Want to Move Your Freezone Company to Mainland Dubai? Here’s How That Actually Works

Want to Move Your Freezone Company to Mainland Dubai? Here’s How That Actually Works

The question usually comes up at a specific moment: a client asks you to invoice from a mainland entity, a government tender requires a mainland licence, or you want a retail location outside your free zone. If you are looking at moving your free zone company to mainland Dubai, the good news is that there are now three routes rather than one, and the most common assumption — that you have to shut down and start again — is no longer true in most cases.

Why Businesses Move From Freezone to Mainland

Free zones do a specific job well: full foreign ownership, streamlined setup, sector clustering, and favourable tax treatment on qualifying income. The limitations only become visible once a business grows past a certain point.

• Trading directly with mainland customers. A free zone company without mainland authorisation cannot sell directly into the local UAE market and has historically needed a distributor or agent, which costs margin and control.
• Government and semi-government contracts. Many public sector tenders require a mainland licence, which shuts an unauthorised free zone entity out of a substantial part of the UAE economy.
• Physical retail or premises outside the zone. Opening a shop, showroom, clinic or office in mainland Dubai requires appropriate mainland licensing.
• Client and partner expectations. Some mainland corporates prefer or require contracting with a mainland-licensed supplier.
• Broader activity scope. Certain activities are simply not available under a given free zone’s licence list.

Is It Actually Possible to Convert a Freezone Licence to Mainland?

You cannot convert a free zone licence into a mainland licence in the literal sense — the two are issued by different authorities under different legal frameworks, and the free zone entity cannot simply be re-registered as a mainland one. But since March 2025 you no longer need to. Under Dubai Executive Council Resolution No. (11) of 2025, a free zone company can be authorised by the Department of Economy and Tourism to conduct activities in mainland Dubai without forming a second legal entity.

That gives you three practical options, and choosing the right one is the whole decision.

 

Route	What it involves	Best suited to
DET branch licence under Resolution 11	Your free zone entity is authorised to operate on the mainland through a branch licensed by DET. No new legal entity. Requires an NOC from your free zone authority and DET approval, with an annual government fee	Ongoing mainland trading while keeping the free zone entity, visas and bank account intact
Temporary DET permit	A permit valid for up to six months to carry out specific activities outside the free zone	Testing the mainland market, or delivering a single defined contract
New mainland entity	A separate mainland company is formed under DET, and the free zone entity is either wound down or kept running alongside	A genuine structural move, or where the activity or ownership requirements do not fit the branch route

 

The resolution also required free zone companies that were already operating on the mainland without authorisation to regularise their position within a defined window. If that describes your business, treat it as a compliance matter to resolve rather than an option to weigh.

The Difference Between Converting and Starting a New Mainland Company

This is where most of the confusion sits, and the distinction has real consequences for your visas, contracts and bank account.

Under the branch route, the mainland branch has no separate legal personality. It is the same company operating in a wider territory. Your corporate identity, your trade name, your existing contracts and your banking relationship continue, and the branch is treated as part of the parent for legal purposes. You will need to keep separate financial records for the mainland activity, and mainland-source income falls under the standard corporate tax treatment rather than any free zone qualifying income relief.

Under the new entity route, you are creating a genuinely different company with its own licence, its own trade name registration, its own bank account and its own visa quota. Contracts do not transfer automatically — they must be novated or reissued. Employees do not transfer automatically — their visas are tied to the sponsoring entity. This is a migration project, not a licence amendment.

The practical implication is straightforward: if your goal is market access, the branch route is usually faster, cheaper and far less disruptive. If your goal is a structural change to ownership, activity or long-term domicile, the new entity route may be the right one despite the extra work. Our mainland company formation and free zone company formation pages set out what each structure involves.

Step by Step: How the Transition Actually Works

The sequence below covers the branch route under Resolution 11, which is the path most established free zone owners take. The new entity route follows a standard mainland formation process instead.

1. Map your activities. Confirm that what you intend to do on the mainland appears on the DET list of approved economic activities and is consistent with your existing free zone licence. A mismatch here is the most common cause of delay.
2. Obtain an NOC from your free zone authority. No mainland application proceeds without your free zone’s written no-objection.
3. Prepare the corporate documents. Memorandum and articles of association, the current free zone trade licence, shareholder documents, and the manager’s passport and Emirates ID.
4. Secure premises and Ejari if the route requires it. A physical mainland branch needs a tenancy contract registered through Ejari; confirm the requirement for your specific route before signing a lease.
5. Apply to DET. Submit through the DET channels or the Invest in Dubai platform, with the free zone NOC and any additional approvals required for regulated activities such as healthcare, education or financial services.
6. Pay the prescribed fees and collect the licence or permit. The branch licence runs for one year and is renewable; the temporary permit is capped at six months.
7. Set up separate accounting for mainland activity. This is a compliance requirement, not an optional tidiness measure, and it directly affects your corporate tax position.
8. Update your bank, contracts and insurance. Notify your bank of the new licence and update signatory and KYC records before you start invoicing from the mainland.

