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Dubai International Financial Centre (DIFC) has earned recognition as a leading financial district in the Middle East, Africa and South Asia region. With its independent common law legal system, English-language courts and robust regulatory regime, DIFC has attracted more than 5,000 registered firms and around 40,000 professionals. This environment allows businesses of varying sizes to establish roots, including those seeking to hold assets, manage investments or oversee group operations. One recent development is the move toward DIFC active enterprises, a structure designed to enable companies to function with employees in the centre, manage funds, and even own property, all while benefiting from DIFC’s advanced infrastructure.
In this article, we explore everything you need to know about DIFC active enterprises: their relationship to prescribed companies, the activities they cover, the process for registration, and the cost structure that makes them appealing to many business owners. We also examine the DIFC’s advantages, from its tax considerations to its forward-looking legal framework. If you are thinking of relocating to Dubai or reviewing offshore banking options for your wider corporate strategy, understanding how DIFC active enterprises fit into the picture can help you plan effectively.
How the concept of active enterprises evolved in the DIFC
Historically, DIFC introduced prescribed companies (PCs) as special purpose vehicles. These PCs could hold assets, but they did not always allow for employees or wide-ranging operational tasks. Over time, the authorities identified a gap: certain entities required a holding and management function, with the ability to hire staff directly. That led to the introduction of DIFC active enterprises, a classification that supports the day-to-day operations of a group, proprietary investment management, or even controlling stakes in other businesses.
The previous prescribed companies framework now serves as a pure passive vehicle for activities such as asset holding, aviation, maritime structures or intellectual property. Entities wanting staff and office space can choose the active enterprise route instead.
Prescribed companies versus active enterprises
Prescribed companies
PCs can hold assets, often through a qualifying applicant or by using a corporate service provider. They cannot employ staff. Their typical uses include property holding, structured finance transactions or IP ownership.
Active enterprises
These suit businesses requiring on-the-ground operations in DIFC, including the ability to hire and manage employees. They can engage in holding company tasks, managing office responsibilities and proprietary investment. The DIFC ensures that an active enterprise can rent or share office space, sponsor employee visas and carry out governance functions.
In practice, choosing between the two depends on your specific needs. If you only want to hold a regional asset or maintain a purely passive structure, a prescribed company might be enough. If you plan to manage diverse operations, oversee investments worldwide and centralise strategic decisions from DIFC, an active enterprise could serve you better.
Key permitted activities under active enterprises
DIFC active enterprises are formally permitted three main categories of operation:
- Holding companies
Entities that hold the securities or other equity interests of different companies. While they influence management decisions, they do not necessarily administer daily operations of the subsidiaries. Their focus is on controlling stakes, shaping strategy and preserving ownership structures. - Managing offices
These are establishments devoted to overseeing and administering group entities. In many cases, they coordinate treasury functions, IT support and general corporate services for group companies. By using a managing office approach, corporations centralise administrative tasks in DIFC’s secure legal environment. - Proprietary investment companies
Firms that invest their own funds in businesses, commercial activities or any form of global enterprise. They can manage multiple subsidiary companies and holdings under a single umbrella, creating a cohesive investment portfolio.
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Why set up an active enterprise in DIFC
Cost advantages
An active enterprise pays a one-time 100 US dollar application fee and an annual licence fee of 1,000 dollars, not including fees related to a corporate service provider (CSP) if one is required. The licence cost is relatively modest compared to certain other onshore jurisdictions, including other DIFC licences, such as the Category 1-5 DIFC licences.
Flexible office space
DIFC supports multiple workspace options. You could lease an office, share space with an affiliate already established in the centre, or use the address services of a CSP. If you plan to sponsor employees, you will need some physical space, as visa quotas are tied to square footage (around 80 square feet per visa).
Hiring employees
Unlike prescribed companies, active enterprises can employ staff. This feature makes them ideal for managing offices or proprietary investment functions that require on-site personnel to handle day-to-day activities.
Common law framework
One hallmark of DIFC is its legal environment, based on common law principles. Proceedings in DIFC courts are conducted in English, an advantage for international businesses used to UK or US legal standards.
