply with zoning rules for the activity and emirate.
- Obtain any extra approvals the activity needs, from bodies such as the Ministry of Interior, Ministry of Justice or a health authority.
- Submit the full document set: initial approval, tenancy contract or flexi-desk agreement, and association documents.
- Pay the licensing fees and collect the trade licence.
- Register with the emirate's Chamber of Commerce, a mandatory final step for mainland companies.
Mainland licensing can be completed in as little as four working days once documents are in order, and some activities are licensed within minutes through the UAE's Basher platform, per the Ministry of Economy and Tourism. Free zones generally quote a similar range once documents are complete.
What documents does a foreign owner need?
The core document set is broadly the same across mainland and free zone applications, though each authority has its own checklist and some ask for more.
- Passport copies of all shareholders and the appointed manager or director.
- Passport-size photographs on a white background.
- A completed application form from the licensing authority or free zone.
- Proposed trade names, ranked by preference.
- A No Objection Certificate from a current UAE sponsor, if a shareholder holds a residence visa tied to an employer.
- A brief business plan, for some free zones and regulated activities.
- Board resolution and power of attorney, for a corporate shareholder.
- Proof of address or a bank reference letter, for higher-value structures.
Applying from outside the UAE, most of this runs remotely by power of attorney; you'll typically only need to appear once, for final signing and Emirates ID biometrics if also taking a residence visa.
How long does UAE company formation take, and what does it cost?
Formation itself, from document submission to licence issuance, typically takes a few days to a few weeks, depending on how quickly documents are ready and whether the activity needs extra approvals. The Ministry of Economy and Tourism's four-working-day benchmark applies once paperwork is complete; outside approvals add time on top.
Cost depends on the emirate or free zone, the activity, the number of visas, whether office space is needed, and optional services such as translation or a local service agent. Free zones publish package pricing on their own sites, and Invest in Dubai's portal generates a mainland cost estimate by activity. Treat any blanket "from AED X" figure on a marketing site as a starting point, not a quote.
100%: the share of a UAE mainland company a foreign investor can own for the large majority of commercial and industrial activities, with no extra capital, guarantee or fee required beyond standard licensing costs. Source: Federal Decree-Law No. 26 of 2020 amending Federal Law No. 2 of 2015 on Commercial Companies; Dubai Economy, checked 28 September 2026.
What most guides don't tell you
- The activities list isn't one national list. Abu Dhabi and Dubai each publish their own (1,105 and over 1,000 respectively), and excluded activities are set the same way, per emirate. An activity open in one emirate can still sit outside it in another, so check the list for the emirate you're registering in first.
- Trade name rejection is a common early delay. Names implying government affiliation, a ruler's name, or inappropriate language get bounced, and resubmitting resets part of the timeline.
- Fix the legal structure before reserving the trade name; the name needs a suffix matching that structure (LLC, for instance). Change structure after reserving a name, and the reservation usually has to be redone.
- A free zone licence doesn't automatically let you invoice mainland UAE clients directly. If selling to government entities or mainland companies from day one is part of the plan, confirm the dual-licence or branch route with the free zone authority first.
Once the company is formed, licence renewal and corporate tax registration deadlines start immediately. If you'd rather not track these by hand, the free UAE compliance calendar lists them for your company.
Which deadlines apply to your new UAE company?
Every new UAE company inherits dates in its first year: licence renewal, corporate tax registration, VAT registration if turnover crosses the threshold, and visa renewals, plus any free zone or activity-specific ones. The free UAE compliance calendar turns these into a personalised list, built from a few questions, delivered as a PDF and a calendar file.
Frequently asked questions
Mainland vs free zone company in Dubai, which one is better for my business? Neither is better in general; it depends on your customers. Choose mainland to sell directly to UAE government bodies or mainland companies without restriction, and free zone for a cross-border or digital business that doesn't need mainland access.
What is the cheapest free zone to set up a company in the UAE in 2026? There's no verified single answer, because packages change often and depend on activity, visa count and office type. Compare current published packages on each free zone's own website rather than a "cheapest" ranking from a third-party site.
How much does it cost to open a company in Dubai, all in, including visas? It depends on the jurisdiction, activity, visa count and office requirement, so there's no reliable blanket figure. Invest in Dubai's portal generates a cost estimate by activity, and free zones publish their own package pricing.
Can I own 100% of a mainland company in the UAE now? Yes, for the large majority of commercial and industrial activities, following Federal Decree-Law No. 26 of 2020. A short list of strategic-impact activities and commercial agencies stays outside this.
Which business activities still need a local Emirati partner or agent? Activities the UAE Cabinet classifies as having strategic impact, which Dubai Economy has said covers seven sectors including security, defence, fisheries, certain financial institutions, currency printing, telecommunications and religious services, plus commercial agencies, regulated separately. Confirm the exact list against your specific activity and emirate.
About Qawi · Qawi is a corporate services firm licensed in the Sharjah Media City (SHAMS) free zone, handling company formation, visas and PRO, bookkeeping, VAT and corporate tax for UAE businesses. Guides are researched from FTA, Ministry of Finance and free zone sources. Qawi on LinkedIn
Sources
- Full foreign ownership of commercial companies, The Official Portal of the UAE Government
- Establishing Businesses, Ministry of Economy and Tourism
- Dubai Economy clarifies full ownership procedures for foreign investors, UAE Government Media Office
- UAE Announces Activities Open to Foreign Ownership, DWF (legal commentary on Federal Decree-Law No. 26 of 2020)
Last checked: 28 September 2026. This is general information, not tax or legal advice for your specific situation.