Difference between Offshore, Mainland and Free zone business setup in Dubai!! Are you planning to start a business in the UAE? If yes, then you should know the concepts of Offshores, Mainland and Free zones. Being the most economically developed country in the world, UAE opens up huge opportunities for entrepreneurs. Every year thousands of prospective entrepreneurs plan for business setup in UAE. And with YES as the answer to the first question, even you belong to the same category. UAE is a huge country and every corner of the country is best for business setup but that one particular city that is on the top of the list is Dubai. Keeping aside the other corners of the country, Dubai is the first choice of entrepreneurs. It is the capital city and is equipped with all the facilities. So, without any doubt, even you will prefer setting your International business in Dubai. Going further, Business setup in Dubai or other locations of UAE is not all about plans and strategies; it’s also about the location that you choose. The business establishment process and operation depend on the location where you set up the business. Every economic zone in UAE has its pros and cons to update you with the same; we have mentioned the differences between offshore, mainland and free zones. Difference in ownership Mainland-You will acquire 49% of company shares and rest will be acquired by the local sponsor. Free zone- There is no such restriction and you can enjoy 100% ownership. Offshore- No physical presence is allowed in UAE so you will have 100% ownership. Difference in Office space Mainland- At least 200 square feet of office space is mandatory in the country to start the operation. Free zone- No minimum office space requirement and you can work with or without the same. Offshore- No need for office space in the country but can have a physical establishment outside the country. Difference in business operation Mainland- You can do business anywhere in the UAE but cannot connect with free zone companies. Free Zone- You will not be allowed to transact with the companies located outside the free zone.
Offshore- You are free to operate your business outside the emirates but not inside the UAE. ďƒ˜ Difference in audit and accountancy Mainland- After every financial year, you have to prepare for the audit. You will have to submit the same and authorities will approve after verification. Free zone- Except for some form of entities, others do not require auditing. The list of entities is mentioned in the rule book that has to prepare for the audit. Offshore- Audit preparation is not mandatory but to be financially updated, they can prepare one. ďƒ˜ Difference in capital requirement Mainland- The capital requirement varies according to the legal form of the business. Even, the different business types define the capital for the international business. Free zone- The free zone emirate defines the minimum capital for the business establishment. Offshore- There is no capital requirement because offshore companies have not a physical presence in the country. At last, we just wish to say that be sure with the location that you choose to set up an international business in Dubai or any corner of the UAE because it majorly contributes to the success of your organization.
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