Free Zone Mainland Operating Permit in Dubai: Eligibility, Cost and Rules

Dubai’s Free Zone Mainland Operating Permit provides eligible Dubai Free Zone companies with a structured route to conduct approved business activities in mainland Dubai without immediately establishing a separate mainland company.

The framework is based on Dubai Executive Council Resolution No. 11 of 2025, which regulates how Free Zone establishments may operate outside their designated zones. A Free Zone licence alone does not automatically authorise mainland operations. The company must obtain the appropriate licence or permit from the Dubai Department of Economy and Tourism.

The Free Zone Mainland Operating Permit was launched by the Dubai Business Registration and Licensing Corporation, part of the Dubai Department of Economy and Tourism, in collaboration with the Dubai Free Zone Council.

Eligible Free Zone companies holding a Dubai Unified Licence can apply digitally through the Invest in Dubai platform. During the initial phase, the permit covers approved non-regulated activities, including technology, consultancy, design, professional services, and trading.

The permit is valid for six months and currently carries a government fee of AED 5,000. It may be renewed for another six-month period upon payment of the same fee.

The permit can provide qualifying businesses with access to mainland customers, domestic supply chains, and government contracting opportunities while allowing them to retain their existing Free Zone company structure. Businesses using the permit may also use their existing employees for the approved mainland operations.

However, the permit does not provide unrestricted mainland access. Eligibility depends on the company’s Free Zone, Dubai Unified Licence status, approved activity, regulatory requirements, and the conditions imposed by the relevant authorities.

This guide explains who may qualify, what the permit allows, the application process, costs, employment considerations, tax and accounting implications, and when a mainland branch or separate mainland company may be more appropriate.

Free Zone Mainland Operating Permit Dubai: What Does It Allow?

The permit allows an eligible Dubai Free Zone company to conduct specifically approved activities in mainland Dubai while retaining its existing Free Zone legal entity and licence.

Subject to the activity approved by the Dubai Department of Economy and Tourism, the permit may enable the company to:

• Provide approved services to mainland customers

• Enter contracts connected with the authorised mainland activity

• Participate in domestic supply chains

• Access eligible government tenders and contracting opportunities

• Conduct approved trading activities

• Use its existing Free Zone employees for the authorised mainland operations

The permit is activity-specific. It does not automatically extend every activity appearing on the company’s Free Zone licence to the mainland.

The company must conduct only the activities stated on the permit and comply with all federal and Dubai legislation governing those activities. External approval may still be required where the activity, product, premises, or customer relationship is regulated.

The permit authorises activity within the Emirate of Dubai. It does not authorise the company to operate automatically in Abu Dhabi, Sharjah, or another emirate. Separate licences or permits must be obtained from the competent authority where the business intends to operate outside Dubai.

The company also remains subject to audit and inspection in relation to its mainland activities.

Who Is Eligible for the Permit?

Eligibility is not automatic for every UAE Free Zone company.

During the initial phase, the Free Zone Mainland Operating Permit is available to eligible companies that:

• Are incorporated in a Dubai Free Zone

• Hold a valid Free Zone trade licence

• Hold a Dubai Unified Licence

• Conduct an activity included within the approved permit framework

• Obtain the approval of their Free Zone licensing authority

• Obtain any additional government or regulatory approval required for the activity

• Provide the documents and information requested through the application process

• Pay the applicable government fee

The initial framework covers approved non-regulated activities in areas including:

• Technology

• Consultancy

• Design

• Professional services

• Trading

Inclusion within one of these general categories does not guarantee approval. The precise activity must appear on the list approved by the Dubai Department of Economy and Tourism and must correspond with the company’s existing Free Zone licence.

