In a significant policy shift aimed at enhancing economic integration, Dubai has enacted Executive Council Resolution No. (11) of 2025, allowing companies established in the emirate’s free zones to operate in the mainland. This move aligns with the Dubai Economic Agenda (D33), which seeks to double the city’s economy by 2033 and position it among the top three global economic hubs.
Effective from its publication in March 2025, the resolution permits free zone companies to conduct business activities in the Dubai mainland, provided they obtain the necessary licenses or permits from the Dubai Department of Economy and Tourism (DET). This development removes previous restrictions that limited free zone entities to their designated areas.
However, the resolution excludes financial institutions licensed within the Dubai International Financial Centre (DIFC), maintaining the specialized regulatory framework for the financial sector.
Free zone companies expanding into the mainland must adhere to several compliance obligations:
🔸Licensing: Obtain appropriate licenses or permits from the DET for mainland operations.
🔸Legal Compliance: Comply with all relevant federal and local laws governing their activities.
🔸Financial Records: Maintain separate financial accounts for mainland and free zone operations to ensure transparency and facilitate auditing.
🔸Employment Regulations: Ensure that employees working in the mainland branch are sponsored under that branch’s license and comply with UAE labor laws.
For activities conducted outside the Emirate of Dubai, companies must secure the necessary licenses and approvals from the competent authorities in the respective jurisdictions.
The DET, in coordination with relevant licensing authorities, will issue a comprehensive list of economic activities that free zone entities may carry out in the mainland within six months of the resolution’s enactment. This list is expected to provide clarity and assist businesses in strategic planning.
Companies already operating outside their free zones under previous arrangements have a grace period of one year to comply fully with the new regulations. The Director General of DET has the discretion to extend this compliance deadline by an additional year on a case-by-case basis.
This resolution is a strategic move to foster greater integration between free zone and mainland economies, unlocking new avenues for job creation, innovation, and investment. By allowing free zone companies to operate in the mainland, Dubai aims to create a more dynamic and resilient economic environment, reinforcing its status as a global business hub.
Dubai’s Executive Council Resolution No. (11) of 2025 represents a transformative step in the emirate’s economic policy, offering free zone companies unprecedented operational flexibility. Businesses are encouraged to review the new regulations carefully and seek appropriate legal and professional advice to navigate the expanded opportunities and compliance requirements.
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