Dubai Company Formation
Guide 2025

Dubai's strategic location at the crossroads between Europe, Asia and Africa enables companies to reach over two billion consumers within just four hours of flight time. This unique position makes Dubai a natural gateway between continents and offers unparalleled market reach for international business.

With over 240 direct flight connections to worldwide destinations and a maximum flight time of eight hours to 70% of the world's population, Dubai functions as a global hub. The GMT+4 time zone proves particularly advantageous for international business, enabling optimal overlaps with Asian markets in the morning and European markets in the afternoon.

Dubai offers first-class business infrastructure that exceeds international standards and serves as the foundation for successful business operations. In transport and logistics, the Dubai International Airport particularly stands out, functioning as the world's third-largest airport and ensuring seamless global connectivity. This is complemented by Jebel Ali Port, the largest port in the Middle East, as well as the ultra-modern metro and road system that enables efficient urban mobility.

Dubai's digital infrastructure sets global standards with comprehensive 5G network coverage and fiber-optic internet with speeds up to 1 Gbps. Smart City initiatives and IoT integration create a connected business environment, while blockchain-friendly regulation and fully digital government services significantly simplify administrative processes.

As a regional fintech center, Dubai hosts over 50 international banks and the renowned Dubai International Financial Centre (DIFC). The city has also established itself as an Islamic Finance Hub and pursues cryptocurrency-friendly policies that promote innovative financial solutions and provide companies access to diverse financing options.

The UAE government has systematically developed a series of policies that promote international business and attract foreign investment. A central building block is the possibility of 100% foreign ownership, allowing entrepreneurs to fully own their companies in Free Zones and selected Mainland sectors without needing a local partner.

Particularly attractive for international companies is the absence of foreign exchange controls, enabling free capital and profit repatriation in all major currencies. This is complemented by the innovative Golden Visa program, which grants investors and professionals a 10-year residence permit and provides long-term planning security.

Legal certainty in the UAE is based on stable jurisprudence with international standards, while tax advantages are particularly significant for Freezone activities. Qualified companies in Free Zones benefit from corporate tax exemption, which significantly improves the overall profitability of business activities.

Dubai has strategically developed specialized Free Zones for various industries, each tailored to specific business sectors. The Dubai International Financial Centre (DIFC) functions as a regional center for financial services, banking, asset management and fintech innovations. Parallel to this, the Dubai Multi Commodities Centre (DMCC) concentrates on commodities and trade, particularly gold, diamonds, energy and trading activities.

In the technology sector, Dubai Internet City establishes itself as the main hub for IT companies, software development and e-commerce platforms. Healthcare finds its focus in Dubai Healthcare City with emphasis on medicine, pharmaceuticals and wellness services. For trade and logistics, Jebel Ali Free Zone (JAFZA) offers optimal conditions for import/export, warehousing and distribution.

Particularly interesting for many entrepreneurs are the multi-sector zones like IFZA and Meydan, which offer flexible solutions for General Trading, Consulting and Professional Services. These zones enable companies to operate various business activities under one roof while adapting to changing market conditions.

Dubai is internationally recognized as a first-class business location and achieves excellent positions in various global rankings. In the Global Competitiveness Index, Dubai reaches 25th place and thus underlines its strong economic performance in international comparison. Particularly impressive is the 16th place in the Ease of Doing Business Ranking, which reflects bureaucratic efficiency and business-friendly environment.

As a leading financial center, Dubai ranks 9th in the Global Financial Centres Index and stands as number 1 in the MENA region for foreign direct investment. The city's innovative startup ecosystem is confirmed by the 4th place in the Global Startup Ecosystem Ranking, positioning Dubai as an attractive location for founders and technology companies.

The quality of life in Dubai is reflected in various international evaluations. The city is considered a top destination for expats in the MENA region and offers highest safety standards worldwide. The international education system with first-class schools and excellent infrastructure make Dubai an attractive place to live and work for international professionals and their families.

Freezone formations are ideal for companies that conduct international business and want to benefit from tax advantages and simplified procedures. Most international entrepreneurs choose Freezone due to the clear advantages and the simplicity of the formation process.

Freezone formations are particularly suitable for international service providers such as consulting companies, IT services, marketing agencies or engineering firms that serve their customers worldwide. E-commerce and online businesses also benefit significantly, as online shops, SaaS providers and digital agencies do not need to sell physically on-site and thus the geographical restrictions of a Freezone are not relevant.

Trading and import/export companies find optimal conditions in Freezones for international trading activities, wholesale and distribution with global reach. Holding companies use the structure to manage international investments and participations in other companies. Startups and tech companies particularly appreciate the flexibility for innovative business models, software development and fintech solutions.

Mainland formations are the right choice for companies that want to interact directly with the local UAE market or have business activities that require a physical presence in the UAE Mainland. This option offers more flexibility in location choice and direct market access.

