Abu Dhabi dual licence: how free zone companies trade on the mainland

A free zone licence lets a company operate inside its zone and outside the UAE. To deal directly with mainland customers, sign mainland contracts or bid for many government tenders, it needs a mainland licence. In Abu Dhabi, ADDED offers the dual licence for exactly this case: it is one of the department's seven economic licence types, described as a licence for free zone establishments in Abu Dhabi that want to operate outside the free zone.

The Abu Dhabi Registration Authority (ADRA), ADDED's registration arm, explains the benefits as keeping the free zone company's benefits while opening mainland market opportunities, and meeting Abu Dhabi Government requirements for a mainland licence when participating in tenders. Rather than forming a separate mainland company with its own shareholders and capital, the free zone company extends itself onto the mainland. One set of shareholders, one set of accounts at company level and one tax registration cover both the zone and the mainland activity.

This page covers the licensing steps. The tax treatment, which is the deciding factor for most companies, is covered in our guide to dual licence tax and summarised in the last section below.

ADRA sets two conditions:

• Free zone registration first. The company must already be registered in an Abu Dhabi economic free zone before applying.
• Free zone branch only. The mainland business must be established as a free zone branch; it is the only legal form allowed.

Because the mainland unit is a branch, it has no separate legal personality. Contracts signed by the branch bind the free zone company, and the same shareholders, managers and capital stand behind both. That keeps setup simple, but it also means a problem on the mainland side reaches the free zone company directly.

Companies registered in free zones of other emirates use a different route: since February 2025 firms registered in other emirates and their free zones can open an Abu Dhabi branch licence through TAMM, without physical premises for the first year, for activities on ADRA's published list. See branch in another emirate for how branch licensing works across emirates. In Dubai, free zone companies use a separate framework, covered in Resolution 11 of 2025.

ADRA publishes the dual licence fee as:

• Basic cost: AED 1,200, including six activities chosen by the investor;
• Additional activities: AED 100 each;
• with fees depending on the economic activities and legal form selected.

So a branch with six or fewer activities pays AED 1,200, and one with eight activities pays AED 1,200 + (2 x AED 100) = AED 1,400, before any approval, chamber or premises costs.

The process ADRA describes is:

1. Select your activities and the dual licence type on TAMM, logging in with UAE Pass.
2. Complete the forms.
3. Obtain the necessary approvals.
4. Receive the licence and start mainland operations.

ADRA states that no documents are needed beyond an Emirates ID, but lists three permits that form part of the file: a declaration and pledge, the free zone licence and a no-objection certificate. Request the NOC from your free zone authority early, as zones set their own timelines and fees for it. Processing is stated as within 24 hours if the transaction does not require external approvals.

Once licensed, the branch is a mainland business for practical purposes and has to meet mainland rules alongside the free zone company's own:

• Activities: it may only carry out the activities on the dual licence, which need not match the free zone licence exactly; keep both lists aligned with what you actually sell.
• Premises: confirm on TAMM whether your activities need a separate mainland address; ADRA's dual licence page does not state an office requirement, so ask before you sign a lease.
• Renewal: the dual licence must be renewed on its own cycle, and it depends on the free zone licence staying valid.
• Records: keep separate ledgers or cost centres for mainland and free zone activity from the first transaction, with invoices that identify which unit made the supply.
• Tenders: government buyers will ask for the mainland licence, and often for an In-Country Value certificate as well.

For many companies, the bookkeeping discipline is the real cost of the dual licence, not the AED 1,200 fee.

A free zone company that is a Qualifying Free Zone Person (QFZP) pays 0% only on qualifying income and 9% on other taxable income. Ordinary mainland sales are generally not qualifying income. A mainland branch under a dual licence is a domestic permanent establishment of the free zone company, and the FTA's guidance confirms that profits attributable to a domestic permanent establishment are taxed at 9%, with dealings between branch and head office priced at arm's length.

The branch structure does help with the de minimis test. A QFZP loses its status for the period and the following four if non-qualifying revenue exceeds the lower of 5% of total revenue or AED 5,000,000. Article 4(3) of Cabinet Decision No. 100 of 2023 takes revenue attributable to a domestic permanent establishment out of that calculation, so properly attributed branch sales are taxed at 9% without breaching the limit. Mainland sales invoiced directly from the zone with no branch stay inside the test.

The condition is clean attribution: separate records, arm's-length charges and a defensible split of costs. VAT does not change, because the branch and the free zone company are one legal person with one TRN. See our QFZP guide for the conditions.