Guide to 100% Business Ownership in UAE (2025)
Thinking about starting a business in the UAE? Here's your comprehensive guide on how expatriates can own 100% of their business—without needing a local Emirati sponsor.
Introduction
For many years, foreign investors in the UAE were required to have a local Emirati partner (owning 51% of the business) for mainland businesses. However, with the introduction of the Federal Decree Law No. (26) of 2020, this requirement was removed for most sectors. Now, expatriates can own 100% of their businesses in both Mainland and Free Zones, making UAE one of the most business-friendly environments globally.
Business Ownership Models in UAE
| Model | Ownership | Description |
|---|---|---|
| Mainland License | 100% | Full ownership in approved activities without local sponsor |
| Free Zone Company | 100% | Operate within Free Zone jurisdiction, export/import focus |
| Branch of Foreign Company | 100% | No capital requirement, linked to existing overseas company |
| Professional License | 100% | For freelancers, consultants, small service-based businesses |
Key Steps to Own a Business 100% in UAE
1. Determine Business Activity
- Choose the sector and type of business you wish to establish (commercial, industrial, service)
- Certain activities like Oil & Gas, Defense, require special approvals
2. Decide Mainland or Free Zone
- Mainland: Ideal for businesses targeting local UAE market
- Free Zone: Perfect for international trade, lower setup cost, easier visas
3. Company Registration & Trade Name Approval
- Reserve your trade name with the Department of Economic Development (DED) for Mainland
- For Free Zones, apply through the relevant Free Zone Authority (e.g., DMCC, JAFZA)
4. Legal Documentation & License Issuance
- Prepare Memorandum of Association (MOA) and other legal documents
- Obtain initial approval from respective authorities
- Submit tenancy contract (Ejari for Mainland)
5. Visa Processing
- Business owners and employees can apply for residency visas under the business license
6. Open Corporate Bank Account
- Open a UAE business bank account (subject to due diligence by banks)
Common Scenarios
Scenario 1: Already Own a Business Abroad
- You can open a Branch of a Foreign Company in UAE
- No capital requirement
- Setup costs start from ~AED 12,000 - 15,000 for Mainland
Scenario 2: New Business Setup Without Existing Company
- Register a Mainland License or Free Zone Entity
- Requires minimum capital as per business activity
- Consult with For His Sake for personalized assistance
Illegal Methods to Avoid
- Avoid "renting" a license under a local sponsor's name while operating it independently (a practice known as Tasattur)
- Such arrangements are illegal and can lead to fines, blacklisting, and deportation
Emiratisation & Hiring Emirati Nationals
While there are no mandatory Emiratisation quotas for most SMEs, larger Mainland businesses may be required to hire a certain percentage of UAE nationals under the Nafis Program.
Multiple Business Activities Under One License
- You can operate multiple related activities under a single Commercial Registration (CR)
- Ensure they fall within the same activity group as defined by DED
Taxation
- UAE imposes a 9% Corporate Tax on Profits exceeding AED 375,000 (from June 2023)
- Businesses below this threshold remain tax-exempt
- VAT at 5% applies on goods and services (as applicable)
UAE vs Saudi Arabia Business Setup Comparison
Note: The following figures are based on research and market analysis but can fluctuate based on business type, location, and market conditions.
Business Ownership Structure
| Aspect | UAE | Saudi Arabia |
|---|---|---|
| Foreign Ownership | 100% in most sectors | 100% through MISA license |
| Local Sponsor Required | No (since 2020) | No (with MISA approval) |
| Free Zones | 45+ Free Zones available | Limited Free Zone options |
| Mainland Business | 100% ownership allowed | 100% ownership with MISA |
Setup Costs Comparison
| Cost Component | UAE (Mainland) | UAE (Free Zone) | Saudi Arabia (MISA) |
|---|---|---|---|
| License Fees | AED 15,000 - 25,000 | AED 8,000 - 15,000 | SAR 12,000 - 20,000 |
| Office Rent (Annual) | AED 30,000 - 80,000 | AED 15,000 - 40,000 | SAR 25,000 - 60,000 |
| Visa Costs | AED 3,000 - 5,000 | AED 2,000 - 4,000 | SAR 2,500 - 4,500 |
| Legal Setup | AED 8,000 - 15,000 | AED 5,000 - 10,000 | SAR 10,000 - 18,000 |
| Total Setup | AED 56,000 - 125,000 | AED 30,000 - 69,000 | SAR 49,500 - 102,500 |
Taxation Comparison
| Tax Type | UAE | Saudi Arabia |
|---|---|---|
| Corporate Tax | 9% (above AED 375K) | 20% (on net profits) |
| Personal Income Tax | 0% | 0% |
| VAT | 5% | 15% |
| Withholding Tax | 0% | 5-20% (on certain payments) |
Business Environment
| Factor | UAE | Saudi Arabia |
|---|---|---|
| Market Size | 10M population | 35M+ population |
| Economic Diversification | High (tourism, trade, finance) | High (Vision 2030 focus) |
| Ease of Doing Business | Very High | High (improving rapidly) |
| International Connectivity | Excellent (Dubai/Abu Dhabi) | Good (Riyadh/Jeddah) |
| Free Zone Benefits | Extensive options | Limited but growing |
Visa and Residency
| Aspect | UAE | Saudi Arabia |
|---|---|---|
| Business Visa Duration | 2-3 years (renewable) | 1-2 years (renewable) |
| Family Sponsorship | Available | Available |
| Golden Visa/PR | Available (10 years) | Available (Premium Residency) |
| Processing Time | 2-4 weeks | 3-6 weeks |
Key Advantages
UAE Advantages:
- Extensive Free Zone network
- Lower corporate tax rate
- Established international business hub
- Faster setup process
- No personal income tax
Saudi Arabia Advantages:
- Larger domestic market
- Vision 2030 opportunities
- Lower VAT rate
- Growing economy with massive investments
- Strategic location for regional expansion
Why Consult For His Sake?
Setting up a business in the UAE can be straightforward if done right. We assist you with:
- Legal pathways compliant with Shariah principles
- Avoiding common setup pitfalls
- Navigating Free Zone vs Mainland benefits
- Document preparation & PRO services
- UAE vs Saudi Arabia comparison for your specific business
Frequently Asked Questions
Can I own 100% of a Mainland business in UAE?
Yes, UAE now allows 100% foreign ownership in most Mainland business sectors, provided they are not part of the strategic restricted list.
Is a local sponsor required in Free Zones?
No, Free Zones have always allowed 100% foreign ownership. You can operate freely within the Free Zone jurisdiction or for export-related activities.
What is the cost to open a branch of a foreign company in UAE?
Opening a branch typically costs between AED 12,000 - 15,000 in government fees, excluding office rent and other operational costs.
Can I operate multiple business activities under one license?
Yes, related activities falling under the same DED activity group can be operated under a single Commercial License (CR).
What taxes apply to businesses in UAE?
UAE imposes a 9% Corporate Tax on annual profits exceeding AED 375,000. VAT at 5% applies to most goods and services.
How does UAE business setup compare to Saudi Arabia?
UAE offers more Free Zone options, lower corporate tax (9% vs 20%), but higher VAT (5% vs 15%). Saudi Arabia has a larger domestic market and Vision 2030 opportunities.
Ready to start your business in the UAE? Our experienced consultants can help you choose between Mainland and Free Zone options, navigate the legal requirements, and ensure a smooth business setup process.
Book a UAE Business Setup Consultation →