Local service providers such as restaurants, retail stores or personal services that need direct customer contact in the UAE benefit from the Mainland structure. Construction and contracting companies, including construction companies, engineering offices and architects working on local projects, find the necessary prerequisites for their activities here.

Particularly relevant is Mainland for companies that want to apply for public tenders and government contracts, as these often require Mainland licenses. Healthcare and education sectors, including medical practices, clinics and schools, often require special local licenses that are easier to obtain through Mainland structures. Real estate agents and developers who want to be active in the UAE real estate market also use the advantages of Mainland formation.

With the Foundster Price Calculator you can transparently calculate the exact formation costs for your Freezone company formation. The calculator takes into account all relevant factors such as chosen Freezone, license duration, number of visas and additional services.

Mainland formations will also be possible with Foundster in the future. We are continuously expanding our service portfolio to offer you the same transparency and digital formation process for Mainland structures.

95% of international entrepreneurs choose Freezone formations due to lower costs, simpler procedures and flexibility for global business. Tax-wise, both options are equal (Small Business Relief up to 375,000 AED). Mainland only makes sense if you primarily want to serve the local UAE market.

The decision between Freezone and Mainland depends on several important factors that you should systematically evaluate. First, you should analyze your customer base: Are your main customers internationally distributed or do they concentrate on the local UAE market? Companies with international clientele benefit significantly from Freezone advantages.

Your business model plays a decisive role in the choice. Do you need a physical presence in the UAE Mainland for your business activity, or can you provide your services remotely or through digital channels? Most modern service companies get by without Mainland presence and benefit from the Freezone structure.

Tax considerations are often decisive: Both Freezone and Mainland companies benefit from Small Business Relief - this means 0% corporate tax on profits up to 375,000 AED per year. Above that, both pay 9% corporate tax (according to UAE Federal Decree-Law No. 47/2022). The main advantage of Freezone thus lies in the significantly lower formation and operating costs as well as the simpler structure for international business.

The first step takes place completely online via the Foundster platform. You configure your company according to your wishes and receive transparent real-time cost overview.

After your configuration, a Foundster expert takes over the review and guides you through the payment process. Only after payment receipt does the official processing at the Freezone begin.

In the final phase, Foundster takes over the complete processing with the Freezone. You only need to digitally sign and receive your trade license directly in the Company Cockpit platform.

Every Dubai trade license lists the registered business activities of your company. With over 2,000 available activities to choose from, selecting the right ones for your business is crucial for both legal compliance and banking success.

Most Freezones include 3 business activities in the base price, with additional activities available for an extra fee. The selection process requires careful consideration, as choosing inappropriate activities can result in penalties and operational restrictions.

Avoid overly general activities such as "General Trading" - banks frequently reject business account applications for companies with vague activity descriptions. Instead, specify your exact trading focus (e.g., "Trading in Electronic Equipment" or "Trading in Fashion Accessories").

Transparency: Real-time cost overview without hidden fees • Efficiency: Completely digital process without paperwork • Expertise: Foundster experts handle complete Freezone processing • Tracking: Complete overview of every step in the Company Cockpit platform

The Employment Visa is issued by your own company and allows you to live and work in the United Arab Emirates as an employee of your own company. This option represents the most cost-effective solution for company founders and entitles you to permanently live and work in the UAE. With this visa, you can open business accounts with local banks and apply for the Emirates ID as an official identity card.

There is an important restriction to note regarding residence requirements: With the Employment Visa, you may be outside the country for a maximum of six months at a time. If you want to be absent longer, you must apply for a Re-Entry Permit, which causes additional effort and costs. This visa option is therefore particularly suitable for entrepreneurs who actually have their center of life in the UAE and want to live and work there permanently.

The Investor/Partner Visa is specifically aimed at shareholders and investors of the company. The essential difference from the Employment Visa lies in the significantly extended residence duration: You can be outside the country for up to twelve months at a time without having to apply for a Re-Entry Permit. This regulation is unofficially tolerated and offers considerably more flexibility for entrepreneurs with international business activities.

This visa option is particularly suitable for entrepreneurs who do not want to live permanently in the United Arab Emirates, but still need a UAE Residence Visa for banking services and other business activities. The extended absence time makes it possible to run the company remotely and only travel to the UAE when needed without endangering the visa.

Every holder of a UAE Residency, whether through an Employment or Investor/Partner Visa, can sponsor their direct family members with sufficient income. The Family Visa allows spouses and children to also live and work in the United Arab Emirates without having to be employed by the company. This offers families the opportunity to live together in the UAE.

For company sponsoring, Foundster generally recommends only sponsoring direct employees who actually work for the company. An important exception is the situation when you are not married to your partner. In this case, the partner can be registered as an employee of the company to obtain an Employment Visa and later be sponsored through the regular Family Visa system.