Guide to Obtain a Dual License for Abu Dhabi Free Zone Company

In the last four years, there have been several announcements about dual licensing from many of the free zones in the UAE.

There was a time when there were certain legal and geographical restrictions on companies that wanted to operate onshore or offshore. The majority of businesses complained that they had to drastically reduce their profit-earning capacity and alter their business model in order to meet this defined set of requirements.

This new initiative will now remove all conditions and restrictions, and within no more than 3 business days, businesses may get approval for their dual license.

The Abu Dhabi Department of Economic Development or simply called ADDED launched its dual license initiative back in 2018. If you want to know how to obtain a dual license in Abu Dhabi to operate your company onshore and offshore, you are at the right place. Follow the steps given ahead to issue a dual license for your business.

Brief Introduction of Dual License Abu Dhabi

Most people must be knowing what a dual license is. This section is for those who don’t have a clear idea of the dual license. Previously, companies operating in the free zones of the UAE were not permitted to conduct direct business activities on the mainland. Let’s take an example of a furniture manufacturer. He/she would need to hire a regional distributor to sell its goods in Abu Dhabi and in the mainland of the United Arab Emirates. The local distributor is often an LLC in Abu Dhabi.

Companies formed in free zones of Abu Dhabi, UAE such as KIZAD, will be able to open a branch onshore thanks to the Dual Licensing system. Previously, it was necessary to rent an office space, go through a laborious incorporation process, and hire local service agents for their services in order to start an onshore branch company in Abu Dhabi.

The preceding conditions are now not implemented anymore. Therefore, companies submitting applications for a dual license won’t need to hire a local service agent or rent additional office space for their branch office.

Furthermore, operational costs of a business are reduced by more than 80% due to the dual license option.

Let’s move on with the process of issuing a dual license:

How to Get a Dual License in Abu Dhabi, UAE

Here are the steps to follow to obtain a dual license in Abu Dhabi for your company:

1. Submit your required documents including NOC along with an application form for the dual license to the relevant government body
2. Once you have got your initial approval, pay the dual license charges
3. After you have cleared your application fees, the relevant authorities will go through your application. After your application is completely approved, you will get your dual license. In general, the dual license is issued within 2 or 3 business days.

The Impact of the Dual License Initiative

The Department of Economic Development in Abu Dhabi has a strong opinion that streamlining multi-branch organizations and reducing administrative and logistic workload will immensely strengthen important economic sectors. This procedure’s first stage is to increase the number of business opportunities in the area.

Moving forward, a sizable stimulus package is a component of a huge financial strategy for the UAE. It would further invigorate the Emirate’s economic growth. Existing businesses have been ordered to evaluate their goals and make any required adjustments due to the dual licensing system. The cost of doing business will be significantly reduced because businesses located in the free zones would be permitted to operate on the mainland.

Benefits of a Dual License

Having a dual license may provide certain advantages, such as 

• No need of renting office space on the mainland. You will save yourself a lot of money that you would have otherwise spent on setting up a new company.
• Establishing the onshore branch of the Free Zone company typically takes less time than creating a new company. Having a dual license for your company may prove to be an affordable option to get an onshore trade license while keeping your Free Zone entity and all the advantages that come with it.

UAE Free Zones That Issue Dual Licensing

Free Zones that offer dual Licensing are:

• Dubai Design District (D3)
• Dubai Multi Commodities Centre (DMCC)
• Twofour54
• Dubai Airport Free Zone (DAFZA)
• Dubai International Financial Centre (DIFC) 
• Abu Dhabi Airports Free Zone (ADAFZ)
• Khalifa Industrial Zone Abu Dhabi (KIZAD)
• Masdar
• Abu Dhabi Global Market (ADGM)

Restrictions on Dual Licenses

Due to the free zone’s dual license requirement, the branch will not be able to register with the Ministry of Labor. In consequence, the mainland dual license will be unable to hire staff and issue work permits and labor cards. In other words, all staff will still hold free zone resident visas and work within the Free Zone company only.