Dubai, UAE: A Dubai regulation that lets free zone companies trade on the mainland is redrawing one of the oldest decisions facing eCommerce founders in the emirate: whether to set up in a Free Zone or on the Mainland. Under Executive Council Resolution No. 11 of 2025, a Dubai free zone company can now obtain a Free Zone Mainland Operating Permit or a branch licence and sell directly to customers across the UAE, according to Techies Infotech, a technology company headquartered in Dubai.
The permit costs AED 5,000 and is valid for six months, renewable on the same terms, while a branch licence costs AED 10,000 per year and is also renewable, the company notes. Applications run through the Department of Economy and Tourism, and the activities a company can carry out on the mainland must appear on the published list of eligible activities. The framework applies initially to non regulated sectors such as technology, consultancy, design, professional services and trading.
Previously, the choice was fixed. A free zone company could operate inside its zone, but reaching customers on the mainland meant registering a separate mainland entity, appointing a local agent, or working through intermediaries. That is no longer the case, Techies Infotech says.
A founder can now keep a free zone base and still test the local market, bid for government tenders that were previously restricted to mainland entities, and join mainland supply chains without duplicating setup costs.
What the permit changes for eCommerce founders
For eCommerce brands, the practical effect is that a free zone setup no longer locks a business out of the local market. A brand selling mainly to customers outside the UAE can still use a free zone base for regional fulfilment and international sales, while using a permit or branch licence to sell directly to households and companies across the Emirates. The company says this matters most for founders whose customer base shifts over time, since a licence chosen only for launch may not fit once order volumes rise and local demand grows.
The permit also lowers the cost of testing the mainland. Rather than committing to a full mainland entity, a founder can use a temporary permit to trial local sales, measure demand, and learn how fulfilment, returns and payments work onshore before deciding on a branch licence. Techies Infotech notes that free zone employees can support mainland activities under their existing contracts, so a business does not need to hire a separate team to make the move.
Free Zone or Mainland: the choice that remains
The permit does not erase the difference between the two routes, the company says. Free Zones still offer streamlined registration, specialised infrastructure and full foreign ownership, which suit businesses focused on international trade, cross border eCommerce and regional distribution. Mainland registration still suits brands whose customers are mainly in the UAE, who want to work directly with local companies, or who plan to expand domestic commercial activity.
What has changed is that the decision is no longer all or nothing. A founder can start in a Free Zone, add mainland access when local demand justifies it, and keep both channels running. The company argues that founders should now choose based on where their customers will be in the first two years and where growth will come from after that, rather than on setup speed alone.
A structure chosen only for speed at launch can become a constraint at scale, it says.
What founders should check before applying
There are conditions founders should not overlook, Techies Infotech says. Companies must keep separate financial records for mainland and free zone operations, and they are subject to inspection by the Department of Economy and Tourism and their free zone authority. Mainland income is subject to the standard 9 percent UAE corporate tax rate, and mainland supplies attract 5 percent VAT, so the tax math changes once a business starts selling onshore.
Founders should confirm that their activities are eligible and model both routes before choosing, the company advises.
The wider lesson, the company argues, is that structure is a business decision, not only a paperwork decision. Founders who treat it that way are more likely to choose a route that supports hiring, partnerships and new channels as the brand grows. Dubai’s permit framework, it says, gives them room to adjust that decision as the business changes, instead of locking it in on day one.
Techies Infotech is a technology and digital transformation company headquartered in Dubai, UAE. The company provides eCommerce development, custom software solutions, AI powered automation, IT consulting, system integrations, and digital transformation services to help businesses modernise operations and pursue digital growth.
- Techies Infotech
- techiesinfotechmarketing@gmail.com
Disclaimer: All information in this article was shared by Techies Infotech. UAE Startup Story has not verified or confirmed its accuracy and accepts no responsibility for it.
