Mainland Versus Free Zone for a Recruitment Agency

Determine whether the company will earn placement fees, retainers, staffing margins, software subscriptions, consultancy fees or referral commissions.

Separate HR consultancy, recruitment mediation, executive search, temporary employment, outsourcing, labour supply, job portals and domestic-worker recruitment.

Determine whether clients are mainland companies, Free Zone entities, overseas employers, government bodies or individual consumers.

Establish the target professions, nationalities, skill levels and countries of recruitment.

Obtain activity confirmation from DET, the selected Free Zone and MOHRE where applicable. Identify any additional sector authority.

Confirm the requirements for shareholders, beneficial owners, managers and responsible employees.

Determine the applicable guarantee, insurance, capital and working-capital requirements.

Confirm office requirements before entering a long-term tenancy.

Document services, pricing, clients, candidate sourcing, overseas partners, staffing and compliance controls.

Complete name approval, constitutional documents, ownership declarations and commercial registration.

Complete the required MOHRE and other authority procedures before performing regulated recruitment.

Register the agency for the employee, work-permit and immigration processes applicable to its structure.

Provide the bank with a consistent description of the recruitment model, customer profile and expected transactions.

Prepare employer terms, candidate privacy notices, overseas-agent agreements, anti-fee policies and complaint processes.

Set up placement tracking, recruiter commissions, worker payroll, WPS, VAT and Corporate Tax records.

Do not advertise, place candidates or supply workers until all required permissions are active.

Advising on HR systems is not the same as introducing candidates for employment.

The agency must verify geographic scope and any MOHRE requirement.

The authority considers the actual employment and supervision arrangement, not only the contract title.

Recruitment and employment costs should not be transferred to workers through direct or indirect fees.

Regulated recruitment can require security separate from share capital and operating cash.

The UAE agency can face legal and reputational exposure for misconduct in the recruitment chain.

CV submission and personal-data sharing require appropriate controls.

A Dubai mainland recruitment agency is formed through the Dubai Department of Economy and Tourism and requires approval from MOHRE where the proposed activity falls within regulated recruitment or employment-agency services.

The mainland company may be able to serve employers throughout the MOHRE-regulated UAE private sector, subject to:

A commercial licence issued by DET is only one component of the structure. The agency must also hold any required MOHRE permission before it begins regulated recruitment operations.

A Free Zone company is incorporated and licensed by a specific Free Zone authority.

The legal scope of those activities must be confirmed carefully.

The presence of the word "recruitment" in an activity description does not automatically authorise every form of employment intermediation in the UAE.

The Ministry of Human Resources and Emiratisation regulates recruitment and employment-agency activities within its jurisdiction under the UAE labour-law framework.

Relevant legislation includes Federal Decree-Law No. 33 of 2021 Regulating Labour Relations and its Executive Regulations.

A Free Zone company should not assume it can provide unrestricted candidate-placement services to mainland employers.

A Free Zone company may be able to provide certain services to mainland clients, but regulated recruitment activity must remain within the permission granted by the responsible authorities.

A client's willingness to pay an invoice does not prove that the agency is properly licensed.

Dubai introduced a broader framework in 2025 allowing eligible Free Zone establishments to conduct specified activities outside their Free Zones after obtaining the appropriate DET licence or permit.

Under Dubai Executive Council Resolution No. 11 of 2025, possible routes can include:

This framework does not remove federal regulatory requirements.

Even if a general consultancy activity is eligible for a mainland operating permit, regulated recruitment, employment intermediation or temporary staffing may still require MOHRE approval.

A permit should therefore not be treated as a shortcut around recruitment-agency licensing.