The permit does not:

• Add an activity that is absent from the Free Zone licence

• Replace sector-specific regulatory approval

• Authorise activity outside Dubai

• Create unrestricted access to every mainland market or government contract

• Replace customs, product-registration, tax, premises, or operational requirements

• Apply to financial establishments licensed within the Dubai International Financial Centre

A company should confirm eligibility before signing mainland contracts, bidding for work, leasing premises, or representing that it is authorised to operate outside its Free Zone.

Operating Permit or Mainland Branch?

Executive Council Resolution No. 11 of 2025 provides three possible routes for a Dubai Free Zone company seeking to conduct activities outside its Free Zone:

1. A temporary permit to conduct specific activities in Dubai

2. A licence for a branch located within mainland Dubai

3. A licence for a branch that remains based in the Free Zone while conducting authorised activities in Dubai

Temporary Mainland Operating Permit

The temporary permit may be suitable where the company:

• Requires access to mainland Dubai for defined activities

• Wants to test the mainland market

• Does not initially require a separate branch

• Qualifies under the approved activity framework

• Can operate using its existing Free Zone structure and workforce

The permit is valid for up to six months. The current fee is AED 5,000 for issuance and AED 5,000 for each renewal.

Branch Operating from the Free Zone

This structure may be more appropriate where the company requires a continuing mainland presence but wishes the branch to remain based at the existing Free Zone location.

The licence is valid for one year and may be renewed annually. The government fee stated in the Resolution is AED 10,000 for issuance and AED 10,000 for renewal.

The branch does not have a separate legal personality from the Free Zone parent company.

Branch Located in Mainland Dubai

A mainland-located branch may be more appropriate where the business requires:

• Dedicated mainland premises

• A permanent operational location

• Activities that are unsuitable for a temporary permit

• A broader or more established mainland presence

• Premises, facilities, or approvals connected with the activity

This branch licence is valid for one year and may be renewed. The branch remains legally part of the Free Zone parent company rather than becoming a separate company.

The correct option depends on the activity, duration, premises, customers, regulatory requirements, and expected scale of mainland operations. A temporary permit should not be selected solely because its initial fee is lower.

How to Apply for the Free Zone Mainland Operating Permit

Eligible companies can apply digitally through the Invest in Dubai platform.

Before applying, the company should confirm:

• Its Dubai Free Zone licence is valid

• It holds an active Dubai Unified Licence

• The proposed mainland activity appears on its existing Free Zone licence

• The activity is included within the permit framework

• Its Free Zone authority approves the mainland activity

• Any external regulatory approval required for the activity has been obtained

The application process generally includes:

1. Reviewing the existing licence and proposed mainland activity.

2. Confirming eligibility with the relevant Free Zone authority.

3. Obtaining activity-specific government approvals, where required.

4. Accessing the permit service through Invest in Dubai.

5. Entering the company and activity information.

6. Uploading the requested corporate documents.

7. Paying the AED 5,000 government fee.

8. Receiving the permit for the approved activity.

Executive Council Resolution No. 11 of 2025 identifies the company’s constitutional document and valid Free Zone trade licence among the information that may be required. DET may request additional documents according to the company, activity, and application circumstances.

The company should not commence mainland operations, sign contracts as an authorised mainland operator, or advertise the approved activity until the permit has been issued.

After approval, the business should record the permit number, authorised activity, issue date, expiry date, renewal deadline, and any conditions imposed by DET, the Free Zone authority, or another regulator.

Employees, Premises and Mainland Operations

A company holding the permit may use its existing employees registered through the Free Zone portal for the authorised mainland activity.

This can allow the business to expand into mainland Dubai without immediately recruiting a separate workforce solely for the permitted operations.

However, the permit should not be interpreted as automatically providing:

• Additional employee visa allocations

• New work permits outside the company’s existing Free Zone arrangements

• Approval for employees to perform activities not covered by the permit

• Permission to establish regulated or activity-specific premises

• Authority to operate from any mainland location without further approval

Where the activity requires an office, retail unit, warehouse, clinic, workshop, industrial facility, or other approved premises, the company should confirm whether the temporary permit is sufficient or whether a mainland branch and separate premises approval are required.

