Free zones in the UAE offer a multitude of benefits for businesses, including tax exemptions, full foreign ownership, and streamlined operations. However, accessing the UAE mainland market requires navigating specific regulations. Understanding these regulations is crucial for Free Zone businesses looking to tap into the broader UAE market.
This guide explores the various pathways for free zone entities to successfully tap into this lucrative market to distribute and sell their products and services.
Local Agents: Registered UAE commercial agents can serve as representatives in the Mainland, facilitating trade without direct involvement from the Free Zone entity. These agents operate within the regulations set by the UAE Ministry of Economy to ensure compliance and legality.
Distributors: Alternatively, distributors purchase your products to sell within the Mainland market. They play a pivotal role in expanding business reach, offering access to customers and market penetration that would be otherwise challenging.
Free Zone entities can access the Mainland market through a parent company possessing a valid UAE Mainland license. This typically involves establishing a subsidiary or branch in the Mainland, adhering to the legal and operational frameworks of the UAE’s commercial laws.
In certain cases, individuals or companies can obtain freelance permits or specific service licenses, enabling them to offer services across the UAE, including both free zones and the mainland, subject to regulatory approvals.
In some instances, a Dual License may be required for a company or individual to operate within the free zone and across the UAE. However, this service is offered by just a few free zones and not all activities are eligible.
A specialty food importer based in the RAKEZ Free Zone partnered with DHL Logistics, a mainland-registered logistics provider, to streamline distribution of its international food across the UAE mainland. The B2B relationship with a logistics operator acts as a bridge between the sale of products from the free zone company to the mainland while ensuring compliance with local regulations.
TechCorp, a leading electronics manufacturer in Jebel Ali Free Zone, partnered with Al Majid Trading, a renowned distributor in the UAE Mainland, to extend its innovative products to a wider reach and enhance brand presence and sales.
A free zone-based company specializing in SEO, social media marketing, and online advertising, partnered with “UAE Marketing Solutions,” a mainland firm, to access the mainland market, utilizing local expertise and networks.
This collaboration enables Digital Edge to offer its services to mainland companies through UAE Marketing Solutions’ network and local expertise, bypassing the need for a direct mainland presence and adhering to UAE’s regulatory framework.
BioHealth, a pharmaceutical company in Dubai Healthcare City, leveraged Emirates Pharma, a UAE Mainland-based distributor with an extensive network in medical supplies, to distribute its products across healthcare institutions in the UAE.
Digital Edge could also explore obtaining a dual license offered by RAKEZ in collaboration with the Dubai Economic Department.
This dual license allows them to operate both in the free zone and the mainland under a single license, simplifying operations and reducing administrative overhead.
While restrictions exist for direct mainland trade by free zone entities, strategic partnerships or appropriate licensing can unlock these opportunities.
Based on your business activities and target markets, trust us to recommend a viable solution to trade goods and services with the UAE mainland from your Free Zone company.
