Corporate services / business setup
DIFC company formation
01_introduction
DIFC is Dubai’s financial free zone, with its own statute book, its own regulator in the DFSA and its own courts. It fits regulated financial firms, funds, family offices and holding structures that want a codified common law framework. It is an expensive jurisdiction for general trading, and the licence category rather than the entity type is what sets the cost.
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01
Why founders choose DIFC over mainland or another free zone
Why founders choose DIFC over mainland or another free zone
DIFC is the region’s deepest financial cluster, so a firm that needs to sit alongside banks, funds and asset managers has a reason to pay for the address. Its statutes are codified and readable from one book, including the Companies Law (DIFC Law No. 5 of 2018), which counsel unfamiliar with common law often prefer to the directly applied English law of ADGM company formation.
None of that helps a business selling to UAE mainland customers, which is a general business setup question.
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The licence categories DIFC offers
The licence categories DIFC offers
Cost follows the category. A corporate or commercial licence is USD 12,000 a year, with company incorporation at USD 8,000 once. Retail is USD 5,100 a year, a Representative Office USD 4,000 a year, and a branch of a foreign company USD 4,000 to register. A DIFC foundation is nil to register and USD 200 a year.
The Innovation Licence subsidises the commercial licence to USD 1,500 a year, holding at that rate to year five for entities of ten staff or fewer before stepping up to USD 4,000, USD 8,000 and the full USD 12,000. Regulated activity requires DFSA authorisation on top.
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Using a DIFC company as a holding structure
Using a DIFC company as a holding structure
Yes, through the Prescribed Company: USD 400 to register and USD 1,000 a year, against USD 8,000 and USD 12,000 for a full company. It needs a DIFC registered address, in practice a co-working desk rather than premises. The catch is the director, who must be an individual employed by a DFSA-registered corporate service provider that holds a compliance arrangement with the DIFC Registrar of Companies.
Most providers will not take that liability, so finding one is the real gate on this route, not the fee. It sits under a wealth structuring or family office layer.
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How we approach this
Two questions decide DIFC, and both come before the fee is committed.
First, whether the entity is operational or passive: the Prescribed Company costs a fraction of a full licence, but it only works if a corporate service provider with a DIFC Registrar compliance arrangement will provide the director, so that is confirmed before anything is quoted. Second, whether the activity is regulated: DFSA authorisation is a separate process with its own capital requirements and timeline, and it decides the real cost of the structure. GCG settles the licence category, the director arrangement and the banking before anything is paid for.
Confirm DIFC is the right fit
Confirm the licence category and the director arrangement before committing to DIFC.
04_faq
Does a DIFC company need a physical office in the DIFC?
An operating entity does. A Prescribed Company needs a registered DIFC address, which in practice means a co-working desk from around USD 500 a month rather than full premises, and Innovation Licence holders have a flexi desk option at USD 250 a month. Dedicated space in the DIFC core starts well above AED 100,000 a year, so the office is usually the largest line in a DIFC budget, not the licence.
How long does DIFC company registration take?
The registry step runs in working days once documentation and premises are in place, and the DIFC Registrar publishes processing times per service. What sets the real timeline is DFSA authorisation for any regulated activity, which runs to months, and securing the lease. A non-regulated company with documents and desk ready is a matter of weeks.
What is the minimum capital requirement for a DIFC entity?
Under Article 35 of the Companies Law (DIFC Law No. 5 of 2018) a private company has no minimum share capital, and a public company must hold at least USD 100,000 issued and allotted, a quarter of it paid up. Regulated firms are different: the DFSA sets a base capital requirement by prudential category, and that figure governs a financial services applicant.
Can a DIFC company open a bank account outside the DIFC?
Yes. There is no requirement to bank inside the DIFC, and DIFC entities hold accounts with UAE and international banks. Approval is always the bank’s own decision, and it turns on the activity, the shareholding and the substance behind the entity rather than the jurisdiction of incorporation.
Is DIFC common law relevant to how contracts are enforced?
Yes, though it works differently from ADGM. Under DIFC Law No. 3 of 2004 the DIFC’s own statutes govern, and English common law and equity supplement them, with the DIFC Courts able to look to English and other common law jurisdictions where the statute does not reach. A contract drafted to common law expectations is enforceable in the DIFC Courts, but the starting point is always DIFC statute.