The business should also define:

• Which employees will support the mainland activity

• Their responsibilities and reporting lines

• Where the work will be performed

• How attendance and working time will be recorded

• Which entity will issue invoices and receive payments

• How confidential information and company property will be managed

• Whether insurance policies cover the mainland activity

• Whether customer contracts reflect the correct licensed entity and permit

The permit does not create a separate legal entity. Contracts, invoices, liabilities, and employee arrangements remain connected to the existing Free Zone company unless a separate branch or company structure is established.

Accounting and Corporate Tax Implications

A Free Zone company using the permit must maintain separate financial records for activities conducted outside the Free Zone and within mainland Dubai.

The accounting framework should separately identify:

• Mainland revenue

• Direct costs connected with mainland activity

• Shared operating expenses and their allocation

• Customer invoices and credit notes

• Employee and contractor costs

• Assets used for mainland operations

• VAT treatment

• Related-party transactions

• Amounts payable to or from other branches or group companies

Separate records do not necessarily require a completely separate accounting system, but the company must be able to identify and support the financial results attributable to the mainland activity.

The company should not assume that all income earned under the permit will continue to qualify automatically for the Free Zone 0% Corporate Tax rate.

Dubai’s official permit announcement states that mainland activities conducted under the framework are subject to 9% Corporate Tax and require separate financial records. Federal Tax Authority guidance further explains that where a Qualifying Free Zone Person operates through a Domestic Permanent Establishment outside the Free Zone, the profits attributable to that establishment are subject to Corporate Tax at 9%.

The precise tax treatment depends on the operating model, activity, contractual arrangements, place of business, and whether the mainland operations constitute a Domestic Permanent Establishment.

Before using the permit, the company should obtain tax advice covering:

• Whether it remains a Qualifying Free Zone Person

• Whether the mainland activity creates a Domestic Permanent Establishment

• Allocation of income and expenses

• Transfer-pricing requirements

• VAT treatment of mainland supplies

• Financial-statement and audit requirements

• Corporate Tax return presentation

Corporate Tax applies to taxable income, not simply to the value of every invoice. The company should therefore maintain defensible records showing how mainland income, costs, assets, and functions have been attributed.

VAT, Invoicing and Mainland Contracts

The Free Zone Mainland Operating Permit does not create a separate legal entity. The existing Free Zone company remains the contracting party, invoice issuer, payment recipient, and party responsible for the authorised mainland activity.

Contracts and invoices connected with the mainland activity should clearly identify:

• The company’s complete registered legal name

• Free Zone trade licence details

• Registered address

• Dubai Unified Licence details, where relevant

• Mainland Operating Permit details

• Approved activity

• VAT Tax Registration Number, where applicable

• Payment terms and bank-account details

The company should ensure that the activity described in proposals, contracts, purchase orders, invoices, websites, and marketing materials corresponds with both its Free Zone licence and the Mainland Operating Permit.

The permit does not create an automatic VAT exemption. A UAE-resident business must generally register for VAT where its taxable supplies and imports exceed AED 375,000 during the previous 12 months, or are expected to exceed that amount within the next 30 days.

Voluntary VAT registration may be available where taxable supplies, imports, or qualifying taxable expenses exceed AED 187,500.

A VAT-registered company must apply the correct VAT treatment and issue compliant tax invoices for taxable supplies. The applicable treatment depends on the nature of the goods or services, the customer, the place of supply, and any zero-rating or exemption conditions.

The accounting system should use separate revenue and cost codes for mainland activity so that the company can reconcile:

• Contracts and invoices

• VAT reporting

• Customer payments

• Mainland revenue and expenses

• Corporate Tax calculations

• Permit-specific records

Before signing a mainland contract, the company should confirm that the permit will remain valid for the complete service or delivery period. Where the engagement will continue beyond the permit expiry, the contract should address renewal, regulatory approval, and the consequences if the permit cannot be renewed.

