Advantages of Mainland Company Formation


Compared to the previous decade, business setup formalities have become easier and cost-effective in Dubai and UAE. Thanks to the visionary, pro-business UAE government. The government has sanctioned various incentives in connection with the business setup cost. The authorities have relaxed many rules and regulations in favour of investors. There are two major types of company formation strategies in the UAE. These company formation tasks are classified based on certain jurisdictions. And they are Freez

Benefits of a Mainland Company



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UAE mainland company also called Onshore company is meant for those individuals and investors who would like to set up a company in the mainland jurisdiction of UAE. By setting up a mainland company, the investor gets the official authorization to conduct both local and international business. This means that the investor can do business inside the UAE market as well as undertake international operations without any restrictions.

Getting to know more about both Mainland and Freezone companies shall help you pick the appropriate business structure. The selection must be made after considering aspects like the type of business endeavour and the target market. Here are the major benefits associated with setting up a Mainland company in UAE.

Heightened company presence



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One of the greatest benefits of setting up a mainland company in the UAE is that the company gets a nation-wide presence. The investor is authorized to set up an office anywhere in the mainland jurisdiction. This is a big advantage when compared to Freezone companies. Freezone companies have restrictions in terms of operation and are allowed to do business only in the predefined Freezone regions. When it comes to trading with mainland companies, Freezone companies need to hire the services of an intermediary distributor. The distributor service is not at all free of cost and comes with an additional service charge in terms of customs duty. So this would seriously affect the profits of a Freezone company. Therefore, a company aiming for enhanced market visibility and future expansion, mainland business set up is the most feasible option.

Get government contracts



Mainland company is the only business entity that is authorized to take up UAE government projects. These projects involve huge investment and require adequate expertise and technological know-how as far as the mainland company is concerned. In order to take up these assignments, a valid mainland license is mandatory.

Freezone companies are not authorized to take up these projects. This is a serious financial disadvantage for Freezone companies as the profits involved are huge. Therefore, if your primary intention is to take up as many government contracts and projects, the best option is to get a mainland license.

Perform business transactions with other mainland entities.



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Mainland companies are free to conduct business transactions with other Mainland companies without any restrictions. Freezone company operations are strictly limited to Freezone jurisdictions alone. If any Freezone company plans to do business with a mainland company, it is mandatory to pay an additional customs duty to a local distributor. Mainland business has a huge advantage of restriction-less operation which can be carried out both inside and outside of UAE.

Monetary gains



Freezone company formation comes with interesting no-tax and no-duty tags. Mainland company formation has certain evident monetary gains too. Minimum capital requirement is not mandatory for Mainland business setup. This is another major advantage as far as new investors or start-ups are concerned.

Do the necessary research before you pick the type of company formation. And if that job takes too much of your time and energy, leave it to us. Kiltons Business Setup Services have decades of experience in the domain of Mainland Company formation. Our consultants are always ready to help you.


Comments

Author: Umesh07 Feb 2020 Member Level: Platinum   Points : 3

It is really a very informative article for those investors and entrepreneurs who want to open a company in the UAE under the mainland or under the free zone. These two options have their own advantages but one can assess one's business potential under these two possible options and decide accordingly. It is amazing to note that to develop the business environment of their country UAE is giving such options to the outside business entities and it is imperative that our people who have such business interests should take advantage of this facility. Doing business from UAE is itself a big facility as one gets exposure to the international trade and import-export management of material and services. For those who want to expand their business on a global level, such opportunities are to be availed at an earliest.



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