In a significant move to unify its economic landscape, Dubai has launched a new permit allowing companies based in its free zones to operate on the mainland and bid for government contracts. The “Free Zone Mainland Operating Permit” was introduced by the Dubai Business Registration and Licensing Corporation, part of the Department of Economy and Tourism, in partnership with the emirate’s Free Zone Council.
Bridging Jurisdictions for Economic Growth
This strategic initiative aims to dismantle barriers between Dubai’s free zone and mainland economies, fostering greater integration and collaboration. The Department of Economy and Tourism projects that the permit will boost cross-jurisdictional business by 15 to 20 percent within its first year. The move opens up substantial opportunities for over 10,000 active free zone companies, granting them access to lucrative government tenders and contracts that were previously reserved for mainland-licensed entities. This initiative aligns with Dubai’s broader economic strategy, which saw a 4 percent year-on-year growth in the first quarter of 2025.
Permit Details and Operational Framework
The Free Zone Mainland Operating Permit is available for a fee of AED 5,000 ($1,361) for a six-month period and is renewable. It is designed for companies operating in non-regulated sectors, including technology, consultancy, design, professional services, and trading. A key advantage for businesses is the provision that allows them to deploy their existing staff for mainland operations without the requirement of hiring new employees, streamlining the expansion process and reducing initial overhead costs.
Tax and Compliance Requirements
Companies that obtain the permit will be subject to the UAE’s 9 percent corporate tax on their mainland-derived income. In line with Federal Tax Authority regulations, businesses are mandated to maintain separate and distinct financial records for their mainland operations. This ensures clear financial reporting and tax compliance, creating a transparent and regulated environment for cross-jurisdictional activities.
About The Free Zone Mainland Operating Permit
The Free Zone Mainland Operating Permit is a new initiative launched by Dubai’s Department of Economy and Tourism, through its Business Registration and Licensing Corporation, and the Dubai Free Zone Council. It is designed to allow companies registered in any of Dubai’s numerous free zones to legally conduct business activities and bid for government tenders on the mainland. The permit aims to enhance economic integration, support the growth of free zone entities, and increase their contribution to the emirate’s overall GDP.
Source: AGBI