What Happens to Your Visas, Contracts and Bank Accounts During the Move

This is the part business owners worry about most, and the honest answer depends entirely on which route you take.

Employee visas. On the branch route, your existing free zone employees generally remain on their free zone visas, since the sponsoring entity has not changed. If you set up a new mainland entity, employee visas do not transfer automatically — each has to be cancelled and reissued under the new sponsor, which needs planning so that nobody falls out of status during the gap. Our page on employment visa processing covers what that involves.

Contracts. On the branch route, existing contracts stay with the same legal entity and continue unaffected. On the new entity route, they must be formally novated or reissued, and some counterparties will use that moment to renegotiate terms — build that into your planning rather than discovering it late.

Bank accounts. Under the branch route you keep the account, but you must update the bank’s records with the new licence, the board resolution and any change in signatories. Banks treat an unnotified licence change as a KYC problem, and accounts do get restricted over it. If you form a new entity, expect to open a new corporate account, with all the scrutiny that involves — our guide to why corporate accounts get rejected in Dubai is worth reading before you start.

Corporate tax. Mainland activity is treated as a domestic permanent establishment and taxed accordingly, while free zone qualifying income may retain its treatment provided the conditions are met and separate records are maintained. Take proper tax advice on this point specifically; it is the one area where getting it wrong is expensive.

Costs and Timeline to Expect

Government fees for the branch and permit routes are set in the resolution, but they are not the whole cost. Budget for the free zone NOC, any regulated-activity approvals, premises and Ejari where required, document attestation, professional fees, and — on the new entity route — the cost of a full mainland formation plus visa reissuance.

On timing, the branch route typically moves in weeks rather than months once the free zone NOC is in hand, with activity matching and regulated approvals being the usual bottlenecks. A full new-entity migration takes considerably longer, because visa cancellation and reissuance, bank account opening and contract
novation all run on their own timelines and cannot be fully parallelised.

The main variables are the number of employees to move, whether your activity requires third-party approval, whether your free zone releases the NOC promptly, and how quickly your bank processes the update.

Frequently Asked Questions About Moving From Freezone to Mainland

Can I keep my freezone company running while I also open a mainland company?

Yes. Many businesses run both, either by authorising the free zone entity to operate on the mainland through a DET branch licence, or by forming a separate mainland company alongside the free zone one. Both are legitimate structures, and the right choice depends on your activities, tax position and how you want contracts and staff to sit

Do I need a brand new trade licence to move to mainland?

Not necessarily. Under Dubai’s Resolution No. 11 of 2025, a free zone company can obtain a DET branch licence or temporary permit to operate on the mainland while keeping its free zone licence and legal identity. A brand new mainland trade licence is only required if you choose to form a separate mainland entity.

What happens to my employees’ visas during a freezone to mainland transition?

Under the branch route, employees typically remain on their existing free zone visas because the sponsoring entity has not changed. If you form a new mainland company and move staff to it, each visa must be cancelled under the old sponsor and reissued under the new one, which needs careful sequencing so no employee falls out of legal status in between.

How long does converting from freezone to mainland typically take?

A DET branch licence or permit usually takes a matter of weeks once the free zone NOC and documentation are ready. Forming a new mainland entity and migrating staff, contracts and banking takes considerably longer, since visa reissuance and account opening run on separate timelines. Regulated activities requiring third-party approval add time in either case.

Is mainland company setup more expensive than freezone?

Mainland setup has historically carried higher costs, largely driven by the requirement for physical premises and a registered tenancy contract, while free zone packages bundle facilities at a lower entry point. The gap has narrowed, and total cost depends more on activity, office requirement and visa count than on the mainland or free zone label itself. The branch route is generally the cheapest way to gain mainland access.

Map Out Your Transition With Al Taresh

Al Taresh Businessmen Services handles mainland, free zone and offshore company formation in Dubai, along with the PRO work, government liaison and visa processing that a transition of this kind depends on. We can look at your current licence, activities and staffing and tell you which of the three routes actually fits — before you commit to any of them.

Read more about mainland company formation in Dubai, or book a consultation to map out your specific transition.