Since the UAE’s 2021 Commercial Companies Law amendment, the large majority of mainland business activities in Dubai can be 100% foreign-owned, with no local sponsor and no minimum capital requirement imposed by law. This reversed decades of mandatory 51% UAE-national ownership and is one of the most significant reforms in the country’s business history.
This guide explains exactly which activities qualify, what still requires local involvement, and how to set up correctly.
What Changed in 2021
Before the reform, mainland LLCs required a "local sponsor" to hold at least 51% of company shares, with the foreign investor limited to 49%. Following the amendment to the Commercial Companies Law, the Department of Economy and Tourism (DET) published a list of more than 1,000 commercial and industrial activities eligible for up to 100% foreign ownership, covering trading, technology, consulting, manufacturing, F&B, and many other sectors.
Which Activities Still Require Local Involvement?
A small number of sectors remain restricted or require special approval, including:
- Banking and insurance
- Oil and gas exploration and production
- Telecommunications
- Security, defense, and military-related activities
- Certain Hajj and Umrah, religious, and other sensitive sectors
For these activities, a local partner or specific government approval is still typically required. For everything else on the approved DET activity list, 100% foreign ownership is available without a sponsor.
Do You Need a Local Service Agent?
Some professional license categories (certain consultancy, legal, and service activities) may still require a Local Service Agent (LSA) rather than a local sponsor. The distinction matters: an LSA holds no equity and has no ownership stake — they are paid a fixed annual fee to assist with government liaison and paperwork, while you retain 100% ownership and full control of the business.
Capital Requirements: Setting the Record Straight
There is no blanket AED 2 million minimum share capital requirement for 100% foreign-owned mainland companies in Dubai. Capital requirements, where they exist, are activity-specific and set by the relevant regulator. This may include, for example, certain financial, real estate brokerage, or industrial licences. Most standard trading, consulting, and service activities have no fixed minimum capital requirement under DET rules.
Legal Structures Available
- LLC (Limited Liability Company) - the most common structure; 1–50 shareholders, liability limited to capital contribution.
- Sole establishment - single owner, suited to freelancers and solo professionals in eligible activities.
- Civil company - used for professional partnerships such as consultancy, legal, and accounting practices.
- Branch of a foreign or UAE company - an extension of an existing entity rather than a new standalone company.
Setup Steps
- Confirm your business activity is on the DET’s 100%-ownership eligible list.
- Choose your legal structure (LLC, sole establishment, civil company, or branch).
- Reserve a trade name that complies with UAE naming rules.
- Draft and notarise the Memorandum of Association (and Local Service Agent agreement, if applicable).
- Secure a tenancy contract for your business premises — mainland licences require physical office space.
- Obtain initial approval and any activity-specific approvals from relevant ministries or authorities.
- Submit final documents to DET and pay licence fees to receive your trade licence.
- Apply for investor and employee visas, then open a corporate bank account.
Mainland vs. Free Zone: Quick Comparison
| Factor | Mainland (eligible activities) | Free Zone |
| Foreign ownership | Up to 100% | Up to 100% |
| Local sponsor required | No (most activities) | No |
| Market access | Full UAE mainland + international | Free zone + international (mainland access via distributor/branch) |
| Office requirement | Physical office mandatory | Flexi-desk often sufficient |
| Government contracts | Eligible | Generally not eligible |
Confirming whether your specific activity qualifies for 100% ownership, and which structure fits best, takes only a few minutes with the right guidance. Contact MSZ Consultancy at +971 52 544 1248 for a free mainland eligibility check
Mohammed Sultan Zubair
Founder & Managing Director - MSZ Corporate Services Provider
Mohammed Sultan Zubair is a leading business consultant and entrepreneur based in Dubai, recognized for his expertise in business setup in the UAE and Saudi Arabia. As the Founder and Managing Director of MSZ Corporate Services Provider, he has helped entrepreneurs, investors, and multinational companies establish and expand their businesses across the Middle East.
With over 15 years of industry experience, Zubair specializes in company formation in UAE mainland, free zones, and offshore jurisdictions, as well as Saudi Arabia business setup, regulatory compliance, and cross-border expansion strategies.
His mission is to simplify business setup in the Middle East, enabling clients to focus on growth while MSZ handles complexity.
Frequently Asked Questions
Yes, for the large majority of commercial and industrial activities on the Department of Economy and Tourism’s approved list, following the 2021 Commercial Companies Law reform.
No. There is no blanket capital requirement for 100% foreign ownership. Some specific regulated activities carry their own capital rules, but most standard trading, service, and consultancy licences do not.
A local sponsor historically held equity (51%) in the company. A Local Service Agent holds no ownership and is paid a fixed fee purely to assist with government processes; the foreign investor retains 100% ownership and control.
Strategic sectors such as banking, insurance, oil and gas exploration, telecommunications, and security/defence-related activities typically still require local involvement or special government approval.
Yes. Mainland companies can bid for and hold government contracts, an advantage not generally available to free zone entities.