Permit Renewal and Continuing Compliance

The Mainland Operating Permit is valid for six months and may be renewed for another six-month period. The current government fee is AED 5,000 for issuance and AED 5,000 for each renewal.

The business should begin the renewal review before the permit expires.

Before renewal, confirm that:

• The Free Zone trade licence remains valid

• The Dubai Unified Licence remains active

• The permitted mainland activity remains on the Free Zone licence

• The activity remains eligible under the operating-permit framework

• Free Zone authority approval remains valid

• External regulatory approvals remain current

• Company and manager information is accurate

• Separate mainland financial records are maintained

• Corporate Tax and VAT requirements have been reviewed

• Contracts extending beyond the expiry date are properly managed

The company should also review the permit when there is a change involving:

• Trade name

• Free Zone licence or licensed activities

• Ownership or legal structure

• Manager or authorised signatory

• Registered address

• Mainland operating location

• Regulatory approval

• Nature or scale of the mainland activity

The business should confirm with the relevant authority whether the change requires an amendment, a new permit application, or a different mainland structure.

Operations should not continue after the permit expires unless the renewal or replacement authorisation has been issued.

Companies operating under the framework remain subject to applicable Dubai and federal legislation, audit, inspection, and administrative enforcement. Supporting records should therefore be retained and made available when requested.

When Is the Mainland Operating Permit the Right Option?

The permit may be appropriate where a qualifying Dubai Free Zone company:

• Wants to test demand in the mainland market

• Requires temporary or limited access to mainland customers

• Intends to conduct an approved non-regulated activity

• Wants to participate in eligible domestic supply chains or government contracts

• Can perform the activity using its existing legal entity and workforce

• Does not immediately require permanent mainland premises

• Can maintain separate financial records for the mainland activity

A mainland branch or separate mainland company may be more appropriate where the business:

• Requires a permanent mainland presence

• Needs retail, warehouse, industrial, clinical, workshop, or other regulated premises

• Intends to conduct activities not included within the permit framework

• Requires continuing operations beyond repeated six-month permit periods

• Needs a structure designed for substantial mainland revenue

• Requires additional employees, visas, facilities, or operational approvals

• Wants a clearer long-term separation between Free Zone and mainland operations

The decision should consider more than the AED 5,000 permit fee. The company should evaluate:

• Activity eligibility

• Contract duration

• Premises

• Workforce

• Regulatory approvals

• Corporate Tax and VAT

• Accounting requirements

• Customer expectations

• Banking and payment arrangements

• Long-term expansion plans

The permit is best treated as a structured market-access option, not as a substitute for every type of mainland licence. Dubai’s official guidance continues to distinguish Free Zone operation from direct mainland trading unless the relevant mainland licence, branch, or permit has been obtained. 

Common Mainland Operating Permit Mistakes

Free Zone companies should avoid:

• Assuming that a Free Zone licence automatically authorises mainland activity

• Applying without an active Dubai Unified Licence

• Selecting an activity that is not included on the existing Free Zone licence

• Assuming that every consultancy, professional, technology, or trading activity is automatically eligible

• Signing mainland contracts before the permit is issued

• Conducting activities outside those stated on the permit

• Continuing operations after the permit expires

• Treating the six-month permit as a permanent mainland licence

• Assuming that the permit authorises operations in every UAE emirate

• Using premises that require separate approval

• Overlooking product registration or sector-specific regulatory requirements

• Failing to identify which employees will perform the mainland activity

• Issuing contracts or invoices that do not identify the correct legal entity

• Mixing Free Zone and mainland revenue without separate accounting records

• Assuming that all mainland income remains eligible for the Free Zone Corporate Tax treatment

• Ignoring VAT, transfer-pricing, or Domestic Permanent Establishment considerations

• Entering contracts that continue beyond the permit expiry without planning for renewal

The company should ensure that its licence, permit, contracts, invoices, employee arrangements, accounting records, website, and marketing materials all describe one consistent operating model.

