Dubai has issued a resolution to allow businesses domiciled in freezones to expand operations anywhere beyond their respective zones, making it easier for them to scale operations across the emirate, according to a Dubai Media Office statement. The new resolution does not apply to DIFC-registered financial institutions and will be effective from its publication in the official gazette.

What does it mean: Establishments with a freezone license will be able to operate outside the freezone after obtaining the necessary permits from the relevant authorities — the Dubai Department of Economy and Tourism (DET) and authorities in the planned location. The DET will offer businesses a one-year renewable license for establishing a branch in Dubai outside of the freezone, or more branches alongside their headquarters in the freezone.

Companies will also be able to operate outside of Dubai, provided they secure the relevant licenses and conform to the regulatory requirements of other emirates. DET is set to issue a list of permitted activities that firms can engage in depending on their location, and they must comply with both federal and local laws.

There’s a caveat: Firms will have to have separate financial records for their operations inside and outside the freezone.

The rationale: The resolution is set to enable businesses to expand more easily into mainland Dubai, and comes within the D33 Agenda to promote a business-friendly regulatory environment in the emirate.

SOUND SMART- Several freezones in Dubai, including Dubai Design District (D3), Dubai Airport Free Zone (DAFZA), and DIFC, already have dual licensing regimes in place through agreements with the Department of Economic Development. The new rule expands these regimes across 26 freezones in the emirate, and allows for a more streamlined licensing process.

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