Speed of registration
In-principle approvals often happen within three business days, followed by company registration in roughly three to five working days. This efficiency helps entrepreneurs or group directors who prefer quick turnarounds without lengthy bureaucratic processes.
Tax considerations
DIFC active enterprises may be taxed up to a maximum of 9%, but can sometimes enjoy a zero-tax structure if they meet certain criteria. This is in line with broader corporate tax regulations in the UAE, which have introduced a 9% regime for some businesses while others remain exempt under specific conditions.
Global focus
Active enterprises can hold property in Dubai’s designated freehold areas, often at reduced Dubai Land Department transfer fees if the beneficial owner remains unchanged. They can also own assets throughout the GCC and worldwide, giving them extensive reach.
Practical uses for DIFC active enterprises
From conglomerates to family-run enterprises, there are multiple scenarios where an active enterprise structure proves valuable:
Regional headquarters
A business might choose DIFC as its base for treasury, HR, and strategic planning across the Middle East and beyond. By setting up a managing office, the group keeps core functions centralised in one location, benefiting from consistent legal protection.
Family businesses
Larger family-run groups, particularly those wanting to pass on assets across generations, may use an active enterprise to oversee different divisions. They can maintain direct involvement in daily operations while centralising finances and governance.
Proprietary investment
If you want to handle your global investment portfolio from a single jurisdiction, an active enterprise can invest in manufacturing, transport or financial activities worldwide. This “one-stop” approach simplifies the management of multiple projects, especially when combined with strong corporate governance in DIFC.
Property holdings in Dubai and abroad
DIFC active enterprises can hold real estate in many freehold areas in Dubai, including widely recognised zones such as Dubai Marina, Downtown Dubai, Business Bay and others. Through a memorandum of understanding between DIFC and the Dubai Land Department, these entities can sometimes pay substantially reduced transfer fees when moving property ownership, provided the beneficial ownership is unchanged.
"For those seeking to expand into real estate investment beyond the UAE, the active enterprise can also acquire property across the GCC or globally. This flexibility allows multinational portfolios to consolidate their holdings under a single umbrella."
Steps to set up a DIFC active enterprise
Collect documents and prepare KYC
Each shareholder, director and ultimate beneficial owner (UBO) must provide passport copies and other identification. If a parent company is funding the venture, audited financial statements are typically required.
Decide on your address
You can lease space directly in DIFC, share office premises with an existing affiliate or use a CSP to provide a registered address. Keep in mind that if you need employee visas, you must secure enough office space for your projected staff.
Initial submission
Next, you present your application to the DIFC Registrar of Companies (RoC). This includes forming a clear statement on the proposed activities (holding, managing office or proprietary investment) and how they relate to an existing DIFC entity or a qualifying shareholder.
DIFC review
The DIFC may seek clarifications or additional documents. Once they are satisfied, the application proceeds to in-principle approval, which can be granted within a few working days.
Prepare legal documents
Draft resolutions, articles of association and other constitutional documents. These must comply with the DIFC Companies Law and relevant regulations for active enterprises.
Receive final approval
After all documents are approved and fees are paid, the active enterprise is incorporated. You will receive a licence number and confirmation of your legal status in DIFC.
Apply for an establishment card (if needed)
If your active enterprise intends to employ staff, you will need an establishment card from the General Directorate of Residency and Foreigners Affairs. This is the step that enables visa applications.
Office space, sponsorship and visas
Visa quotas in DIFC are linked to the size of your office. Typically, 80 square feet of leased space gives you one visa slot. If you only use a CSP’s address, you will not be able to sponsor employees. Instead, you would rely on external staff or another group entity for day-to-day functions.
Employees sponsored by your active enterprise have their visas processed through DIFC’s Government Services Office. Each applicant must complete standard procedures, such as medical checks and ID registration. Costs include a fee for the establishment card, which is about 1,900 UAE dirhams, plus the per-visa fee starting at around 2,950 dirhams for a two-year work permit.
If you have a larger group and expect multiple employees to relocate, you may consider exploring our guidance on how to relocate to Dubai. This includes insights into accommodation, schooling and daily life, ensuring a smoother transition for your team.