Where the business requires permanent premises, extensive mainland revenue, regulated activities, or a substantial dedicated workforce, a mainland branch or separate mainland company may provide a more appropriate long-term structure.

Frequently Asked Questions

What is the Free Zone Mainland Operating Permit?

It is a temporary permit that allows an eligible Dubai Free Zone company to conduct specifically approved activities in mainland Dubai while retaining its existing Free Zone legal entity.

Does every Free Zone company qualify?

No. The company must be incorporated in an eligible Dubai Free Zone, hold a valid Free Zone licence and Dubai Unified Licence, conduct an approved activity, and satisfy the applicable authority requirements.

How long is the permit valid?

The permit is valid for six months and may be renewed for another six-month period.

How much does the permit cost?

The current government fee is AED 5,000 for issuance and AED 5,000 for each renewal.

Can the company use its existing employees?

Yes. An eligible company may use employees registered through its Free Zone arrangements for the approved mainland activity, subject to the permit conditions and applicable employment requirements.

Can the company conduct every activity on its Free Zone licence?

No. Only the activity specifically approved under the mainland permit may be conducted.

Can the company operate anywhere in the UAE?

No. The permit authorises the approved activity within Dubai. Separate authorisation may be required for activity in another emirate.

Does the permit create a separate legal entity?

No. The existing Free Zone company remains the contracting and operating entity.

Does the company need separate accounting records?

Yes. The business must be able to identify the revenue, costs, assets, employees, and other financial information connected with its mainland operations.

Is mainland income automatically taxed at 9%?

The tax treatment depends on the company’s operating model and whether the mainland activity creates a Domestic Permanent Establishment or another taxable presence. Professional tax advice should be obtained before operations begin.

Does the permit create a VAT exemption?

No. The normal UAE VAT rules and registration thresholds continue to apply.

Can the company lease mainland premises?

The permit does not automatically approve every type of office, warehouse, retail unit, clinic, workshop, or other premises. Activity-specific and premises approvals may still be required.

Is the permit suitable for permanent mainland operations?

It may support temporary or limited mainland access. A mainland branch or separate mainland company may be more suitable for substantial, permanent, or premises-dependent operations.

Can the company apply without a Dubai Unified Licence?

The current permit framework requires an eligible company to hold an active Dubai Unified Licence.

What happens if the permit expires?

The company should stop conducting the authorised mainland activity unless the permit has been renewed or replaced by another valid mainland authorisation.

How NUR Advisors Group Can Help

The Free Zone Mainland Operating Permit can provide eligible businesses with a practical route into mainland Dubai. However, the company must confirm that its activity, licence, Dubai Unified Licence status, contracts, workforce, accounting arrangements, and tax position support the proposed operation.

NUR Advisors Group assists businesses with:

• Reviewing eligibility for the Mainland Operating Permit

• Comparing the temporary permit with mainland branch and company structures

• Reviewing the proposed mainland activity

• Coordinating the application and required company documents

• Supporting Dubai Unified Licence and corporate-record requirements

• Advising on contracts, invoicing, and operational arrangements

• Supporting Corporate Tax, VAT, accounting, and bookkeeping

• Coordinating licence amendments, renewals, and government services

Our objective is to help the business select a structure that is compliant, commercially practical, and appropriate for its expected mainland activity.

Expand Your Free Zone Business into Mainland Dubai

The permit can help qualifying Free Zone companies test or expand into the mainland market without immediately establishing a separate mainland entity.

Before applying, the company should verify its eligibility, approved activity, operating requirements, tax position, and long-term commercial plans.

Contact NUR Advisors Group for professional assistance with mainland operating permits, branch structures, company formation, tax compliance, and ongoing government services.