On March 17, 2025, Sheikh Hamdan Bin Mohammed Bin Rashid Al Maktoum unveiled Executive Council Resolution No. (11) of 2025, a groundbreaking initiative set to revolutionize Dubai’s business environment. This resolution, effective from its publication on March 20, 2025, allows free zone establishments to expand their operations onto mainland Dubai, subject to obtaining necessary licenses from the Dubai Department of Economy and Tourism (DET). This strategic move aligns with Dubai’s ambitious D33 Economic Agenda, which aims to double the city’s economy by 2033 and solidify its position among the world’s top three economic cities. The resolution creates a pathway for free zone businesses to integrate into mainland markets, unlocking unparalleled opportunities for growth, innovation, and investment.
Key Implications for Businesses
- Expanded Scope and Applicability: The resolution applies to all free zone establishments in Dubai, excluding financial institutions licensed in the Dubai International Financial Centre (DIFC). This broad application significantly enhances the business landscape across various sectors.
- Streamlined Operation: The DET can issue renewable licenses for branches or specific activities.
- In this context, under Article 4, there are three types of licenses/permits that can be issued:
- License to establish a branch within the Dubai mainland
- License for a branch with headquarters in the free zone
- Temporary permit for specific activities (for up to six months)
- Conditions for Licensing: Licensing a branch within the Emirate requires submitting a request to the DET, obtaining prior approval from the licensing authority and relevant government authorities, securing a valid license, paying prescribed fees, and complying with any additional conditions specified by the Director General of the DET.
- It is, however, important to note that: Branches established under these licenses do not enjoy legal personality and are not considered independent of the parent establishment.
Additional Important Aspects of the Resolution
- Compliance with Local Legislation: Establishments must comply with federal and local legislation relevant to their activities. This includes maintaining separate financial records for activities conducted outside the free zone and within the Emirate.
- Fees and Levies: The resolution specifies the fees for issuing licenses and permits. For instance, a license to establish a branch within the free zone costs AED 10,000 annually, while a temporary permit for specific activities costs AED 5,000.
*Workforce Considerations: A key driver of this resolution’s significance is the ability for free zone companies to utilize their existing workforce in their mainland operations, potentially preserving associated benefits. However, the precise application and compliance requirements remain undefined until the DET releases further implementing regulations. As free zone companies consider leveraging their existing workforce for mainland operations, it is vital to analyze the potential implications during this transition. Though the resolution suggests retained benefits, the DET’s upcoming regulations will define the precise application and compliance requirements.
Furthermore, the DET is set to release a comprehensive list of permitted economic activities by September 2025, providing essential guidance for strategic expansion planning.
Understanding these regulations and their transitional implications is crucial for capitalizing on Dubai’s changing business environment. We strongly recommend exploring how these changes will affect your operations.
How Al Tamimi can help?
Their team is ready to provide expert guidance, in-depth analysis, and practical assistance to help you navigate this period effectively. For tailored solutions, please contact the key contacts.
Key Contacts
Samer Qudah Partner, Head of Corporate Structuring, s.qudah@tamimi.com
Samir Kantaria, Partner, Head of Employment & Incentives, s.kantaria@tamimi.com