How to Successfully Form a Company in Dubai: A Complete 2025 Guide

Dubai continues to be one of the most sought-after business hubs in the world, thanks to its strategic location, tax-friendly policies, and modern infrastructure. Whether you’re a startup founder or an experienced entrepreneur, forming a company in Dubai offers numerous advantages. In this complete 2025 guide, we’ll take you step-by-step through the process of company formation in Dubai, covering everything from registration to the Dubai mainland company formation cost.

1. Understand the Types of Company Structures in Dubai

Before you start, it's important to understand the different types of company structures available in Dubai. These include:

Mainland Company: A company set up in Dubai that allows you to operate anywhere in the UAE, including with local businesses.

Free Zone Company: A company set up within a designated free zone, offering benefits such as 100% foreign ownership, but limited to operating within the free zone or internationally.

Offshore Company: Used primarily for international business, providing tax efficiency but with restrictions on local operations.

Choosing the right structure depends on your business goals, operational needs, and ownership preferences.

2. Select the Right License for Your Business

In Dubai, the type of business license you need depends on the nature of your business activity. There are three primary types of licenses:

Commercial License: For businesses involved in trading goods and services.

Professional License: For businesses providing professional services such as consultancy or IT.

Industrial License: For companies manufacturing goods or conducting industrial activities.

Make sure to select the appropriate license that aligns with your business activity to avoid unnecessary complications.

3. Choose Your Business Location: Mainland or Free Zone?

One of the key decisions in the Dubai company formation process is choosing between setting up in the mainland or a free zone.

Mainland: Offers flexibility to trade anywhere in the UAE and engage in local markets. However, you’ll need a local sponsor (UAE national) for some business types.

Free Zones: Ideal for foreign investors looking for 100% ownership of their company. However, you’ll be limited to trading within the free zone or internationally.

The Dubai mainland company formation cost tends to be higher compared to free zones due to office space requirements and the need for a local sponsor. This is an important factor to consider when estimating your initial investment.

4. Understand the Dubai Mainland Company Formation Cost

The Dubai mainland company formation cost varies significantly depending on several factors, such as:

License Type: Commercial, professional, or industrial licenses each come with different fees.

Office Space: A mainland company requires a physical office, and rental costs will depend on the location and size of the office.

Local Sponsor Fees: If your business structure requires a local sponsor, this will add to the cost.

Visa Fees: If you plan to hire employees or get residence visas, this will add to the total cost.

In 2025, you can expect the total cost for setting up a mainland company to range from AED 25,000 to AED 50,000. It’s important to budget for these costs and plan accordingly.

5. Submit Your Documentation

Once you’ve selected your company structure and business license, you’ll need to submit the following documents to the Department of Economic Development (DED) for approval:

Passport copy of the business owner(s) and shareholders

UAE residence visa (if applicable)

Proof of address

Business plan (for certain types of businesses)

Once your documentation is approved, you can proceed with registration and start the formation process.

6. Open a Business Bank Account

After your company is officially registered, the next step is to open a business bank account. Dubai has numerous banks offering business accounts, and some may even offer specialized services for startups. Be prepared to present your company formation documents and business plan during this process.