Get the most relevant information about business life in Dubai
Legal system and compliance requirements
DIFC upholds a unique legal structure within the UAE, built on common law. The centre’s courts can hear local or international cases in commercial disputes, and parties often appreciate that proceedings are in English. This framework gives investors and business owners peace of mind, particularly if they are accustomed to jurisdictions such as the UK or Australia.
As with other DIFC entities, active enterprises must maintain annual accounts. They may also need to comply with UAE Economic Substance Regulations (ESR) if they carry out relevant activities. While some businesses might be exempt, it is prudent to confirm your obligations. If you are seeking offshore banking or planning to hold foreign financial assets, ESR filings could become a part of your annual schedule.
Who can set up a DIFC active enterprise
DIFC typically requires a connection to the centre. Entities that qualify include:
- Existing DIFC registered entities (other than a prescribed company, foundation or non-profit organisation)
- Government entities (for example, a federal or emirate-level body holding a minimum 25% ownership)
- Family-operated businesses that demonstrate significant local ties, asset values or staff presence
If you or your parent company do not meet these criteria directly, it might be possible to partner with a CSP to ensure you meet the substance requirements. This arrangement can help if you are expanding from a different jurisdiction and wish to anchor your investment or administrative activities in DIFC.
Transferring existing businesses to DIFC
It is feasible to bring an established, operational entity under the umbrella of a DIFC active enterprise. This generally involves transferring shares in the operational business to your new active enterprise, making the latter the parent or holding entity. The process typically requires documentation to confirm the beneficial ownership and compliance with local regulations. Often, this can be done without disrupting day-to-day operations.
"Over time, DEWS has helped DIFC-based firms offer a modern, competitive benefits package that appeals to international recruits."
DIFC employee workplace savings plan (DEWS)
Employees in DIFC can benefit from the DIFC Employee Workplace Savings plan, commonly referred to as DEWS. This plan replaces the traditional gratuity system with a defined contribution scheme. Employers pay contributions monthly, ensuring that end-of-service benefits are handled in a transparent fashion. DEWS is managed by independent investment administrators, giving employees a chance to build up savings.
Sharia’ compliance options
It is possible for a DIFC active enterprise to adopt Sharia’ principles in its governance or asset management. The legal documents can state this preference, and the enterprise’s operations can follow the relevant guidelines for Sharia’-compliant transactions. If a matter arises that requires resolution through the courts, the DIFC’s system can hear the case, though the enterprise must ensure the internal framework clearly sets out the Sharia’ standard it follows.
Considerations for corporate structuring
If your active enterprise will make or manage investments internationally, you might also look into crypto licence opportunities if you plan to explore digital assets. Similarly, you could evaluate whether offshore banking might align with your global strategy, especially if you need accounts for cross-border activities. DIFC’s own environment supports these expansions, as it has built a reputation for advanced legal structures and a globally recognised regulatory model.
Some family-operated businesses use the active enterprise classification alongside a prescribed company. The active enterprise handles day-to-day management and staff, while the prescribed company holds certain assets in a purely passive capacity. This complementary setup can be advantageous if you want to separate operational liabilities from high-value properties or intellectual property.
Costs and ongoing obligations
Once the initial fees (100 dollars application, 1,000 dollars annual licence) are paid, you will likely face additional recurring costs:
- Annual filing: An active enterprise typically needs to submit a confirmation statement (300 dollars) each year.
- Registered agent (if used): Engaging a CSP for a registered address or administrative functions entails professional fees, which vary by provider.
- Office lease: If you opt for a dedicated physical location in DIFC, budget for rent and service charges, which can differ based on building category.
- Visas: Each employee visa carries a cost, plus the one-time establishment card.
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The structure suits those seeking a regional headquarters, a managing office for multiple subsidiaries, or a family business wanting to centralise investment oversight.
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In addition to leasing their own office, firms can appoint a corporate service provider for a registered address, though they will not be able to sponsor employees without dedicated space.
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Larger family-operated businesses, existing DIFC entities (other than prescribed companies), or government-related bodies can qualify to form DIFC active enterprises.
